"If the strait stays closed, the world will have to significantly reduce its oil and gas consumption — but not before prices spike to a level that forces consumers and businesses to fly, drive and spend much less. Already, demand has begun to drop, and some countries in Asia are hoarding and rationing fuel. US government officials and Wall Street analysts are starting to consider the prospect that oil prices might surge to an unprecedented $200 a barrel.

“It’s clear to me if this crisis lasts more than three or four months it becomes a systemic problem for the world,” Patrick Pouyanne, chief executive officer of TotalEnergies SE said at the CERAWeek conference in Houston. “We cannot have 20% of the crude oil, which is exported globally, stranded in the Gulf and 20% of the LNG capacity stranded, without any consequence.”

A simple back-of-the-envelope calculation suggests the closure of the strait is reducing global oil flows by some 11 million barrels a day, after accounting for the interventions so far aimed at offsetting the loss. When compared with pre-war demand levels, that leaves a roughly 9 million-barrel shortfall — a yawning gap that is more than the oil consumption of the UK, France, Germany, Spain and Italy combined. Lower demand, particularly in Asia, is already helping to force a closing of that gap. (The market also entered the war in a surplus.)

But for supply this may be as good as it gets. A massive emergency stockpile release and US waivers on Russian and Iranian oil sanctions have bought some time, but they are finite interventions. Once they’re exhausted, it’s not clear what further tools President Donald Trump has to keep global oil prices from surging in the near term – other than fully reopening the strait. Iran has been allowing a trickle of foreign ships to pass through the waterway, but the numbers so far do little to move the needle."

https://www.bloomberg.com/graphics/2026-iran-war-hormuz-closure-oil-shock/

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