WTI Holds Above $106 as South Korea Reveals 30M Barrel Crude Shortfall

The Import Gap

South Korea put the first hard number on the Hormuz supply gap this week. The country secured approximately 50 million barrels of replacement crude for April from Saudi Arabia, Oman, Kazakhstan, and the United States — against typical monthly imports of roughly 80 million barrels. That is a 30 million barrel shortfall, or 37%.

The consequences are already cascading through Korea's industrial base. Yeochun NCC, the country's largest ethylene producer, has declared a supply disruption. Lotte Chemical, LG Chem, and Hanwha Solutions have issued potential force majeure notices as naphtha feedstock dries up. Korea sources roughly 70% of its crude through the Strait of Hormuz, and with tanker schedules from the Gulf effectively empty since late March, refiners are working with what they can get.

The last tanker to successfully transit the Strait — the Eagle Valour — docked at Daesan Port carrying 2 million barrels, equivalent to a single day of domestic consumption. Everything since has been rerouted supply at higher cost and longer lead times.

Diplomatic Dead End

The diplomatic channel to end this is in worse shape than the supply chain. On April 1, an airstrike hit the home of Kamal Kharazi, former foreign minister and senior adviser to Iran's supreme leader. Kharazi was seriously injured and his wife was killed. Iranian officials described the strike as a deliberate attempt to derail diplomacy — Kharazi had been overseeing backchannel engagement with Pakistan for a potential meeting between Iranian officials and US Vice President JD Vance.

Hours later, Trump's primetime address to the nation offered no exit ramp. The president promised to hit Iran "extremely hard" over the next two to three weeks and told allied nations facing fuel crises to "get your own oil", singling out the UK specifically.

Iran's foreign minister Abbas Araghchi confirmed that no negotiations exist with Washington, described US demands as "maximalist and irrational," and said Tehran has "zero" trust in the US. The war is 34 days old with no diplomatic path visible.

The Numbers Get Worse From Here

The IEA warned that April supply losses from the Hormuz closure will double March's because pre-war cargo in transit has been fully absorbed. Separately, EIA data showed US domestic oil production fell 410,000 barrels per day in January — the largest monthly decline in two years — meaning the domestic production buffer is thinner than assumed.

South Korea's 37% import shortfall is likely a preview of what other major importers will report. Japan, India, and European economies face similar Hormuz dependence, and their April procurement numbers have not been published yet. European natural gas prices are already up 70% since the war began, and European diesel shortages could materialize within weeks.

Goldman Sachs has April Brent at $115. Given that importers are already failing to backfill lost volumes at $106, that target looks conservative if the Strait stays closed through mid-April.

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