By Mark Jaffe, EUCI energy writer
The sea lanes vital to the global oil market are under pressure from geopolitical events as shipments through five critical maritime “chokepoints” drop and insurance rates rise, according to a Rystad Energy analysis.
In 2023, more than 71 million barrels a day (bpd) of oil and 26 billion cubic feet per day (Bcfd) of natural gas passed through the narrow sea routes in the Middle East, the Indian Ocean, and Africa. By 2025, oil shipments were down 9%, and gas shipments dropped nearly 5%.
The decline is a “clear sign of rising instability in some of the world’s most strategically important waters,” Rystad Energy said.
Some of the decline is linked to “temporary shocks,” such as Houthi attacks from Yemen on the Strait of Hormuz or Isreal-Iran tensions, but Rystad said there are signs of a “longer-term structural shift.”
The shift includes shipments being rerouted through the Cape of Good Hope and alternative pipelines. The maritime risks are already being priced into insurance premiums and freight rates.
“We have identified the five chokepoints most at risk, assessed the threats they face, and outlined the far-reaching consequences for global energy markets,” Mrinal Bhardwaj, a Rystad senior analyst, said in a statement.
“Any disruption at these chokepoints could shatter supply chains, trigger sharp spikes in energy prices, and inflict severe economic damage worldwide,” Bhardwaj said.
About three-fourths of the world’s oil is transported through maritime chokepoints, with approximately one-fourth passing through the Strait of Malacca and one-fifth shipped via the Strait of Hormuz.
The U.S., with its growing domestic production, remains less exposed than Asia and Europe, which rely heavily on the Strait of Hormuz and the Strait of Malacca for transport. China is particularly vulnerable.
The Strait of Malacca – which sees 24 million bpd of oil and gas flow daily through the waterway – is the biggest chokepoint.
The strait, a narrow passage between the Indian Ocean and the Pacific Ocean, is the main path for transporting most of the Middle Eastern crude oil and liquefied natural gas to Asia, including China and Japan.
Since the pandemic, oil and gas shipments through the strait have increased about 10%, even though the route is vulnerable to piracy and theft.
In the first six months of 2025, there were 80 incidents of piracy and armed robbery in the straits compared to 21 cases in the same period in 2024, according to the ReCAAP Information Sharing Centre.
A full closure of any major chokepoint would trigger extreme price volatility and test the resilience of global energy supply chains, Rystad Energy said.
The Strait of Hormuz, between Iran and Oman on the north and the United Arab Emirates on the south, is the conduit for about a fifth of the world’s maritime oil and condensate trade. About 14 million bpd pass through the waterway to major Asian markets.
After the Strait of Hormuz, the Bab el-Mandeb Strait – connecting the Red Sea with the Gulf of Aden and the Arabian Sea – is the Middle East’s second chokepoint. It is a key link between the Suez Canal and the Indian Ocean.
About 12% of global maritime trade passed through the Bab el-Mandeb Strait before the surge in Houthi attacks began in December 2023. Shipping volumes were cut in half within six months and have remained depressed.
A fourth chokepoint and another key link for global trade, is the Turkish Straits, a narrow maritime route connecting the Mediterranean Sea and the Black Sea, through the Bosporus and Dardanelles waterways.
The strait is fully controlled by Turkey, which gets about one-sixth of the crude oil passing through the waterway. Russia is the largest source of oil traffic, accounting for around 40 percent of the crude transported.
However, during the past few years, oil and gas shipments have fluctuated with volumes dropping in 2020, in the wake of the COVID-19 pandemic, and again in 2021 because of the Russia-Ukraine war, which cut Ukrainian exports an estimated 100,000 bpd.
Between 2020 and 2022, shipments dropped 9% to 3.2 million bpd.
Trade has rebounded. In 2023, about 5% of global maritime oil trade – 3.5 million bpd of crude oil and 0.5 Bcfd of gas – passed through the strait. Similar volumes are forecast for 2025.
The Cape of Good Hope, located at the southern tip of South Africa, “has emerged as a critical alternative route for global maritime trade, now handling 8% to 10% of worldwide shipping traffic,” Rystad Energy said.
In 2024, as Houthi attacks in the Middle East chokepoints spurred shipping to seek alternate routes, Cape of Good Hope oil traffic grew nearly 50 percent to 8.7 million bpd.
About 40 percent of the crude transported via the cape was destined for China, with about one-third originating from the U.S. and nearly one-fourth from South America.
“Despite higher freight costs and longer transit times, traders increasingly prefer the Cape of Good Hope due to its lower security risks. Compared to other global chokepoints, it currently represents one of the safest maritime routes for crude oil transport,” Rystad Energy said.
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