Hormuz Crisis Costs Importers $330 Billion in Six Months
A new analysis from the Centre for Research on Energy and Clean Air (CREA) quantifies the financial toll of the Hormuz crisis on fossil fuel importers. In the six months following the US-Israel strikes on Iran, importers paid a gross extra cost of USD 330 billion for seaborne crude oil, oil products, and LNG, compared with what pre-war futures markets had expected. This represents the largest sustained oil price shock since the 1990 Gulf War.
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According to the report, Asian LNG prices averaged 75% above pre-war expectations during the first six months, European LNG 60% above, diesel 59% above, and crude oil 35% above. In absolute terms, the European Union faced the highest gross additional cost at USD 78 billion, followed by China at USD 35 billion and India at USD 22 billion. The typical low- or middle-income country paid about twice as much relative to GDP as the typical high-income country.
The analysis also highlights the mitigating role of clean energy. In the first five months of the crisis, clean power generation added since 2020 saved importing countries an estimated USD 36 billion in avoided coal, gas, and oil imports. This includes USD 22 billion in gas, USD 10 billion in coal, and USD 5 billion in oil. About 29% of these savings (USD 10.6 billion) are attributed solely to the war, as prices ran above pre-war expectations.
Prices have not returned to pre-war levels. Brent crude oil peaked at almost double its pre-strike level and has averaged 38% above it since. Diesel and gas prices remain elevated, with diesel averaging USD 161 per barrel against a pre-war expectation of USD 101. European gas prices moved from 44% above expectations in June to 76% in August, while Asian LNG rose from 64% to 98%.
The burden fell unevenly across regions. Europe and East Asia absorbed most of the cost, with the EU paying an additional USD 54 billion net and East Asia USD 49 billion. In contrast, the Middle East, North America, Russia, and Latin America came out ahead, earning more from higher prices than their importers paid. Russia benefited significantly, with export revenues boosted after a low in January 2026.
For cooking gas, India, the largest LPG importer, paid 29% more per tonne than expected and imported 26% less. The extra cost for the six months is estimated at USD 1.1 billion, with a standard 14.2kg cylinder costing about USD 8.1 at import parity versus USD 6.28 expected.
The methodology compares actual prices against the futures curve from 16-27 February 2026, the 12-day period before the strikes. The analysis excludes pipeline gas, coal, fuel oil, naphtha, freight, and war-risk premiums, making the estimates conservative. Around USD 6 billion of cost could not be attributed to specific countries due to data gaps.
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