Yes indeed, penis can shrink because of hormones! This is true.
If male body have much estrogen penis size may decrease. I would say this is very normal and logical. If boobs can grow because of estrogen, is female can become bold with testosterone, and grow muscles -so shrink penis with FEMALE hormones -is very logical and possible. I even had one case when TeaTree essential oil shrinked penis. This oil imitates estrogen in the body.
There were no fat or lower blood flow. this was not the case. Transvestites who uses female hormones to become more like females, their penis shrink in size too.