The IEA estimates that at least 10 million bpd of supply has already been shut in, making it the largest disruption the oil market has ever faced.
Refineries across the Gulf are reducing runs because products cannot be exported.
Diesel, jet fuel, and LPG markets are tightening sharply. Governments have responded with a record 400-million-barrel release from strategic reserves, but those barrels will arrive slowly while the disruption is happening now. At the same time, Tehran itself is sending mixed signals.
Iranian diplomats say the country does not intend to close the strait, while the new supreme leader has suggested the waterway will remain shut as leverage against the United States and its partners.
In practice, the effect is the same. Hormuz is effectively blocked, and until tankers can move safely again, the global oil market will remain under severe pressure.
Iran’s leadership structure is entering a period of real uncertainty following the death of Ayatollah Ali Khamenei.
The Supreme Leader has always served as the central node arbitrating among clerical institutions, security forces, and political factions.
Now that he’s gone, the state is functioning with overlapping centers of power that have not found a unified footing yet.
Contradictions are the new name of the game in Tehran. President Masoud Pezeshkian suggested Tehran might scale back attacks on Gulf states if their airspace was not used for U.S. strikes.
