economy
March 3, 2026
The Strait of Hormuz is facing a blockade. These countries will be most impacted
A closure of the Strait of Hormuz would send shock waves through global energy markets, but the pain would be felt most acutely in Asia.
TL;DR
- Iran has reportedly closed the Strait of Hormuz, a vital waterway for global oil and LNG trade.
- Approximately 31% of all seaborne crude flows and 20% of global LNG exports pass through the strait.
- South Asian countries like Pakistan and Bangladesh are highly vulnerable due to their heavy reliance on LNG imports from Qatar and the UAE.
- India faces a dual shock from rising oil prices and LNG contract costs, with over half its LNG imports and 60% of its oil imports linked to the Middle East.
- China, the world's largest crude importer, has significant exposure but possesses some buffer through stockpiles and alternative supplies.
- Japan and South Korea rely heavily on Middle Eastern oil, and while their LNG exposure is lower, they face severe price effects due to import dependence.
- Southeast Asian nations, particularly Thailand, are expected to experience cost inflation and current account pressure due to rising oil prices.
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