By Mari Hansen The Strait of Hormuz is practically closed twelve days into the Iran War. Simply put, about 25% of the world’s oil and LNG isn’t moving, and you can feel the weird, unequal effects of that absence. The administration in Manila discreetly implemented a four-day workweek last week; outside of typhoon season, the Philippines hardly ever does this.
A parliamentary disclosure in Seoul estimated that the working LNG inventory was about nine days. Nine. You have to read that number twice.
| Field | Detail |
|---|---|
| Conflict | US–Israel war with Iran, now in its second month |
| Key chokepoint | Strait of Hormuz — effectively closed |
| Share of global oil & LNG offline | Roughly 20 percent |
| Brent crude | Above $100 per barrel |
| Most exposed economies | Japan, South Korea, Singapore, Thailand, Philippines |
| Best-cushioned major importer | China (1.2 billion barrels in onshore stockpiles) |
| Quiet beneficiary | Russia, lifted by redirected Asian demand |
| Asia equity reaction | KOSPI –6%, Nikkei 225 –5%+ |
| LNG buffer (South Korea) | Around nine days of working inventory |
| Policy response example | South Korea’s 100 trillion won stabilization fund |
| Long-term effect | Permanent reframing of energy security across the Indo-Pacific |
Perhaps the most intriguing aspect of this entire tale is how the suffering isn’t distributed equally. Nearly 69 percent of the petroleum that typically passes through Hormuz is extracted by four economies: China, India, Japan, and South Korea. Their shock absorbers, however, differ greatly. Approximately 80% of China’s new electricity demand last year came from renewable sources, the country has over 1.2 billion barrels of oil and gas onshore, and only 4% of its grid is fed by these resources. That narrative isn’t just about stockpiles. Developed covertly over a decade, that strategic stance now appears less like climate policy and more like a long-term wager on independence from precisely this kind of situation.
Then there is the part that is impossible to ignore but more difficult to verify. Iran stated in March that only ships connected to the US, Israel, and other Western nations are subject to the closure. Since then, “CHINA OWNER” has been pinging on the trackers of at least two bulk carriers.
You can understand why CSIS advised caution this week: the evidence is suggestive rather than definitive. However, a two-tier maritime system is actually evolving at the planet’s most significant energy chokepoint if a pattern solidifies here. There has never been anything like that in contemporary energy. Quietly, it would be historic.
On the opposite side of the asymmetry are South Korea and Japan. Over 90% of Japan’s oil comes from the Middle East, with roughly 70% of it passing through Hormuz. Tokyo has more than 250 days of strategic cover, so crude is manageable for some time. It becomes dark in LNG. No strategic LNG reserves exist anywhere that are similar to the oil reserves. At most, operational buffers last a few weeks. For the first time in almost thirty years, gasoline price caps and a stabilization fund worth 100 trillion won have been implemented by Lee Jae-myung’s administration. Japan’s refiners are publicly requesting emergency releases. Although spot cargoes from the US, Canada, and Australia are being actively pursued, phone conversations cannot take the role of Qatar. No one at the press conferences wants to publicly state that painful truth.
As you see this happen, you get the impression that the true victor isn’t even present. Russian seaborne crude has never passed through Hormuz. It travels via the Pacific, Black Sea, and Baltic. India and China have every incentive to put greater pressure on Moscow in light of the stranded Gulf barrels, and Deputy Prime Minister Alexander Novak has essentially urged, “Come and get it.” The current price of Russian crude is far higher than the $59 budget guideline that Moscow set for 2026. In January, state oil and gas revenue fell to a four-year low.
Overnight, the war changed that. It’s difficult to ignore the fact that Washington spent months imposing tariffs on India and penalizing Rosneft and Lukoil in an effort to stifle Russian war funds. Ten days into the conflict with Iran, Treasury gave a 30-day reprieve, allowing Indian refiners to proceed with purchases. Twenty million barrels of stranded Russian crude have already been secured by Indian state companies. Moscow quickly became necessary in a manner that Washington’s strategy was intended to avoid.
Chris Wright, the Energy Secretary, is one of the optimists who insist that it will be weeks rather than months. Perhaps. However, Mojtaba Khamenei is being positioned as Iran’s future supreme leader, which doesn’t seem like a man about to give up. Physical damage to Ras Tanura and a number of Gulf storage terminals has not been repaired on a diplomatic schedule. Underwriters return after weeks of smooth transits rather than upon a ceasefire announcement, and P&I insurers have completely removed war-risk coverage. Everyone in the shipping industry is aware that this is a high standard.
A more subdued reworking is probably going to outlive the headlines. Instead of a climate presentation deck, energy security in the Indo-Pacific is being reframed as a concrete national security file. Europe’s desire for rooftop solar has skyrocketed; Pakistan is reporting increases in EV sales; and Xi Jinping has urged the acceleration of nuclear and hydropower. In any case, some of this was inevitable. The conflict simply made the stakes more clear and shortened the timescale. Six months ago, almost any energy minister would have publicly stated that every kilowatt-hour produced domestically now represents a unit of strategic autonomy.