The largest oil supply disruption on record
Brent peaked near $118 before a US-Iran framework began unwinding the premium
Summary
After US-Israeli strikes on Iran beginning 28 February, Iran restricted nearly all traffic through the Strait of Hormuz, stranding Gulf crude and LNG. Brent rose from ~$72 to above $118 by early March; producers shut in roughly 11 mb/d by May as storage filled — the IEA's largest-ever recorded supply disruption. The US and Iran sign 14-point memorandum to end the war of 18 June sent Brent back below $80, but Iran briefly re-closed the strait on 22 June citing strikes in Lebanon. Full normalisation is months away, with 500-plus vessels queued to exit the Gulf. Asia — China, India, Japan, South Korea — absorbed most pre-conflict volumes and carries the sharpest exposure.
Why it matters
Roughly 20% of seaborne oil and LNG transit Hormuz. The closure removed ~10 mb/d at peak and reset global fuel and fertilizer prices, transmitting into freight (Dual chokepoint closure drives container freight sharply higher) and central-bank policy (ECB raises rates on the Iran-driven energy shock, first hike since 2023).