Chart of the Month Vol. 39 | "Dire Straits: The Hormuz Crisis" | Powered by Deloitte

The Strait of Hormuz remains one of the most critical chokepoints in the global energy system, and recent developments reaffirm its systemic importance. This month’s analysis highlights how geopolitical tensions in the region directly interact with energy price dynamics, particularly in natural gas markets.

Since 2015, oil and natural gas prices have followed distinct volatility patterns. While oil prices have generally remained within broader historical ranges, natural gas has exhibited sharper and more frequent spikes, reflecting a structurally more sensitive market. The ongoing Hormuz crisis reinforces this asymmetry, as disruptions disproportionately affect gas flows and amplify short-term price reactions.

Approximately 20% of global LNG trade transits through the Strait, with 83% of these volumes directed toward Asian markets. This concentration underscores a dual vulnerability: strong regional dependence on uninterrupted flows and heightened exposure of global LNG prices to localized geopolitical events. At the same time, oil product exports through Hormuz remain substantial, further solidifying its role in global price formation.

China’s diversified oil import portfolio illustrates efforts to mitigate risk, yet its continued reliance on supply routes linked to Hormuz highlights the interconnected nature of global energy markets. In this context, even regional disruptions can cascade into global market instability, reinforcing the strategic importance of secure maritime energy corridors.

The “Chart of the Month” is a HAEE publication, powered by Deloitte.