Iran’s move to block the Strait of Hormuz amid escalating military tensions is beginning to disrupt global oil flows, with early signs of strain emerging in South Korea, one of the world’s most import-dependent energy consumers.
Roughly a fifth of global oil supply typically passes through the narrow waterway, making it a critical chokepoint for energy markets. With shipments effectively halted for weeks and the risk of prolonged conflict rising after Washington issued warnings and Tehran signaled defiance, refiners across Asia are scrambling to secure alternative supplies.
The pressure is already visible in South Korea, where refiners rely heavily on Middle Eastern crude. About 70 percent of the country’s oil imports originate from the region, and the vast majority of those volumes transit the Strait of Hormuz. Recent tanker arrivals are now being viewed as among the last shipments to have cleared the route before the disruption took hold.
At a major refining complex on the country’s west coast, incoming crude is expected to cover only a few days of operations. Even when combined with earlier deliveries, total запас amounts to roughly a week, leaving companies with limited buffer as uncertainty over future shipments deepens.
Refiners are attempting to reroute supplies through alternative channels. S-Oil has begun sourcing crude via Saudi Arabia’s Red Sea port of Yanbu, leveraging its ties to majority shareholder Saudi Aramco. Other companies, including HD Hyundai Oilbank and GS Caltex, are exploring similar options, while pipelines linking the United Arab Emirates to the port of Fujairah offer another potential route.
These workarounds, however, fall short of replacing volumes typically flowing through Hormuz. Combined capacity from alternative routes is significantly lower than the roughly 20 million barrels per day that normally pass through the strait, raising the likelihood that refiners will have to reduce operating rates as early as next month.
Efforts to diversify supply beyond the Middle East offer limited relief. Crude from the United States, Canada and other regions is available but in smaller quantities and is less compatible with existing refining configurations, which are built around Middle Eastern grades. Without those base supplies, maintaining stable production becomes increasingly difficult.
The disruption is also rippling into South Korea’s petrochemical sector, which depends on naphtha feedstock derived from crude oil. With inventories typically covering about two weeks and a significant share sourced from the Middle East, producers have begun cutting utilization rates to conserve supply.
The broader impact could extend well beyond the country’s borders. South Korea is a key exporter of refined fuels and petrochemical products used in plastics, synthetic materials and industrial manufacturing. A sustained drop in output risks tightening global supply chains and adding to cost pressures for manufacturers.
While higher oil prices can initially boost refiners’ profits through inventory gains, the current disruption is eroding margins. Spot crude sourced outside the strait has surged in price, while shipping and insurance costs have climbed, increasing the burden on refiners already facing supply constraints.
For petrochemical producers, reduced output in the Middle East and disruptions to Iranian crude flows into China may tighten global markets for key chemicals such as ethylene and butadiene. That could support prices even as production slows, offering limited relief in an otherwise increasingly constrained supply environment.
