Hormuz Recovery Will Take Months, Possibly Years, Despite Diplomatic Efforts

The Strait of Hormuz is a critical chokepoint for oil and gas supplies, carrying around a fifth of global energy exports. Recent tensions have brought shipping to a near-halt, with Iran tightening control over the strait in response to a US blockade on Iranian tankers.

Around 13 million barrels per day of oil supply and roughly 300 million cubic meters per day of liquefied natural gas (LNG) have been trapped inside the Gulf since the conflict began. This has forced producers to shut in oil fields, refineries, and LNG plants, battering economies from Asia to Europe.

The recovery process will be complex and take time, dependent on diplomacy between Washington and Tehran, as well as logistics, tanker insurance availability, freight rates, and shipowner willingness to risk the passage. The first tankers to leave the Middle East will be those already floating inside the Gulf, laden with oil and LNG.

Around half of Gulf oil and gas fields retain sufficient reservoir pressure to return to pre-war output within two weeks, while another 30% could take up to six weeks under a stable security environment. However, damage to major energy assets and diplomatic relationships may take years to repair.