The global oil market is facing what analysts describe as the largest supply disruption in history, with around 17 million barrels per day (b/d) of crude oil and refined products removed from the market between March 1 and March 11, according to an analysis by S&P Global Energy.
The disruption—triggered by the effective closure of the Strait of Hormuz amid the escalating West Asia conflict—surpasses any previous oil supply shock.
“On a daily basis, the 17 million b/d reduction in crude oil and refined product supply available to the market from March 1–11 represents the largest oil supply disruption in history — no other historical episode comes close,” the analysis said.
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The Strait of Hormuz, one of the world’s most critical oil chokepoints, handled about 21 million b/d of oil exports before the conflict. Since tensions escalated, however, only 3–4 million b/d has reached global markets through routes that bypass the strait, according to S&P Global Energy estimates.
Limited bypass options
Gulf exporters are attempting to reroute shipments through alternative infrastructure, though the capacity of these routes remains limited compared with the volumes that normally transit Hormuz.
Saudi Arabia can export crude through its Yanbu terminal on the Red Sea, which has capacity of around 5 million b/d via the kingdom’s East–West pipeline network.
The United Arab Emirates also ships crude from the Fujairah terminal outside the Strait of Hormuz, with export capacity of about 1.8 million b/d.
Even so, S&P Global Energy said exports from several key Gulf producers remain sharply constrained.
Shipments from southern Iraq, Kuwait, Bahrain and Qatar are expected to remain negligible until tanker traffic through the Strait of Hormuz resumes.
Production risks rising
While the initial disruption stemmed from shipping restrictions preventing tankers from navigating the Strait of Hormuz, analysts say concerns are now extending to crude production itself.
S&P Global Energy estimates that 6–7 million b/d of Gulf crude production capacity may already be shut in, though the precise figure remains uncertain.
Iraq has curtailed at least 2 million b/d of output due to storage constraints, while Kuwait has also shut in part of its production. Other producers are trimming output because of security risks or limited storage.
“Re-starting field production on this scale will be a massive technical exercise,” said Jim Burkhard, vice-president and global head of crude oil research at S&P Global Energy.
“Depending on the reservoir and how long it is shut-in, it could take weeks, months or more to fully restore output. There is a similar concern on the downstream side as large refineries in the Gulf have stopped or curtailed operations,” he said.
Price outlook
S&P Global Energy has updated its base-case outlook, projecting Dated Brent crude to average $70–$100 per barrel on a monthly basis for the remainder of 2026.
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The forecast assumes tanker flows through the Strait of Hormuz resume within weeks.
However, analysts warned that markets remain highly volatile and that a prolonged closure could trigger far sharper price spikes.
“If the Strait of Hormuz were closed for months rather than weeks, crude oil prices would likely hit new record highs,” the analysis said.
TOPICSCrude oilGlobal economyThis article was first uploaded on March thirteen, twenty twenty-six, at forty-seven minutes past six in the evening.