Wood Mackenzie: Hormuz Closure Could Send Oil to $200

title	Wood Mackenzie: Hormuz Closure Could Send Oil to $200 — Three Scenarios
source	gCaptain / Wood Mackenzie Horizons Report
author	Peter Martin (Head of Economics, Wood Mackenzie); Massimo Di Odoardo (VP Gas & LNG Research)
date	2026-05-21

Key Claims

Three scenarios: Quick Peace ($80), Summer Settlement ($120-150), Extended Disruption ($200)
11+ mb/d Gulf crude and condensate production curtailed
80+ mt/yr LNG supply (~20% of global) inaccessible
Extended disruption: Brent approaches $200/bbl by end-2026
Diesel and jet fuel could reach $300/bbl in major refining centers
Global economy could contract 0.4% in 2026 — third global recession this century
Middle East GDP could shrink 10.7%; EU GDP -1.5%; US growth <1% in 2026-2027
Some Gulf LNG capacity could be permanently lost; 75 mt/yr projects under construction face multi-year delays
Quick peace: Brent falls to ~$80 by year-end, ~$65 in 2027

Source: gCaptain / Wood Mackenzie Horizons Report — May 21, 2026

Author: Peter Martin (Head of Economics), Massimo Di Odoardo (VP Gas & LNG Research)

Current Disruption Scale

11+ mb/d Gulf crude and condensate production curtailed
80+ mt/yr LNG supply inaccessible (~20% of global supply)

Three Scenarios

Scenario 1: Quick Peace

Strait reopens by June
Global economy returns to pre-war trajectory by Q4
Brent: ~$80/bbl by year-end, ~$65 in 2027
Markets return to oversupply

Scenario 2: Summer Settlement

Strait largely closed until September
Oil and LNG shortages persist through Q3
Brent: $120-150/bbl range
Shallow global recession in H2 2026

Scenario 3: Extended Disruption

Strait remains largely closed through year-end
Brent approaches $200/bbl by end-2026
Despite global oil demand falling 6 mb/d YoY in H2
Diesel and jet fuel: $300/bbl in major refining centers
Global GDP contracts 0.4% in 2026 (third global recession this century)
Middle East GDP: -10.7%
EU GDP: -1.5%
US growth: <1% in both 2026 and 2027

LNG Dimension (Unique to WoodMac)

Even in quick-peace case, LNG markets remain tight through summer 2027
Gulf export facilities need time to recover; new supply projects face delays
In extended disruption:
Some of Gulf's 85 mt/yr existing LNG capacity could be permanently lost
~75 mt/yr of projects under construction could face multi-year delays
Would accelerate diversification away from imported LNG
Supports coal resilience and faster growth in renewables/electrification

Significance

Wood Mackenzie's three-scenario framework provides the most structured analytical lens for the Hormuz crisis. The $200 worst-case is grounded in supply/demand math (6 mb/d demand destruction still insufficient to offset supply loss). The LNG dimension is unique — no other source has quantified the 80 mt/yr LNG gap and its structural implications for global energy transition.

The permanent LNG capacity loss scenario is a structural long-term concern that extends beyond the immediate crisis.

Wood-Mackenzie-Hormuz-Scenarios-Jun-2026.md