Study outlines impact of a closure of the Strait of Hormuz

A prolonged closure of the Strait of Hormuz would have significant repercussions for global supply chains and energy markets. That is the conclusion of a new study cited by chemie.de, a leading industry portal for the chemical sector. The research was conducted by the Supply Chain Intelligence Institute Austria (ASCII), the Complexity Science Hub (CSH) and TU Delft.

For the first time, the study systematically examines how dependent countries and industries worldwide are on exports from the five Gulf states whose maritime trade passes entirely through the Strait of Hormuz – Iran, the United Arab Emirates, Qatar, Kuwait and Bahrain. The findings show that Asian economies would be far more severely affected by a disruption than European ones.

Together, the countries export goods worth around $1.2 trillion per year, with energy products such as crude oil, liquefied natural gas and refined petroleum accounting for the largest share of affected trade flows at roughly $800 billion.

Using a bespoke shipping model developed for the study, the researchers analysed a range of global scenarios. Short disruptions of up to two weeks would have only limited economic consequences. If a disruption were to last longer than four weeks, however, delays could escalate sharply along global supply chains. In the short term, the researchers expect price increases but not immediate supply failures or shortages. Prolonged blockages, by contrast, could lead to persistently high energy prices, rising production costs and declining competitiveness in energy-intensive industries.

Asian economies are by far the most dependent on exports from the Gulf states. China imports goods worth around $97 billion annually, followed by India with $74 billion, Japan with $63 billion, South Korea with $30 billion and Thailand with $22 billion. The most affected sectors are crude oil, liquefied natural gas and refined petroleum products.

For Europe, the analysis presents a more differentiated picture. The EU imports around $47 billion annually from the five Gulf states reliant on the Strait of Hormuz. According to the study, the risks are concentrated in a small number of countries. Italy is the largest importer within the EU at $9.8 billion per year and sources large volumes of liquefied natural gas from Qatar, worth around $4.4 billion. Belgium is also heavily exposed: the country imports around $5.8 billion of Qatari liquefied natural gas annually, mainly via the LNG terminal in Zeebrugge, while significant diamond trade flows from the United Arab Emirates pass through Antwerp. The United Kingdom shows the highest exposure in Europe at $12.9 billion per year, including around $5.9 billion in gas products from Qatar. Germany and France, by contrast, are more broadly diversified and therefore less affected.