The disruption in the Strait of Hormuz isn't a formal closure. Instead, shippers and producers are adopting a "wait and see" approach, halting flows due to reports of damaged ships and skyrocketing insurance premiums, effectively creating a self-imposed blockade.

Every 10 days the Strait of Hormuz is closed, a 200-million-barrel physical gap is created in the global oil flow. This is not a temporary kink but a massive hole in the supply chain that will take months to resolve and normalize, even long after transit resumes.

The 20 million barrels of oil flowing daily through the Strait of Hormuz represent 20% of global supply. A blockade constitutes a disruption four times larger than the Iranian Revolution or Yom Kippur War embargoes, with no simple replacement.

The war in Iran is choking the Strait of Hormuz, which handles 20% of global oil. This disruption impacts nearly three times more oil volume than Russia's exports at the start of the Ukraine war, posing a significantly larger threat to the global economy and inflation.

The Middle East conflict has moved beyond risk to a physical blockade of the Strait of Hormuz. With commercial tankers no longer transiting, nearly 20% of global oil is cut off from markets. This supply disruption, not just a risk premium, is driving oil prices toward $100/barrel.

While many fear production shutdowns, a more significant and probable risk is a logistical shock from shipping disruptions. Even modest delays in tanker transit times could effectively remove millions of barrels per day from the market, causing a significant price spike without a single well being shut down.

While options like releasing strategic reserves and tapping Saudi spare capacity exist, they are temporary stopgaps. These measures fall short of replacing the 20 million barrels per day—over 20% of global production—that flow through the Strait of Hormuz, making its security the paramount issue.

The primary threat to securing oil tankers is no longer just mines or fixed missile sites. It is the asymmetric threat of cheap, long-range drones that can be launched from the back of a truck, making them incredibly difficult and costly to defend against with traditional military systems.

The US cannot secure the Strait of Hormuz alone. The solution is a US-led military convoy that includes allies like Japan and South Korea, and even unconventional partners like China, who are heavily dependent on the oil route. This international presence creates a stronger deterrent and shares the burden.