Hormuz Closure Devastates Global Trade, Energy Sector Hit Hardest

The closure of the Strait of Hormuz has had a significant impact on global trade, particularly in the energy sector. According to industry data from the International Trade Centre (ITC), exports from Gulf economies dropped by more than half in April compared to the same period last year.

Liquefied natural gas (LNG) was hit the hardest, with a 95 percent drop in supplies. This is partly due to Iranian strikes on Qatar's Ras Laffan LNG facility in March, which forced state-backed QatarEnergy to declare force majeure and may take up to five years to repair.

Japan was the most affected market, with imports from the Gulf falling by 64 percent between April 2025 and April 2026. Other countries such as Singapore, South Korea, and Malaysia also saw significant declines in imports, ranging from 29 to 41 percent.

The report warns that disruption effects will continue as inventories and strategic reserves become depleted, delayed shipments accumulate, and higher transport and insurance costs pass through supply chains.