Saudi Aramco CEO Amin Nasser states the Strait of Hormuz closure causes the world to lose 100 million barrels of oil weekly, the largest energy supply shock ever experienced. The closure stems from U.S.-Israeli hostilities with Iran beginning in late February 2026. U.S. gas prices have risen approximately 50 percent, reaching a nationwide average of $4.48 as of May 7, 2026.
Strait of Hormuz closure impact
- ▪The world is losing 100 million barrels of oil weekly due to the Strait of Hormuz closure, according to the Saudi Aramco CEO
- ▪The United States has established a counterblockade outside the Strait of Hormuz, preventing transit for countries docking at Iranian ports or paying tolls imposed by Iran to access the Persian Gulf
Global oil supply disruption
- ▪Gas prices in the United States have risen approximately 50 percent since the beginning of joint U.S.-Israeli hostilities against Iran in late February 2026
- ▪The nationwide average gas price in the United States was $4.48 as of May 7, 2026
- ▪More than 600 million barrels of energy have been removed from the global system due to the U.S.-Israeli war with Iran, according to Brett Erickson of Obsidian Risk Advisors
Maritime chokepoint vulnerability
- ▪President Trump called off the military operation to escort vessels through the Strait of Hormuz on May 8, 2026, citing 'Great Progress' in talks with Tehran
- ▪Yemen's Ansar Allah campaign of strikes against ships transiting the Red Sea resulted in an estimated 66 percent decrease in traffic through the Suez Canal in late 2023
- ▪Yemen's Ansar Allah signed a ceasefire with the United States in May 2025
- ▪President Trump announced a military operation on May 6, 2026 to escort vessels through the Strait of Hormuz
GCC alternative export routes
- ▪The UAE's Habshan Fujairah pipeline has an operational capacity of 1.5 to 1.8 million barrels per day
- ▪Saudi Arabia's East-West Petroline from Abqaiq to Yanbu on the Red Sea has a full operational capacity of 7 million barrels per day
- ▪Saudi Arabia's East-West Petroline and the UAE's Habshan Fujairah pipeline have rerouted roughly 40 percent of pre-crisis Saudi and UAE export volumes during the recent Hormuz closure, according to Hesham Alghannam of Naif Arab University for Security Sciences
- ▪Saudi Arabia's East-West Petroline and the UAE's Habshan Fujairah pipeline cannot yet cover 100 percent of regional output without further targeted investment, according to Hesham Alghannam of Naif Arab University for Security Sciences
Regional geopolitical realignment
- ▪The United Arab Emirates announced an exit from the expanded Organization of Petroleum Exporting Countries (OPEC+)
- ▪Iraq invaded Kuwait in the early 1990s, sparking the First Gulf War
- ▪The White House announced a ceasefire with Iran one month before May 10, 2026
- ▪The United Arab Emirates established ties to Israel under the 2020 Trump-backed Abraham Accords
- ▪The United States and Iran exchanged fire on May 9, 2026
- ▪Joint U.S.-Israeli hostilities against Iran began in late February 2026
- ▪The Saudi-backed government in Yemen cracked down on a power play by southern separatists supported by the UAE earlier in 2026
Perspective of Saudi Arabia
- ▪Saudi Arabia's East-West Petroline and the UAE's Habshan Fujairah pipeline have rerouted roughly 40 percent of pre-crisis Saudi and UAE export volumes during the recent Hormuz closure, according to Hesham Alghannam of Naif Arab University for Security Sciences
Perspective of United States
- ▪The United States has established a counterblockade outside the Strait of Hormuz, preventing transit for countries docking at Iranian ports or paying tolls imposed by Iran to access the Persian Gulf
- ▪President Trump called off the military operation to escort vessels through the Strait of Hormuz on May 8, 2026, citing 'Great Progress' in talks with Tehran
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