Before the conflict began on 28 February 2026, about a fifth of the world's crude and LNG supply passed through the strait. Since then, every company in the Gulf — from a Riyadh distributor to a Dubai restaurant group — has been doing business inside the world's most-watched supply shock.
What is happening in the Strait of Hormuz?
Traffic through the strait has swung sharply all year. According to Al Jazeera, citing Kpler data, Gulf oil flows recovered to more than 81% of pre-war levels in September, then fell sharply again in October as attacks on tankers rose. The US Energy Information Administration expects Middle East oil flows to stay constrained through the fourth quarter of 2026, with convoys, bypass routes and ship-to-ship transfers slowly lifting exports.
The World Bank reports that Brent rose about 65% in March 2026 alone — its largest monthly increase on record. For the region, the picture is mixed: higher prices for oil that does get out, but lower volumes, disrupted LNG, and much higher costs to move anything by sea.
Five ways the crisis reaches a GCC company
- Shipping and lead times. Fewer vessels, rerouted cargo and congested alternative ports mean longer lead times. Inventory that used to arrive in weeks can take much longer, and the stock you hold costs more to carry.
- Insurance and war-risk costs. Insurers have sharply raised war-risk premiums for Gulf shipping. These costs flow into freight rates and, eventually, into your landed cost per unit.
- Imported inputs. The Gulf imports much of its food, packaging and equipment. When shipping is constrained, input prices rise and supplier terms tighten — often with little notice.
- Customer demand. Government spending, project timelines and consumer confidence all react to oil revenue and security news. Some sectors grow; others see delayed orders and slower collections.
- Cash flow and financing. Higher inventory values, shorter supplier credit and slower receivables squeeze working capital, even in companies that look profitable on paper.
Why profit can look fine while cash runs short
In a supply shock, the income statement and the bank balance tell different stories. Sales may hold up, or even rise as prices increase. But if you are paying suppliers earlier, holding more stock as a buffer, and waiting longer for customers to pay, cash leaves the business faster than profit arrives. Many GCC SMEs discover this only when a payment run fails.
What it means for each role
- Business owners: Know which products, customers and contracts are still profitable at today's costs — not last year's.
- Accountants: Landed costs, freight surcharges and insurance must be captured at the item level. Averages hide the lines that are now losing money.
- CFOs and finance managers: Model cash flow under more than one scenario, review price-adjustment and force majeure clauses in key contracts, and check that VAT and customs treatment of new surcharges is correct.
Turning uncertainty into a plan
Nobody can forecast how long the disruption will last. What you can control is how quickly you see its effect in your own numbers. Companies with clean monthly accounts, item-level costing and a clear risk register can reprice faster, negotiate with suppliers using facts, and approach banks before — not after — a cash squeeze.
How Benchmark helps GCC businesses
Benchmark Tax & Accounting Advisory works with companies across Jordan, Iraq and the Gulf. We can review your ERP system so landed costs and margins update in real time, run your monthly accounting and reporting, build a governance and risk framework for supply-chain shocks, and make sure new surcharges are treated correctly for VAT and tax.
Want to see how the Hormuz crisis is affecting your margins and cash? Talk to us: +962 79 234 4234 or +962 77 582 1545, or visit www.benchmark-ta.com.
Sources: Al Jazeera — Hormuz attacks and oil flows (14 Oct 2026) · EIA — Short-Term Energy Outlook (Oct 2026) · World Bank — Hormuz disruption sends oil prices surging