Why the Strait of Hormuz Is So Important to Australia and New Zealand

A bit of simple arithmetic is needed to explain why the closing of the Strait of Hormuz could destroy the economies of Australia and New Zealand.

Both countries rely on imported refined product from Asia. New Zealand is wholly dependent while Australia is about 90% dependent. China has ceased exporting product, so cross them off the list. That leaves, for the most part; South Korea, Singapore and Malaysia.

South Korea processes up to 3.4m bpd (million barrels per day), 2.5m of which is consumed domestically. 70% of their supply comes from the Middle East.

Singapore processes about 1.5m bpd, and they import 70% of their oil from the Middle East.

Malaysia processes about 900,000 bpb, and they import about 40% of that oil from the Middle East as they have their own oil wells. Domestically, they consume about 77% of the total and export the rest.

I trust you may begin to see the problem. With a huge amount of Middle Eastern oil coming through the Strait shut off, these economies will need to prioritise their own market first, and even then they'll come up short.

South Korea has begun buying oil from Canada, about 800,000 barrels per day. That's well short of the 2.4m bpd needed. They can only just supply themselves, leaving nothing to export. 

Singapore looks set to lose 1.0m bpd, and that equates to the daily consumption of Australia. Forget NZ, they'll just be left to fail.

Malaysia, just to supply its own needs, will have to import from other sources, just as South Korea is doing.

All of this adds up to a very serious predicament Downunder. I see the Philippines has declared a state of emergency, and that is a wise thing to do. Australia and New Zealand need to follow suit as this war in the Middle East could drag on for a long time, that much is obvious. 

Weather Bomb Bust in New Zealand

New Zealand's National Party are now so desperate to appear relevant, they've manufactured an imminent tropical cyclone to scare everyone with. They had people sandbagging for days, and issued mandatory evacuation orders. Well, what happened? A bit of wind and rain is what happened. Study the weather map from Accuweather to see what the weather over the North Island looked like as Cyclone Vaianu was about to hit:

Of course the government will be saying, better to be prepared, but accuracy with forecasting is really important. Over-hyping a bit of rain means that eventually, people stop listening, and that may lead to people ignoring valid warnings.

This was, yet again, a pathetic attempt by National to appear relevant. They've kicked farmers and contractors in the teeth by doing nothing to mitigate high diesel prices caused by the fuel crisis. Now they're playing disaster politics. Can we please just get rid of these numpties.

Meanwhile, I'm sure the tame NZ media will have pictures of a couple of downed trees to scare everyone with. 

Weather North Island, NZ April 12th

Iran's Victory Changes Everything

The Strait of Hormuz will remain closed until all of Iran's demands are met. Iran is calling the shots, and no-one can challenge them.

Useful Map from JP Morgan

Study the map to find out where and when fuel gets to critical levels in each region. Each area circled shows where fuel supply starts to become critical. The east coast of Africa is first, they're already feeling it. Then the Far East from the 1st of April. Europe follows on April 10th, and the US April 15th. Lastly, Australia and NZ feel the pinch from April 20th.

Why haven't governments hit the panic button yet? The reason: they're living in a false spring, either hoping supplies will resume, or refusing to see the bigger picture. What consumers are putting in their vehicles now are refined fuels from crude shipped back from before the war started. As those stocks from earlier gradually run out, the pinch will be felt, and fast. 

JP Morgan Map of Critical Oil Supplies

Food Rationing Coming Soon

Diesel could soon run out, and if that happens, food shortages will become very real. Australia is openly talking about it, and New Zealand must wake up.

The governments of Australia and New Zealand are inept, we need to get started with securing diesel supplies NOW.

Australia's VC Hero Arrested and Charged

Ben Roberts-Smith is a living legend, the winner of the military's highest honour, the Victoria Cross. Now, he sits in a jail cell. Australia is plumbing the depths. This is a complete disgrace and out of control stupidity:

https://www.theguardian.com/australia-news/2026/apr/08/ben-roberts-smith-brs-gina-rinehart-alleged-war-crimes-arrest-ntwnfb

“As the recently passed, Brigadier George Mansford succinctly stated, ‘The oath to serve your country did not include a contract for the normal luxuries and comforts enjoyed within our society. On the contrary, it implied hardship, loyalty and devotion to duty’.

“Have we lost sight of the fact that in our inadequately defended country, facing uncertain times, the morale of our defence force has already been brought to its lowest ebb since inception, our defence personnel numbers are inadequate, and recruitment is suffering.

“Like many Australians, I hope that compassion and the Aussie spirit is extended to Ben and his family and his duty to our country in the hardship of war is never forgotten.”

Iran Wins, US Defeated

If reports are to believed, big IF, then Iran is now one of the big four, and the big three of US, China and Russia have a new member. Iran has defeated the United States.

For a ceasefire to be called, Iran had ten key demands, and Donald Trump announced he's accepted all of them. This leaves Iran in complete control of the Strait of Hormuz, the Persian Gulf is now its lake.

The US defeat in Afghanistan was the biggest defeat of a western country in history, ancient or modern. Now, this surpasses that. But then, the ceasefire may end within 24 hours, who knows? One thing is for certain, countries are going to find it hard still as the oil isn't flowing yet, and it may take a year or two for flows to resume even if the will exists to make it so.

Update: thinking about this some more, this appears to be Iran's Battle of Britain moment. I'll explain, the BoB was a defensive action, with Britain's goal of avoiding outright defeat. The way the Germans saw it, they were simply trying to knock Britain out, then when they'd done that they turned around to deal with the bigger threat, Russia (then known as the USSR). Thus, Britain claims victory as they were still standing when the attacker quit. Germany, however, say they did not lose, they just changed priorities.

The reality was that Germany was losing aircraft at a rate where they could not replace them. Most losses were on the ground in takeoff and landing, in fact, not fighting in the air. If Germany had continued, they'd have simply run out of planes, while Britain's industry could replace theirs. The Germans badly underestimated the industrial output of the British Midlands.

This appears to be a similar situation in the Gulf. The US lost 11 or so aircraft just rescuing one downed airman, and their bases have all been destroyed in the region. Their carrier strike group has had to retreat well into the Arabian Sea, well away from cruise missiles. Scuttlebutt says that Trump did launch an attack on Iran, in line with his ultimatum, but that every Tomahawk cruise missile was taken out by Iran. He buckled after that, and I'm speculating he was told that the US was fast depleting its ordnance and that it couldn't be easily replaced. 

Israel has announced they do not consider their offensive in Lebanon as being covered by the ceasefire, and the Gulf states will be unhappy ending up effectively satraps of the new Iranian empire. Therefore, this ceasefire is unlikely to last any more than a few hours or days - we'll see.

And think, we have a Soccer World Cup coming up, that will be interesting. 

Theo Von Nails It

It was never Republicans vs Democrats, it was the war machine vs everyone:

What's Going On in Australia?

 Is a full fuel lockdown coming?

National Want to Lose the Election in 2026

The cockwomble National government of New Zealand, led by Christopher Luxon, a man who looks like a timeshare salesman from the 1990s, seems to have given up. No doubt they're all brushing up their CVs as they've now dropped to 26% in the latest poll. For any government, that's catastrophic. 

Luxon has dropped to 17% as the preferred prime minister. Coalition partner Winston Peters, may soon pass him. Luxon is a man who can never find his spine.

The fuel crisis has exposed National's Minister of Finance, Nicola Willis, who can only say she understands the issues, will talk to all stakeholders, have reports done, and reports on those reports, but who never actually does anything. She's a classic duck-shoving middle manager. 

https://www.roymorgan.com/findings/10181-nz-national-voting-intention-march-2026

Reaction to Trump's Speech

 A quality rant this:

Update: Strait of Hormuz

The amount of oil and gas being carried through the Strait of Hormuz has plummeted, from an average of over a hundred tankers daily during February, down to an average of six tankers daily in March. However, there is a trend of some tankers running the strait by sticking close to the Omani shore, while others are paying the toll to Iran and going through the toll gate they've set up between Larak Island and Qeshm Island (not a literal toll gate, but a passage through which ships must travel).

Russian oil is back in the mix, too, and Southeast Asian refineries appear to be using this oil as additional feedstock.

What may happen is that the world gets to a point where the price of fuel is simply high all the time, with a new normal being that Iran has control of a huge chunk of global supply. 

Countries like Australia and New Zealand will have to suck this up, for now, but then move swiftly to self-sufficiency, as they both have the resources. They both lack the ability to process these resources, and so they must move to fully industrialise.

Australia's Military Compromised

I wondered how long it would take for the penny to drop. Without fuel, Australia won't be able to defend itself.

Reaction to Trump's Speech

Interesting initial reaction, I'll check over the next few hours whether the markets react positively or negatively.

Trump Addresses the Nation

I watched it live, but I have to confess I'm none the wiser. President Trump said what he'd already posted on social media, and left a lot up in the air. What, exactly, was that all about? 

Australia Allows Heavier Loads

It makes sense to allow trucks to carry more each load, it will save fuel, although roads will get knocked about more.

Australia Fuel Crisis, Food Shortages Loom?

With 25 million mouths to feed, how will Australia feed its people affordably if the diesel and fertiliser costs soar?

Australia and New Zealand Get Roasted

Deserved shellacking this:

For New Zealand, a whole series of decisions amounted to sabotage.

Fuel Crisis Needs Urgent Action

Both Australia's and New Zealand's governments refuse to take action. It is as if they want the countries to fail.

Can you ride a horse? I can.

Australia to Underwrite Extra Fuel Imports

Getting the idea New Zealand? Do something. 

No idea if this measure will help, but at least it's an attempt.