Hormuz Closure Slashes Gulf Oil Output as U.S. Exporters Reap Windfall From Soaring Prices
Updated
Updated · The New York Times · May 16
Hormuz Closure Slashes Gulf Oil Output as U.S. Exporters Reap Windfall From Soaring Prices
11 articles · Updated · The New York Times · May 16
Months of shipping and pricing data show the Strait of Hormuz shutdown has forced the UAE, Iraq and other Gulf producers to cut seaborne oil output and exports sharply.
That disruption, triggered by the U.S.-Israeli war with Iran, has driven what the report calls the world’s worst-ever energy crisis and lifted prices enough to boost sales for producers outside the Gulf, especially in the United States.
Pipeline access has become the key divider inside the region: countries able to reroute crude to ports outside the strait have held up better than exporters with no alternative route.
The uneven hit helps explain which producers can better absorb the war’s economic damage and suggests today’s winners could stay dominant if Hormuz remains unreliable.
Is the U.S. sacrificing its Middle Eastern allies' economies to win the global energy war?
Can Iran's makeshift trade routes with China and Russia defeat America's high-tech naval blockade?
As central banks abandon the dollar for gold, why is this crisis making the US currency even stronger?
2026 Strait of Hormuz Crisis: Oil Supply Collapse, Price Surge, and the Global Economic Fallout
Overview
In May 2026, escalating tensions in the Middle East led to a major crisis when the M.V. Barakah, an ADNOC tanker, was struck by Iranian drones near Oman, causing a fuel leak and highlighting the ecological risks of the conflict. This attack, part of broader hostilities linked to the US and Israeli-led war, triggered ongoing disruption in the Strait of Hormuz—a vital oil shipping route. As a result, global oil supply fell sharply, with OPEC+ unable to meet demand, leading to record inventory drawdowns, soaring prices, and widespread economic and trade impacts worldwide.