GULF WAR - WHO WINS AND WHO LOSES FROM THE STRAIT OF HORMUZ - Filenews 3/3
By Scott Montgomery
The war in the Persian Gulf has nearly wiped out navigation through the Strait of Hormuz, a major global bottleneck for oil and gas trade. The first signs are mixed in terms of the magnitude and duration of the price increase in global markets, especially for oil. President Trump said the war could last a month.
Another equally important question is who will be the winners and losers if the war continues and, above all, if it involves attacks on oil export infrastructure. Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Iraq and Iran itself are heavily dependent on the Strait of Hormuz, as are their main customers.
Oil prices and uncertainty
To say that investors feel nervous about the future would be an understatement. No one expected such a sudden and large-scale attack by the US and Israel, let alone one that would kill Iran's supreme leader, Ali Khamenei, as well as important military leaders. Also, based on Iran's response to airstrikes in mid-2025, perhaps investors did not expect such a large-scale missile and drone counterattack against the Arab Gulf countries that support US military forces.
War brings chaos and this time is no exception either. Trump may have said that Iran's new leadership wants to "talk," but the attacks are escalating. The US military claims to have sunk nine Iranian warships, while Iran insists it has closed the sea route and targeted tankers.
Forecasts for the course of oil prices in the coming days or weeks vary significantly: from a slight rise to $80 to a jump above $100. The first scenario is less likely, but there are arguments for both developments. A lot depends on what happens in the coming days.
History and experience show that no oil crisis is a model for predicting the next ones. Market conditions are different each time and the psychology of traders changes accordingly. Wartime oil price predictions are usually worth what we pay for them (or even less).
Winners and losers if the war continues
However, the current geopolitics of oil and gas, however complex it may be, will have winners and losers from this war.
Russia is the first among those that could benefit from a significant increase in prices, as its economy and its own war in Ukraine depend on exports of hydrocarbons, mainly crude oil. At the same time, Iran is a key ally that has helped the Kremlin acquire new drone technology and factories to build them.
Other beneficiaries will be exporters who do not cooperate with Iran and are not located west of the Strait of Hormuz. These include OPEC+ member states such as Brazil, Australia and Guyana, as well as Canada and the US. In the cases of Canada and the US, however, the benefits will mainly go to the oil industry and related services, while higher fuel prices will not be welcomed by consumers. Indeed, they could be a serious political burden for Trump and the Republicans in the 2026 US midterm elections.
Who, then, have to lose? East Asia, India and, to a lesser extent, Europe.
China, Japan, South Korea, and Taiwan stand out in this category. China is not just the world's largest importer of oil. In addition, more than 50% of its imports come from Gulf countries, especially Saudi Arabia, Iran, Iraq and Kuwait (in that order). The other three countries as importers are even more exposed: 70% (South Korea) to 80% (Japan) of the oil they use passes through the Strait, mainly from Saudi Arabia, the UAE and Kuwait. Overall, the Strait of Hormuz could be called the "oil channel" of East Asia.
India is also expected to be negatively affected, with Iraq, Saudi Arabia and the UAE supplying 45%-50% of its crude oil imports. That figure has risen in 2026, with US sanctions forcing Indian refiners to limit the use of Russian oil.
As for the EU, which is currently the world's second-largest importer of crude oil, it is less exposed to risks, but not exempt. Imports from Gulf states have been significant in filling the gap created by massive cuts in Russian crude, with the EU planning to phase it out completely in 2027. The top oil suppliers now include Norway (14.6%), the US (14.5%) and Kazakhstan (12.2%), with Saudi Arabia, Iraq (~10%) and a number of other non-Gulf exporters filling the remaining quantity.
But what impact would a price of $100 a barrel have on the global economy? It would hurt consumers not just in the US, but everywhere. Oil is still counted on the price of all goods: food, electronics, clothing, medicines, and so on. Rising oil prices would come as another shock to investors, who have already been plagued by constant tariff changes, the invasion of Venezuela and threats against Greenland and Cuba.
The risk is shared among exporters
The Gulf states have long realized that their security is directly linked to the Strait of Hormuz. Their economies, prosperity, and stability depend on oil and gas exports through this sea route. The so-called "tanker wars" of the 1980s, part of the violent conflict between Saddam Hussein's Iraq and Iran under Ayatollah Khomeini, proved that there are several ways to close the Strait or restrict the passage of ships through the region.
A military blockade or attacks with ships, mines, missiles and now with drones are the obvious way. More than 400 ships were damaged in the Gulf and, although commercial traffic decreased, it continued throughout that 10 years and was protected by the US in the last phase of the war. There is always the risk of a direct military attack on tankers and the detention of crews. The conflict of the 1980s highlighted the role of insurance companies, which increased premiums by up to 50%, causing some companies to redirect their ships.
As a result of Iran's repeated threats to close the Strait of Hormuz, Persian Gulf states have built pipelines that bypass it. Such as Saudi Arabia's Yanbu pipeline to the Red Sea, the United Arab Emirates' Fujairah pipeline to the Gulf of Oman, Iran's Goreh-Jask pipeline (!) and the Bandar-e Jask energy export terminal, on the north coast of the Gulf of Oman. What could the first two achieve? At most, they will channel a quantity equivalent to 1/4 of the 21 million barrels per day traded through the Strait of Hormuz. In short: not much.
The new war in the Persian Gulf, regardless of its outcome, is already threatening global energy security.
