WASHINGTON, July 12 — The closure of the Strait of Hormuz now threatens to upend global oil markets that have already been volatile throughout 2025, according to filings reviewed by analysts tracking the crisis. In 2023, an average of 21 million barrels of oil and petroleum products transited the strait each day. That volume represents roughly 20% of global consumption, according to the International Energy Agency.
Analysts at the IEA have warned that a prolonged closure could push oil prices above $150 per barrel. That threshold has not been seen since the 2008 financial crisis.
The record shows that during the 2019 attacks on Saudi Aramco facilities, oil prices spiked 15% in a single day — a benchmark for how quickly markets can react to supply disruptions in the region. The U.S. Strategic Petroleum Reserve held about 375 million barrels as of early 2025, according to available data. That figure is down sharply from a peak of 727 million barrels in 2010.
Other major oil consumers, including China and India, maintain their own strategic reserves, though the specific volumes held by those nations are not detailed in the source material.
Alternative routes, limited capacity
The Energy Information Administration has assessed that alternative pipeline routes can only partially offset the loss of strait transit. The East-West Pipeline in Saudi Arabia has a capacity of 5 million barrels per day. The Habshan-Fujairah pipeline in the UAE can carry 1.5 million barrels per day.
Together, these routes move less than a third of the daily volume that normally passes through the strait. The closure also threatens liquefied natural gas shipments.
Qatar exports about 80% of its LNG through the Strait of Hormuz, according to industry data cited in the source material. That concentration of LNG traffic through a single chokepoint compounds the risk for global energy markets already on edge. Sources familiar with the situation note that the timeline of the closure remains uncertain.
The duration of the disruption will determine whether strategic reserve releases can stabilize markets or whether prices will climb toward the IEA’s worst-case projections. What to watch next: whether the U.S. administration coordinates a release from strategic reserves with allies in Europe and Asia, and whether the alternative pipeline infrastructure can sustain the additional flow without bottlenecks.
The record from previous disruptions suggests that even partial supply interruptions in the strait produce immediate price reactions in futures markets.
