Squiz Today Squiz Shortcuts: The oil supply chain
Mar 19, 2026
A clear walk-through of how the Strait of Hormuz shapes global oil flows. A look at tanker attacks, supply disruptions and why prices spike locally. Exploration of oil uses beyond fuel and how crude is refined and transported. Discussion of Australia’s shrinking production, emergency reserves and the scramble for alternative suppliers.
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Strait Of Hormuz Is A Global Oil Chokepoint
- A third of the world's crude oil and a fifth of LNG transit the Strait of Hormuz, making it a critical chokepoint for global energy supplies.
- The strait's narrowest point is 33 km and attacks on tankers by Iran have drastically reduced daily tanker traffic from ~50–60 large tankers to near zero.
Oil Price Spike From Supply Squeeze
- Reduced supply from the Hormuz disruptions pushed Brent crude from about US$70 to roughly US$103 per barrel, illustrating immediate price sensitivity.
- Higher oil prices quickly ripple into consumer costs and market anxiety, drawing rapid political and economic attention.
Australia Relies On Asian Refineries
- Australia sources most refined fuel via giant Asian refineries in Singapore, Malaysia and South Korea rather than directly buying crude from the Middle East.
- Domestic production fell ~90% since 2000 so importing refined fuel is now economically preferable to running ageing local refineries.