The Strait of Hormuz crisis has shown that an energy shock is no longer only a question of higher petrol and diesel prices. It can quickly become a test of shipping infrastructure, refinery resilience, fuel substitution, strategic reserves and the ability of governments to keep essential supplies moving. For India, one of the world’s large energy importers, the disruption has exposed how much energy security depends not only on the availability of crude oil and gas, but also on the safety of the routes carrying them.
According to the McKinsey Global Institute (MGI), around 14% of global oil and gas supply was affected at the peak of the 2026 crisis. The report described the disruption as more than twice the size of the major oil shocks of the 1970s and nearly six times larger than the disruption caused by the Russia-Ukraine conflict in 2022. Those comparisons place the crisis in a wider category than a temporary rise in international crude prices: it became a stress test for the infrastructure and trading systems supporting the global energy economy.
The importance of the Strait of Hormuz comes from the volume and concentration of energy flows through it. In the fourth quarter of 2025, about 21 million barrels of oil a day passed through the strait, including roughly 16 million barrels of crude and 5 million barrels of refined petroleum products. That made Hormuz a central link between energy producers and consumers across Asia and other markets. A major obstruction in the passage can therefore affect crude, refined products, natural gas and the industries that depend on them at the same time.
The crisis also showed why the global energy system did not collapse even when a substantial volume of supply was disrupted. MGI estimated that about 45% of the oil supply removed from the market during the crisis was offset through lower consumption. This amounted to approximately 6.8 million barrels per day. China reduced its oil imports, while the United States increased exports, altering trade flows and helping absorb part of the shock.
That adjustment, however, was not evidence of unlimited flexibility. It depended on consumers using less, inventories being drawn down and available supply being redirected from other locations. Prices rose, stockpiles declined and refinery systems came under pressure. These responses bought time, but they also revealed the limits of the buffers available to the market.
Alternative infrastructure provided some relief but could not easily replace the entire disrupted flow. Saudi Arabia’s East-West pipeline, one of the routes intended to bypass Hormuz, itself experienced disruption during the crisis. Its vulnerability demonstrated that an alternative route is not automatically a secure route. The capacity of a pipeline, its location, its connections to ports and refineries, and its ability to operate during a simultaneous shock all determine whether it can function as a meaningful backup.
This is the central infrastructure lesson of the crisis. Energy security is not created simply by adding one pipeline, one port or one new shipping arrangement. It depends on a network of routes and facilities that can work together under pressure. A backup asset that is rarely used during normal conditions may be strategically valuable during a crisis, but its effectiveness will depend on whether it has sufficient capacity, operational readiness and connectivity to the wider system.
The exposure is not limited to Hormuz. MGI estimates that about two-thirds of global energy trade moves through maritime chokepoints. The Strait of Malacca carries approximately 23 million barrels of oil and refined products each day, while Hormuz carries about 21 million barrels. The Cape of Good Hope, the Suez Canal, the Turkish Straits, Bab al-Mandeb and the Panama Canal are also important to global energy movement.
Each route presents a different combination of geographic and infrastructure risk. Recent tensions in the Red Sea and Yemen have already shown how ships may be forced to take longer routes when a maritime corridor becomes unsafe. Longer journeys increase sailing time and transport costs, while also tying up ships and potentially delaying deliveries to refineries and industrial users. A disruption can therefore spread beyond the location where it begins, affecting freight, inventory planning and fuel markets elsewhere.
For India, the implications are particularly significant because the country is a major energy importer. A crisis around Hormuz can affect crude supplies, liquefied natural gas markets, refinery operations and the cost of transporting energy. The country’s response capacity depends on several elements working together: diversification of crude suppliers, strategic petroleum reserves, alternative shipping routes, domestic refining capacity and the ability to shift between fuels when one source becomes expensive or unavailable.
The crisis also showed that fuel markets cannot be examined in isolation. Asian spot LNG prices, which were around $10 per million British thermal units before the conflict, rose to approximately $30. As gas became more expensive, buyers including India moved towards coal and oil where possible. This demonstrates how a disruption in one part of the energy system can increase demand and prices in another. Fuel substitution may provide short-term relief, but it can also transfer pressure from gas markets to coal, oil, shipping and emissions-intensive infrastructure.
India and China may have some ability to absorb oil and gas shocks through the availability of coal, according to the MGI assessment. But the same assessment points to a deeper limitation: around 84% of the energy trade of both countries moves through maritime chokepoints. Alternative fuels can reduce dependence on a particular commodity, but they do not remove dependence on the sea routes through which energy and other industrial inputs are transported.
This distinction matters for energy policy. Diversification is often measured by the number of suppliers or the mix of fuels in a country’s energy basket. The Hormuz crisis shows that route diversification must be assessed alongside those indicators. A country may buy crude from multiple producers and still face a common vulnerability if much of that supply passes through the same narrow maritime corridor.
The same applies to strategic reserves. Stockpiles can cushion an immediate supply shock, but they do not permanently replace imports or resolve a prolonged route disruption. Their value depends on their size, location, release mechanisms and connection to refineries and distribution networks. Similarly, domestic refining capacity can help convert available crude into usable products, but refineries cannot operate without feedstock and secure logistics.
MGI estimates that bypass pipelines, alternative oil and gas supplies, electrification and greater energy-source diversification could cover between 35% and 70% of the oil flows that passed through Hormuz by 2030 in the event of another major disruption. That would represent roughly 7 million to 15 million barrels per day, or about 7% to 15% of global oil supply. The range itself reflects the difficulty of building resilience: the outcome depends on the capacity and location of infrastructure, the availability of alternative fuels and the ability to redirect trade quickly.
For policymakers, the challenge is therefore broader than preparing for a single geopolitical incident. It involves designing an energy system that can withstand simultaneous pressure on shipping routes, inventories, refineries and consumer demand. Infrastructure that appears underused in normal times may become essential during a crisis, while infrastructure built without adequate connections may fail to provide practical redundancy.
The Strait of Hormuz crisis confirms that global energy security is also a question of urban and economic resilience. Higher fuel and gas prices can affect transport, manufacturing, construction, electricity generation and household budgets. The evidence supplied in the MGI assessment establishes the scale of the exposed network, but it does not establish that any single country can fully eliminate maritime risk. The developments to monitor are the expansion of strategic reserves, the creation and testing of bypass capacity, diversification of energy imports, and the pace at which electrification can reduce dependence on vulnerable fuel corridors.
