Impact of Strait of Hormuz Closure: Global Energy Crisis 2026 and Indonesian Economy

The Strait of Hormuz is the world’s most strategically important maritime route, connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea. Escalating tensions in this region have again placed the global economy at significant risk. Should the Strait of Hormuz be closed, the following impacts would occur:

Approximately 20 per cent of total global crude oil consumption passes through this strait daily. A complete closure of the route is predicted to cause Brent crude oil prices to surge sharply beyond US$100 to US$150 per barrel. This is due to the sudden loss of 20-21 million barrels per day in supply, which cannot be replaced by other producers in the short term.

Indonesia, as a country still dependent on oil imports, would face substantial pressure. Asian nations such as China, India, Japan, and South Korea are the primary destinations (approximately 80 per cent) for oil passing through the Strait of Hormuz. China, as the world’s second-largest economy, imports nearly half of its crude oil requirements through this route. A closure of the strait would severely disrupt global manufacturing supply chains.

Although alternative pipeline routes exist in Saudi Arabia and the United Arab Emirates, their capacity is insufficient. The total capacity of alternative routes can only accommodate approximately 15-20 per cent of the volume normally passing through the Strait of Hormuz, and is therefore insufficient to mitigate the global crisis.

Business operators must restructure their business strategies for 2026. The Business & Legal Outlook 2026 highlights the role of cooperatives and navigating global geopolitical risks for entrepreneurs. Economists at Indef consider the government’s 6 per cent economic growth target for 2026 highly ambitious, with three major priorities including consumer purchasing power and manufacturing investment.