A simultaneous closure of the Strait of Hormuz and the Bab el-Mandeb would trigger the most severe energy crisis in modern history, likely driving crude oil prices well past $150 to $200+ per barrel within days.
The Strait of Hormuz handles roughly 20% of global petroleum liquids consumption (~20 million barrels per day).
Closing both routes instantly traps nearly one-quarter of the world’s daily oil supply, and spot prices for Brent and WTI crude would experience an immediate, unprecedented spike—a baseline jump to $150/bbl, with immediate risk of soaring past $200/bbl if the closures last more than a few weeks.
Diesel, gasoline, and jet fuel prices would skyrocket .
Normally, Saudi Arabia can bypass the Strait of Hormuz by pumping oil via its East-West Crude Pipeline to the Red Sea port of Yanbu, but tankers leaving Yanbu could not head south toward Asia, and heading north through the Suez Canal would only supply Europe, stranding the rest.
Almost all oil tankers would be forced to reroute around Africa, adding 10 to 14 days travel time, depleting global shipping capacity, and skyrocketing freight insurance rates.
A prolonged shutdown would trigger a massive wave of global stagflation, forcing central banks to hold interest rates high.
The U.S. and International Energy Agency (IEA) nations would be forced into an emergency, coordinated release of their Strategic Petroleum Reserves (SPR) to stabilize local refineries. Many nations in Europe and Asia would have to implement emergency fuel-rationing .
Even if closure was not complete, insurers would refuse to cover ships in these waters due to active combat, with the same effect as an actual military blockade.
Economic Armageddon!
Now, you understand why Iran is going slow.
