Global Oil Crisis Could Last Until 2027 if Strait of Hormuz Remains Closed

A disruption in global oil supply could result in a loss of 100 million barrels per week.

The global oil market is unlikely to return to normal until next year unless shipping traffic in the Strait of Hormuz resumes within a month. This was stated by Saudi Arabia's energy giant Saudi Aramco.

"The longer the supply disruption continues, even just a few more weeks, the longer it will take for the oil market to recover and stabilize," said Saudi Aramco CEO Amin Nasser in a video conference discussing Saudi Aramco's first-quarter results.

He added that the crisis could last until 2027 if the blockage in the Strait of Hormuz continues until mid-June.

The market, which has already lost one billion barrels of oil due to disrupted production or transportation, will continue to lose around 100 million barrels of oil each week while the strait remains closed, he said.

Nasser also reminded that before the conflict began on February 28, around 20 million barrels of oil entered the market through this maritime route every day.

The conflict against oil-producing countries in the Persian Gulf, as well as Iran's effective closure of the strait – which accounts for a fifth of global oil and gas shipments – has negatively affected production and oil exports from the sector.