Gulf States Face $15 Billion Revenue Loss Amid Hormuz Disruption

Gulf oil producers have experienced an estimated $15. 1 billion reduction in energy revenues since the commencement of US and Israeli strikes on Iran.

This revenue loss is attributed to the near-shutdown of the Strait of Hormuz, a critical shipping route.

Traffic through the Strait of Hormuz has significantly decreased since February 28, following Iranian attacks on vessels and a subsequent increase in insurance premiums. The strait typically facilitates approximately $1.2 billion in daily trade of crude oil, refined products, and liquefied natural gas.

Crude oil accounts for 71% of the value of halted shipments. Saudi Arabia, as the largest oil exporter, has incurred an estimated $4.5 billion in losses. Iraq is particularly vulnerable, with oil production comprising 90% of its government revenues.

Kuwait and Qatar, while exposed, possess substantial sovereign wealth funds to mitigate short-term financial impacts. An estimated $10.7 billion worth of crude, refined products, and LNG cargoes are currently stranded within the Strait of Hormuz.

Saudi Aramco has indicated the potential to reroute 70% of crude shipments from eastern oilfields to the Red Sea via its east-west pipeline. However, analysts note this system has not previously operated at such capacity.