Oil Industry Braces for 'Real Panic' in June if Strait of Hormuz Remains Closed

Gas prices have surged 56% in the United States since the first U.S. airstrikes on Iran, but industry experts warn that a far more severe crisis is imminent if the Strait of Hormuz does not reopen by June.

The narrow waterway, through which about 20% of the world's oil passes, has been effectively shut down following recent military escalations. Analysts now predict a wave of panic buying, supply shortages, and price spikes that could dwarf the current increases.

"We haven't seen anything yet," said Dr. Elena Marchetti, senior energy analyst at Global Risk Advisors. "If the Strait remains closed into June, we will see real panic in the oil industry—not just traders, but producers, refiners, and governments."

The warning comes as Brent crude already trades above $120 per barrel, and U.S. average gasoline prices hover near $5 per gallon.

Background

Tensions in the Middle East escalated sharply after the U.S. launched a series of airstrikes on Iranian military facilities in late March. Iran responded by mining the Strait of Hormuz and deploying fast-attack boats, effectively halting commercial tanker traffic.

Since the first U.S. strike, U.S. gas prices have risen 56%, according to data from the Energy Information Administration. The impact has been felt globally, with Asian and European benchmarks also climbing.

The Strait of Hormuz is a 21-mile-wide chokepoint connecting the Persian Gulf to the Gulf of Oman. Any prolonged closure threatens to strangle supply from Saudi Arabia, Iraq, Kuwait, the UAE, and Iran itself—nearly 17 million barrels per day.

What Analysts Are Saying

Several industry observers have echoed Marchetti's assessment. "The market is already pricing in disruption, but the physical reality of empty storage tanks and delayed cargoes will hit in June," said Mark Thompson, former OPEC economist now at the Center for Global Energy Studies.

Thompson added: "Refineries are starting to ration output. If the Strait doesn't open by June 1, we could see spot prices double."

What This Means

For consumers, the immediate effect will be even higher prices at the pump. Average U.S. gasoline prices could exceed $7 per gallon by mid-June, according to preliminary modeling by the University of Chicago's Energy Policy Institute.

For the global economy, a prolonged closure would likely trigger a recession in import-dependent countries such as Japan, India, and South Korea. The International Energy Agency has acknowledged it may coordinate emergency stockpile releases, but those reserves are limited.

Oil companies are already scrambling to secure alternative routes and suppliers. Some are reactivating offshore fields in the Gulf of Mexico and the North Sea, but new production takes months to come online.

The underlying tension shows no sign of abating. Diplomatic backchannels remain open, but both sides have publicly hardened their positions. The window to avoid a full-blown oil crisis is closing fast.

As the June deadline approaches, the entire energy industry is watching the Strait of Hormuz with mounting alarm. What was once a distant risk has become an immediate, existential threat to global energy security.