Strait of Hormuz disruptions threaten global tanker demand and energy stability

The ongoing disruption in the Strait of Hormuz is creating significant volatility in the global energy market. While oil prices have remained somewhat stable between $83 and $100 per barrel due to bypass routes in Saudi Arabia and the UAE, as well as increased non-Gulf production, the economic costs are substantial. The Center for Research on Clean Energy (CREA) estimates that importers of oil, refined products, and LNG have faced an additional $330 billion in costs over a six-month period.

BIMCO reports that the continued blockage threatens tanker demand. If the situation does not normalize, declining crude and refined product inventories could lead to higher oil prices and slower economic growth. Currently, crude and heavy oil exports have decreased by 5.7% year-on-year, while refined product exports have dropped by 11.2%.

Market analysts are divided on the outlook. While some see potential for recovery in 2027 if the strait reopens and inventories are replenished, others warn that prolonged disruptions could deplete global inventories—potentially dropping OECD stocks to 70 days of demand by late 2027—while a growing fleet of ships could simultaneously weaken tanker demand.