When IRGC brigadier-general Ebrahim Jabari declared the Strait of Hormuz to be closed, 150 oil and LNG tankers decided to stay put rather than risk getting fired upon. Qatar Energy and other oil and gas producers soon halted production, declaring force majeure. The effect on Asia was immediate, with LNG benchmarks jumping 39% in just one session and governments now frantically ordering staff to work-from-home to save energy.
The threat to Asia had been obvious for years. The U.S. Energy Information Administration estimated that, in 2024, over 80% of the crude and LNG that transited Hormuz went to Asian markets. China, India, Japan, and South Korea accounted for nearly 70% of all Hormuz crude flows. Saudi Arabia and the UAE can only send about 2.6 million barrels of crude oil a day through bypass pipelines, not enough to offset the 20 million barrels per day now stuck. It’s even worse for LNG: There’s no way to get it out if Hormuz is closed.
