Back to overview Home Fossil Energy Strait of Hormuz closure: Tight LNG markets, oil prices could soar to $200 Strait of Hormuz closure: Tight LNG markets, oil prices could soar to $200 Market Outlooks May 27, 2026, by Melisa Cavcic Share this article With more than 80 million tonnes per annum (mtpa) of liquefied natural gas (LNG) supply, representing around 20% of global supply, being inaccessible to global markets, the Strait of Hormuz closure has the potential to spark the biggest energy supply shock in decades, according to Wood Mackenzie, an energy intelligence group, which emphasizes that oil prices could reach $200 a barrel (bbl) in a worst-case scenario, as over 11 million barrels per day (b/d) of Gulf crude and condensate supply continues to be curtailed. Illustration: Source: Wood Mackenzie Wood Mackenzie’s new Horizons report highlights that a prolonged closure of the Strait of Hormuz  poses the single greatest threat to global energy markets in decades, while outlining three distinct scenarios: ‘ Quick Peace ,’ ‘ Summer Settlement ,’ and ‘ Extended Disruption ,’ which offer a different timeline for ending the conflict and reopening the waterway, as the firm assesses the potential impact  on oil and gas supply , prices, energy demand, and the broader global economy. Peter Martin , Head of Economics at Wood Mackenzie, commented: “The Strait of Hormuz is the most critical chokepoint in global energy markets, and a prolonged closure would become far more than an energy crisis . The longer disruption persists, the greater the impact on energy prices, industrial activity, trade flows and global economic growth.” Within the ‘ Quick Peace ’ scenario, a workable peace agreement is reached in the near term, and the Strait reopens by June, enabling the global economy to broadly return to its pre-war trajectory by Q4 2026. As a result, crude prices end up falling sharply following a deal, with Brent easing to ar