Oil Prices Skyrocket as Strait of Hormuz Crisis Enters Critical Phase

The Strait of Hormuz oil crisis has reached its one-month mark, and experts warn that the world still hasn't grasped the severity of the situation. Prices have surged, growth forecasts are being cut worldwide, and shortages are emerging across Asia.

Conversations with over three dozen energy traders, executives, and brokers reveal a consensus: the crisis is only beginning. Many draw parallels with the 1970s oil shock, warning that a prolonged closure of the Strait would threaten an even bigger crisis.

Fuel crunches in Asia are expected to spread west, with Europe at risk of surging prices to secure cargoes and diesel shortages in the coming weeks. The US government and Wall Street analysts consider the prospect of oil prices surging to $200 a barrel.

Patrick Pouyanne, CEO of TotalEnergies SE, warns that if the crisis lasts more than three or four months, it becomes a systemic problem for the world: 'We cannot have 20% of crude oil exported globally stranded in the Gulf and 20% of LNG capacity stranded without any consequence.'

The closure of the Strait has reduced global oil flows by 11 million barrels per day. Lower demand, particularly in Asia, is helping to force a closing of the gap, but experts warn that supply buffers are being depleted.