Mumbai, July 29, 2026 (Yes Punjab News)
Prolonged instability in West Asia and the growing risk of disruptions at two key maritime chokepoints — the Strait of Hormuz and the Red Sea — could put pressure on the profitability of Indian exporters and importers, especially small and medium-sized businesses, according to a report.
The report by CareEdge Ratings said disruptions could lead to higher marine insurance premiums, increased freight costs and longer transit times, affecting companies with limited ability to absorb rising expenses.
The Strait of Hormuz remains crucial for India’s energy security, with around 40 per cent of the country’s crude oil imports and a significant portion of LNG and LPG supplies passing through the route.
According to the report, Brent crude prices touched $115 per barrel in May 2026 following disruptions around Hormuz. A simultaneous disruption in both Hormuz and the Red Sea could push crude prices further to $130-$135 per barrel, creating inflationary pressures and affecting global energy supplies.
The report noted that while India has managed energy risks through diversified sourcing, including increased dependence on Russian crude, the economic impact of the West Asia conflict is intensifying.
Concerns have also emerged over possible disruptions at the Bab-el-Mandeb Strait, a critical maritime passage connecting the Indian Ocean with the Red Sea and the Suez Canal. Any disruption there, combined with risks around Hormuz, could severely affect global logistics and supply chains.
CareEdge Ratings said rerouting container traffic through the Cape of Good Hope could increase delivery timelines by two to three weeks and raise transportation expenses.
“A simultaneous closure of the Strait of Hormuz and the Red Sea, even for a few weeks, could trigger a sharp surge in global energy prices, with Brent crude potentially rising to $130-$135 per barrel,” said Priti Agarwal, Senior Director at CareEdge Ratings.
The report warned that smaller companies could face margin pressure, higher working capital requirements and liquidity challenges due to rising input costs and supply chain disruptions, while larger firms with stronger pricing power may be better positioned to manage the impact.
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