Oil industry experts have informed OPEC+ that the disruption to oil supplies caused by the closure of the Strait of Hormuz is expected to last until the end of the year, even if the waterway reopens immediately. Attendees of a private technical meeting at OPEC's Vienna headquarters on Monday, June 1, 2026, indicated it would take many months for operations to return to pre-war levels. The crisis, now in its one-month mark, has already led to price surges, cuts in global growth forecasts, and shortages across Asia.
The global oil market is facing a substantial shortfall. After accounting for interventions like emergency stockpile releases and waivers on sanctions for Russian and Iranian oil, the closure of the Strait of Hormuz is estimated to reduce global oil flows by about 11 million barrels per day. Compared to pre-war demand, this leaves a gap of roughly 9 million barrels per day, a deficit larger than the combined oil consumption of the UK, France, Germany, Spain, and Italy. While current oil futures are around $116 a barrel, up 60% since the war began, analysts are considering the prospect of oil prices surging to an unprecedented $200 a barrel if the strait remains closed for an extended period.
The impact on liquefied natural gas (LNG) is even more severe, as the Strait of Hormuz typically accounts for about a fifth of global supply. Unlike oil, there are no alternative routes or significant strategic stockpiles for LNG, with some analysts warning that the world may have to significantly reduce oil and gas consumption. Patrick Pouyanne, CEO of TotalEnergies SE, warned that a crisis lasting more than three or four months would become a "systemic problem for the world," given that 20% of global crude and LNG capacity is stranded. The longer the strait remains closed, the higher the risk of damage to key energy production assets, with parts of the world's largest LNG plant already sustaining missile damage that could take up to five years to repair.
While Saudi Arabia and the United Arab Emirates have rerouted some oil via alternative pipelines, and the US has announced record releases from its strategic reserves, these measures are finite. The US Energy Secretary Chris Wright suggested a coordinated release from the International Energy Agency could reach 3 million barrels a day, but other analysts estimate a more conservative 2 million. Higher prices might lead to marginal increases in output from some areas like the US, but these won't be enough to offset the losses from Hormuz. Japan has already requested the IEA to consider an additional coordinated release if necessary, as the market looks to Saudi Arabia, the de facto leader of OPEC+, for its remaining untapped production capacity. European natural gas prices are up over 70% since the conflict began but have not yet reached their 2022 peaks, while refined fuels like diesel and jet fuel have topped $200 in recent weeks, causing demand destruction in Asian markets.
Analysts emphasize that even if the strait reopens, it will take months for flows to normalize, and the world has yet to fully grasp the severity of the situation. Aldo Spanjer of BNP Paribas stated that oil and gas markets won't balance as long as Hormuz remains closed, and "significant demand destruction" would require prices "significantly higher than today." Jeff Currie of Carlyle Group Inc. suggests a potential loss of 5-10 million barrels a day of demand, leading to a "painful" and rapid "energy transition" being forced upon the world.
