Military Conflict in Strait of Hormuz Leads to Severe Oil Supply Disruption
The Strait of Hormuz, a critical maritime passage for global oil supply, has been closed due to military conflict involving Iran, the United States, and Israel. This closure, which began in late February 2026, has drastically reduced oil shipments from the region, causing a significant supply shock. The strait typically handles about 20 million barrels per day, representing a substantial portion of global oil trade. The ongoing conflict has led to a loss of approximately 12-13 million barrels per day, with cumulative supply losses reaching around 1 billion barrels. This disruption is the largest of its kind in modern history, surpassing previous oil supply shocks. The closure has also affected the transit of liquefied natural gas and other critical commodities, exacerbating the impact on global markets. 
