Hormuz closure reshapes global shipping and oil markets

Six months into the US-Israel war on Iran, the Strait of Hormuz closure has cut daily vessel traffic from over 100 to about five, a 95 percent drop disrupting global oil and goods flows. The strait previously carried 38 percent of global crude oil, 29 percent of LPG, and 19 percent of LNG. Gulf crude exports have fallen nearly half, from 17 million barrels daily in 2025 to roughly nine million as of August 2026. Countries like Eritrea, Madagascar, and Pakistan source over three-quarters of their oil from the region, facing higher prices. Shipping has shifted toward Singapore and Malaysia, with oil prices about 20 percent above pre-war levels.