Hormuz Closure Drives Oil to $93

Iran's military said on June 11 that the Strait of Hormuz was closed to commercial shipping, after new US strikes pushed a three-month confrontation into direct threats against tanker traffic (Reuters via Internazionale). Brent crude traded near $93 a barrel (Straits Times). Europe is not facing an immediate gas shortage. It is facing something more familiar to Maltese households and businesses: a price shock that arrives long before supply actually runs out.

The Global Bidding War

Hormuz normally carries roughly 20 million barrels of oil a day, about a quarter of all seaborne oil trade (EIA). Qatar, whose LNG leaves through the strait, supplied around 8.2% of EU LNG imports in 2025 (S&P Global).

That looks manageable on paper. It is not, because gas is priced in a global auction. If Gulf LNG cannot reach Asian markets, Asian buyers compete with European buyers for the remaining cargoes. The most expensive cargo needed to clear the market sets the price for everyone.

Europe's benchmark gas price, TTF, reached $14.80/MMBtu for the week ending April 24, 35% above pre-closure levels (EIA). The strait does not have to be fully sealed for that pressure to reach Europe. It only has to become risky enough for shipowners, insurers and charterers to decide the voyage is no longer worth the exposure.

Lloyd's Market Association data shows the change already under way. Since early March, only 111 cargo-vessel transits were recorded, with more than 60% believed to have an Iranian link or negotiated consent to pass (LMA). Hormuz has become a damaged corridor, where insurance costs, naval threats and political permission now decide who sails and who waits.

The market is adjusting, but not on Europe's terms. From March to May, the US share of EU LNG imports rose from 56% to 60%. Norwegian LNG to the EU jumped 84% year on year. Russian LNG rose 25% (Euronews). Europe is still finding gas. It is paying more for it, and buying more from suppliers it spent years trying to reduce its dependence on.

Emergency Stocks Won't Cover Prices

The European Commission, the EU's executive arm, requires gas storage to reach 90% before winter (Commission). ICIS warned in early June that if slow injection rates continued, EU storage would reach only about 73% by November, well below target before the heating season (ICIS).

The Gas Security of Supply Regulation, the EU framework for coordinating emergency response and protecting households during gas shortages, creates solidarity duties among member states. It cannot create LNG cargoes that are not there (EUR-Lex). For oil, EU law requires 90 days of emergency stocks, and the IEA can coordinate releases. These reserves matter if physical supply is interrupted. They do not cap the market price.

A Commission crisis-strategy document published this spring stated the problem plainly: 57% of EU energy still comes from imported fossil fuels, and the bloc has absorbed an additional €24 billion in energy-import costs since March (AccelerateEU).

Two Responses, One Bill

Member states face the same global price spike. Their political responses are not the same. Italy's foreign minister Antonio Tajani ruled out any solo military mission, saying deployment would require an EU or UN mandate and fresh parliamentary approval (Adnkronos).

Spain's Banco de España described the war's economic impact as "contained" in its central scenario. Its adverse scenario was much harsher: Brent at $145 and inflation at 6.8% (Cadena SER). Spain's foreign minister José Manuel Albares separately called for negotiation over military action (La Moncloa). The gap between the calm forecast and the severe one shows how little certainty European governments have.

The missing piece is the same across the continent. No government has published a clear exposure table showing which cargoes, contracts, terminals and storage positions depend on Gulf flows. The public debate is being conducted through scenarios and reassurance, while the cargo-level information remains with traders.

Until that changes, citizens cannot tell whether they are looking at a supply crisis, a price shock, or a maritime-security problem that mainly rearranges the global market. On the evidence available now, the price shock is already here. The unresolved question is whether storage can close the gap before diplomacy reopens the strait, or whether households enter winter carrying the cost of a corridor they will never see.