What countries are most at risk from trade disruption amidst Iran-Israel conflict

Four Asian countries account for the majority of oil and has flowing through the Strait of Hormuz.

Two Asian countries are the most vulnerable to supply shocks as they greatly rely on the Strait of Hormuz to transport their oil and gas supply.

According to a new report by Zero Carbon Analytics, China, India, Japan, and South Korea account for 75% of oil and 59% of liquefied natural gas (LNG) flows through the Strait of Hormuz.

However, Japan and South Korea “are the most vulnerable to supply shocks, sourcing 87% and 81% of their energy from fossil fuel imports.”

Around 20% of the world’s oil and LNG passes through the two-mile-wide shipping lanes in the Strait of Hormuz. However, Iran’s ongoing conflict with Israel has pushed it to reportedly consider blockading the shipping route.

“Our analysis reveals Japan is uniquely vulnerable to such a disruption, given its significant reliance on fossil fuel imports. South Korea, India, and China also face high risks,” Zero Carbon Analytics Head of Energy Transition Murray Worthy said.

“This crisis underscores the urgent need for oil and gas importers to pivot from volatile fossil fuels to reliable domestic renewable energy for economic stability and energy security,” he added.