Analysis: Closure of the Strait of Hormuz Could Trigger the Most Severe Energy Supply Crisis in Decades

Odaily Planet Daily News Wood Mackenzie pointed out in its new report that a prolonged closure of the Strait of Hormuz would pose the greatest threat to the global energy market in decades. Currently, daily crude oil and condensate production in the Gulf region has been reduced by more than 11 million barrels. Meanwhile, over 80 million tons of liquefied natural gas supply annually (accounting for approximately 20% of global supply) remain unable to reach the global market.

In its latest report, the agency outlined three different scenarios: Rapid Peace, Summer Reconciliation, and Prolonged Disruption. Each scenario presents a different timeline for ending the conflict and reopening the strait, and assesses the potential impact on oil and gas supply, prices, energy demand, and the broader global economy.

Peter Martin, the company's Director of Economics, stated: "The Strait of Hormuz is the most critical chokepoint in the global energy market. If it were to be closed for an extended period, the impact would go far beyond an energy crisis. The longer the closure lasts, the greater the impact on energy prices, industrial activity, trade flows, and global economic growth." (Jin Shi)