Global Energy Crisis: Hormuz Closure and War Disrupt Oil Supplies as OPEC Output Plummets

The global energy market remains in a state of severe crisis following the closure of the Strait of Hormuz and the outbreak of conflict involving Iran. This escalation is compounded by a massive collapse in OPEC production, which dropped by over 25% in March, severely tightening global supplies. In response to these systemic supply losses, ANZ has significantly upgraded its long-term oil price projections. The bank now expects Brent crude to reach $88 per barrel by year-end and remain above $90 throughout 2026, a sharp increase from its previous $80 estimate. While Kuwait's earlier price adjustments for Asian exports provided some context, geopolitical risks and production deficits now dominate the market narrative. Analysts warn that the combination of military conflict and record output losses poses an existential threat to global energy security. Global benchmarks Brent and WTI continue to react sharply as the risk of a prolonged supply deficit intensifies.