Nomura: Full U.S. Blockade Could Cut Off Another 2.3 Million Bpd Oil Supply

Oil supply from the Middle East could drop by another 2.3 million barrels per day (bpd) if the U.S. were to completely block the Strait of Hormuz, according to bank Nomura.

“We estimate around 2.3mbpd loss of incremental oil supplies versus March 2026, and nearly 9.3mbpd loss versus March 2025 in the event the US were to completely block the SoH,” analysts at Nomura wrote in a research note carried by Business Standard.

“A complete blockade of the SoH may also impact LPG supplies for India, as over the past month India managed to have several LPG tankers (at least eight) safely crossed through the strait,” Nomura analyst Bineet Banka wrote.

Some Indian tankers carrying LPG have cleared the Strait of Hormuz in recent weeks despite the de facto closure of the critical oil and gas chokepoint.

India has also imported its first Iranian crude cargo in seven years, as the U.S. last month allowed purchases of Iranian oil already loaded on tankers.

In recent weeks, India has negotiated with Iran the safe passage of some energy supplies through the Strait of Hormuz, especially cargoes of liquefied petroleum gas (LPG), which is widely used for cooking in India.

However, it is highly uncertain how the U.S. blockade and the move to block Iranian ports would impact the oil flows through the world’s most important energy flow chokepoint that used to handle 20% of global daily oil and gas flows before the war.

Even if the Strait of Hormuz opened today without any restrictions and risks, oil and gas supply from the Middle East faces recovery of several months well into the late summer, according to Wood Mackenzie.

But this is contingent on an operating Strait of Hormuz.

Goldman Sachs last week warned that Brent Crude prices are set to average above $100 per barrel this year if the Strait of Hormuz remains mostly shut to tanker traffic for another month.

By Charles Kennedy for Oilprice.com

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