Saudi Aramco warns that continued disruptions to shipping in the Strait of Hormuz will have “catastrophic consequences.”
The Strait of Hormuz has severely disrupted oil and gas transport due to the conflict between the US, Israel, and Iran. Saudi Aramco President and CEO Amin Nasser warned on the 10th that continued shipping disruptions will have “catastrophic consequences” for the oil market and “serious impacts on the global economy.”
Nasser stated that the war has triggered “serious chain reactions beyond shipping” and a “violent domino effect,” also affecting aviation, agriculture, automobiles, and other industries.
Nearly 17% of the world’s oil supply is transported through the Strait of Hormuz. Nasser noted that most of the world’s spare oil production capacity is concentrated in the Middle East, specifically in the strategically vital choke point near Iran’s west coast. Therefore, restoring traffic through the Strait of Hormuz is crucial to ensuring international crude oil supplies.
“This will have a catastrophic impact on the global oil market. The longer the disruption lasts, the more severe the impact on the global economy will be,” Nasser added, describing this as the biggest crisis the region’s oil and gas industry has faced to date.
Saudi Aramco is the world’s largest oil producer and exporter. Nasser stated in an investor conference call that global inventories are already at a five-year low amid the current geopolitical crisis and are expected to decline at an even faster pace.
To address the evolving regional crisis, Saudi Aramco has developed contingency plans for various possible scenarios and is making every effort to ensure crude oil supply.
Nasser stated that Saudi Aramco’s maximum continuous daily production capacity has reached 12 million barrels, and the company is maximizing the use of the East-West pipeline to maintain supply. This pipeline has a capacity of nearly 7 million barrels per day, partly used to supply oil to the Yanbu refinery in western Saudi Arabia, and the remainder for export.
Saudi Aramco’s earnings report released that day showed that, affected by factors such as increased global oil supply and US tariffs, the company’s adjusted net profit for 2025 is approximately $104.7 billion, a decrease of 5.1% compared to the previous year.
Due to shipping disruptions in the Strait of Hormuz, major oil-producing countries are being forced to cut production. ING analysts point out that even if shipping resumes, upstream production recovery will take time. With no signs of easing in the conflict, oil supply may face the risk of long-term disruption.
