The US-Israeli conflict with Iran and the Strait of Hormuz closure have caused the largest daily oil supply disruption recorded, with lasting economic and energy market implications.
LONDON — The ongoing US-Israeli conflict with Iran, coupled with the closure of the Strait of Hormuz, has resulted in the largest daily oil supply disruption on record, significantly affecting global energy markets. According to calculations by Reuters based on International Energy Agency (IEA) and US Department of Energy data, the peak loss exceeds 12 million barrels per day, representing about 11.5% of global oil demand for 2026, an unprecedented scale compared to past crises.
This crisis differs from previous ones, such as the 1973 Arab oil embargo or the 1978-79 Iranian Revolution, not only in magnitude but also in scope. It has simultaneously disrupted crude oil, natural gas, refined fuel, and fertilizer supplies, exposing vulnerabilities in global energy supply chains shaped by decades of rising demand and intertwined trade links. Notably, around a fifth of the world’s liquefied natural gas production from Qatar has been halted. Additionally, refinery shutdowns in the Gulf have caused shortages of jet fuel and diesel internationally.
While the daily loss surpasses those seen in historic shocks, cumulative supply losses from past events like the Iranian Revolution remain higher due to their longer durations. Reuters estimates the current conflict has removed around 624 million barrels from markets during its first 52 days, with disruptions expected to continue for months or years, especially in gas supplies.
Unlike past crises where oil-exporting countries with spare capacity could partially compensate, Saudi Arabia and the UAE are also impacted now due to halted shipments through the Strait of Hormuz. This scenario marks a critical energy security challenge.
The IEA notes this combined crisis with lingering effects from the European gas supply issues post-Russia’s 2022 invasion of Ukraine represents the worst global energy crisis to date. As countries navigate shortages and volatility, historic events provide context for understanding the severe current impacts and the complex global energy ecosystem’s increasing fragility.
Sources referenced:
- https://www.gmanetwork.com/news/topstories/world/984909/explainer-how-the-iran-war-oil-and-gas-supply-shock-compares-with-past-disruptions/story/