The global energy landscape is facing an unprecedented crisis as three vital oil supply routes—the Strait of Hormuz, the Bab al-Mandeb strait, and Saudi Arabia’s strategic East-West Pipeline—face severe disruptions and closures. As one of the world’s leading oil importers, heavily reliant on Gulf shipments alongside Russian imports, India and the global economy are feeling the intense shockwaves of ongoing geopolitical turmoil. The Strait of Hormuz, which traditionally handles roughly 20 percent of global oil supplies, has been blocked since February due to escalating conflicts between Iran and the United States. Compounding this crisis, persistent attacks by Houthi rebels have virtually paralyzed maritime traffic through the Bab al-Mandeb strait, while fresh drone strikes have forced Saudi Arabia to shut down its primary 1,200-kilometer East-West Pipeline bypass system.
Saudi Arabian Production Plummets to Lowest Levels Since 1990 Amid Escalating Geopolitical Risks
The shutdown of the massive Saudi pipeline—which historically transports between 4 million and 5 million barrels of crude daily across the Arabian Peninsula to the Red Sea port of Yanbu, accounting for up to 5 percent of global supply—has severely restricted alternative export routes. Recent data submitted by Britain to OPEC on September 11 reveals a staggering month-on-month collapse in production of approximately 1.9 million barrels per day, bringing output down to 8.1 million barrels per day in July and wiping out previous short-term gains. With multiple chokepoints sealed off and production slumping to levels unseen since 1990, financial markets and energy experts warn that sustained disruptions could trigger a severe global oil crisis and propel crude prices significantly higher.