which countries will be hit the most
Commercial ships anchored off the coast of the United Arab Emirates due to navigation disruptions in Dubai’s Strait of Hormuz on March 2, 2026.
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While the closure of the Strait of Hormuz by Iran creates shock waves in global energy markets, Asia is expected to face the greatest pain.
A senior commander in Iran’s Revolutionary Guard said on Monday: Strait of Hormuz closed and warned that any ship attempting to pass through the waterway would be targeted, Iranian media reported.
Located between Oman and Iran, the Bosphorus serves as a vital artery for global oil trade. According to energy consulting firm Kpler, around 13 million barrels per day will pass in 2025; this represents approximately 31% of all seaborne crude oil flows.
A prolonged closure of the strait will likely cause further increases in oil prices, with some analysts predicting oil will exceed $100 per barrel. Global benchmark Brent It was last around $80 per barrel, up 2.6 percent; it was almost 10 percent higher since the conflict began.
About 20% of global liquefied natural gas exports from the Gulf, primarily those from Qatar and shipped via the Strait of Hormuz, are also at risk, according to Kpler. Qatar, one of the world’s largest LNG suppliers, halted production on Monday after Iranian drones hit its facilities in Ras Laffan Industrial City and Mesaieed Industrial City.
“In Asia, Thailand, India, Korea and the Philippines will be the most vulnerable to high oil prices due to their high import dependency, while Malaysia will be a relative beneficiary as it is an energy exporter,” Nomura said in a note Monday. he wrote.
How will those dependent on Gulf energy and shipments via the Strait of Hormuz be affected by this situation?
South Asia: immediate physical strain
South Asia will face the most severe disruption, especially when it comes to LNG supplies, analysts said.
According to Kpler data, Qatar and the UAE account for 99% of Pakistan’s LNG imports, 72% of Bangladesh and 53% of India’s.
Pakistan and Bangladesh are particularly vulnerable due to limited storage and purchasing flexibility. First, Bangladesh currently has a severe structural gas deficit. according to Institute of Energy Economics and Financial AnalysisThe country is experiencing a deficit of over 1,300 million cubic feet per day.
“Pakistan and Bangladesh have limited storage and purchasing flexibility, meaning disruption is likely to trigger a rapid destruction of power sector demand rather than aggressive spot bidding,” Katayama said.
India faces the largest combined risk in the region. “More than half of LNG imports are Gulf-related and a significant part of them is Brent-indexed, so a crude oil rise from Hormuz will simultaneously increase both oil import costs and LNG contract prices. This creates a dual physical and financial shock,” he said.
Similarly, according to UBP, around 60% of India’s oil imports come from the Middle East. Therefore, a permanent blockade will increase both energy import costs and current account pressures.
China: Big risk but enough buffer
Closing Hormuz will test China’s energy security, but stockpiles and alternative supplies provide some buffer.
The country is the world’s largest importer of crude oil and buys more than 80% of Iran’s oil, according to Kpler.
According to UBP’s estimates, about 30 percent of LNG imports come from Qatar and the UAE, and about 40 percent of oil imports pass through Hormuz.
“China is financially exposed but more flexible,” said Kpler’s Katayama.
According to Kpler, China’s LNG stocks stood at 7.6 million tons as of the end of February, which provides short-term protection. But Katayama added that if the disruption continues, China will have to compete for Atlantic cargoes, narrowing the Pacific basin. In this case, the dynamic could intensify price competition across Asia even if Beijing avoids outright shortages.
Saudi Arabia has increased crude oil loadings in recent weeks and strategic oil reserves held by major oil-consuming countries such as China could provide some temporary cushion to the market, Rystad Energy said in a note Sunday.
UBP said that although China is a significant net energy importer in the region, it is not the country most vulnerable to potential supply shocks.
Japan and South Korea
According to UBP, the Middle East provides 75% of Japan’s oil imports and about 70% of Korea’s.
For LNG, the risks in the Gulf are lower than those in South Asia. Kpler estimates that South Korea sources 14 percent of its LNG from Qatar and the UAE, while Japan supplies 6 percent.
Even if there is no outright shortage, the price impacts can be severe. “Economies with high import dependence on energy, such as Japan, South Korea and Taiwan, are more exposed to supply shocks,” said Shier Lee Lim, macro and currency strategist at APAC’s payment platform Convera.
Stocks are also limited. According to Kpler, Korea has approximately 3.5 million tons of LNG reserves and Japan has approximately 4.4 million tons of LNG reserves; This is enough for about two to four weeks of stable demand.
South Korea’s net oil imports account for 2.7 percent of GDP, and Nomura ranks it among the most vulnerable countries on the current account front.
Southeast Asia
Industry experts said the initial hit in much of Southeast Asia was cost inflation rather than a sudden shortage.
Kpler’s Katayama said spot-dependent LNG buyers will face much higher replacement costs as Asia competes with Europe for Atlantic cargoes.
Thailand is a particularly glaring oil price loser in Nomura’s framework because the external blow is large and immediate: it has the largest net oil imports in Asia, at 4.7% of GDP, and every 10% increase in oil prices worsens the current account deficit by about 0.5 percentage points of the country’s GDP.
