Five ways the Strait of Hormuz affects global oil supply
The potential closure of the Strait of Hormuz poses a major threat to global oil supply, given its role as one of the world’s most critical energy transit routes. The narrow channel connects the Persian Gulf to international markets and serves as a gateway for crude exports from key Middle East producers. Here are five ways the Strait of Hormuz affects global oil supply: Massive disruption to global oil flowAround 20 per cent of the world’s daily oil supply, estimated at roughly 20 million barrels, passes through the strait. A closure would immediately halt a significant portion of exports from major producers such as Saudi Arabia, Iraq, Kuwait and the United Arab Emirates, creating a sudden supply shock in global markets. Limited alternative routesSome countries have pipelines that bypass the strait, but these alternatives cannot fully replace the volume transported […]