The closure of the Strait of Hormuz by Iran has sent shock waves through global energy markets, with Asia expected to bear the brunt of the disruption, according to analysts cited in the article [1]. A senior commander from Iran's Revolutionary Guard announced that the strait had been shut and warned that any vessel attempting to transit would be targeted, as reported by Iranian media [1]. The Strait of Hormuz, located between Oman and Iran, is a critical passage for the global oil trade, with approximately 13 million barrels per day passing through it in 2025, accounting for about 31% of all seaborne crude flows, according to energy consulting firm Kpler [1].
The immediate market reaction has been a surge in oil prices, with global benchmark Brent rising 2.6% to around $80 per barrel, nearly 10% higher since the conflict began. Some analysts predict that oil prices could cross $100 per barrel if the closure persists [1]. Additionally, about 20% of global liquefied natural gas (LNG) exports from the Persian Gulf are at risk, mainly those originating from Qatar and shipped via the Strait of Hormuz [1]. Qatar, a leading LNG provider, halted production on Monday after Iranian drones struck its facilities at Ras Laffan Industrial City and Mesaieed Industrial City [1].
Asian countries are particularly vulnerable to higher oil prices due to their heavy import dependence. Nomura noted that Thailand, India, Korea, and the Philippines are the most exposed, while Malaysia could benefit as an energy exporter [1]. South Asia faces the most acute disruption, especially regarding LNG supplies. Qatar and the United Arab Emirates supply 99% of Pakistan's LNG imports, 72% of Bangladesh's, and 53% of India's, according to Kpler data [1]. Pakistan and Bangladesh, with limited storage and procurement flexibility, are especially at risk, with Bangladesh already running a structural gas deficit of more than 1,300 million cubic feet per day [1].
Go Katayama, principal insight analyst at Kpler, stated that disruption would likely trigger rapid power-sector demand destruction in Pakistan and Bangladesh rather than aggressive spot bidding [1]. India faces the largest combined exposure in the region, with more than half of its LNG imports Gulf-linked and a significant share Brent-indexed. This means a Hormuz-driven crude spike would simultaneously increase oil import costs and LNG contract prices, creating both physical and financial shocks for India [1].
CONCLUSION
The closure of the Strait of Hormuz by Iran has caused significant disruption in global energy markets, with oil and LNG prices rising and Asian countries facing heightened vulnerability. The situation poses both immediate and longer-term risks, particularly for South Asian nations with limited energy storage and procurement flexibility. If the closure persists, further price surges and supply shortages are likely, intensifying the financial and physical strain on energy-dependent economies.