Hormuz closure period to shape impact on markets, ratings: S&P Global

S&P Global said the duration of Strait of Hormuz shipping halt will be critical in determining the impact on global oil, gas and petrochemicals markets, in terms of flows, disruptions, prices, and ultimately the effect on rated entities.

In a report, the agency said liquified natural gas (LNG) and oil exporters from GGC countries shipping through the strait would be the most affected.

The closure could also affect Saudi exporters such as Saudi Aramco (unrated) and Saudi Basic Industries Corp. (SABIC) (A+/Stable/A-1), it said.

S&P noted that alternative pipelines could help reroute some affected volumes. Saudi Arabia and the UAE have options to move crude, including the East-West pipeline in Saudi Arabia and the UAE-Oman pipeline.

A temporary closure of the strait could disrupt crude and LNG flows, while a prolonged shutdown would have wider effects on global energy markets and the oil and gas sector.

S&P estimates the geopolitical premium on oil prices could range between $5 and $20 a barrel in 2026, while prolonged supply disruptions could restrict access to about 20% of global crude and LNG.

The duration and scale of the Middle East conflict remain highly unpredictable, creating uncertainty around commodity prices, supply chains, as well as economies and credit conditions.

As the situation develops, the agency will assess the economic and credit significance of potential shifts and revise its outlook accordingly.