In August 1973, while the late Egyptian President Anwar Sadat was visiting Saudi Arabia, he leaned towards his friend King Faisal bin Abdulaziz to request a secret meeting. His request was granted, and at the meeting, Sadat made a demand that no one had previously succeeded in: cutting off Arab oil supplies to the West.

This meeting was not as secret as Sadat thought, or perhaps he himself wanted news of it to reach the West for testing purposes (*). The US Secretary of State at the time, William Rogers, dismissed the matter, famously saying, "The Arabs can't drink their own oil; they're forced to sell it to us for money... Enough of this nonsense." What Rogers failed to consider, however, was that the threat was very real and, just two months later, had become a painful economic and military reality.

History repeats itself. All military, political, and social analyses prior to the outbreak of the Iran-Iraq War on February 28th predicted that "closing the Strait of Hormuz would be financially devastating for Tehran," and that it would be "suicide and economic self-destruction, especially if the closure lasted more than a month," as described by the British newspaper The Guardian. So what about a full 111 days?

What happened afterward is now history, but its impact will remain for years to come in the minds of the Gulf states, for whom the war shattered their illusions and dispelled their complacency regarding the sustainability of energy market calculations.

Perhaps the greatest service the war provided to the Gulf states—despite the economic and military pain it inflicted—is that it taught the region six lessons that could forever alter the calculations of the oil and gas sector:

1) Iran learned the rules of the game in Hormuz: Iran can close the Strait of Hormuz from the very first day of any war, without hesitation, and with complete ease, even if it harms its economy and endures unbearable hardship to achieve its military objectives on the ground. Yes, the world may take more measures to secure the strait in the future, or invest more in inexpensive minesweepers and drones that can target ships from the air at minimal cost. But all this doesn't change the fact that whoever closed the strait, through which a fifth of the world's energy passes, once can close it dozens of times, because they simply "know the rules of the game."

This war will also teach the Gulf states and Iraq the importance of storing oil in areas far from the Gulf in anticipation of a new round of conflict, whether in floating storage on older tankers or in Asian countries untouched by the flames of frequent military conflicts, such as India, Japan, and South Korea, where Saudi Arabia reinforced its storage facilities during the war. This allows for the rapid dispatch of shipments to contractors if energy supplies are once again blocked within the Gulf, thus ensuring the uninterrupted flow of oil revenues. This is something Aramco recognized, prompting it to announce, just hours after the signing of the temporary peace agreement, its intention to establish new storage facilities around the world.

On the other hand, the war revealed that Iran itself had been pursuing this course of action for years, storing massive quantities of oil floating outside the Strait of Hormuz, not only in anticipation of war but also to circumvent Western sanctions. This gave it greater room for maneuver than previously thought.

2) An oil market surplus is not necessarily a bad thing, especially during crises: As recently as January 26, 2026, a month and two days before the war, the International Energy Agency was warning that the oil market was "oversupplied," estimating a surplus of more than 4 million barrels per day in the first half of 2026, and an average of more than 3.7 million barrels per day for the entire year.

The US Energy Information Administration was not far off this estimate, predicting at the time that supply would exceed demand by more than 2.8 million barrels per day that year, with the surplus peaking at over 3.5 million barrels per day during the current quarter.

The only one that swam against the tide was OPEC, which saw a market much closer to balance in 2026, with supply exceeding demand by about 600,000 barrels per day on average this year.

Ironically, the very oversupply that was seen before the war as a burden on prices became a safety valve for the markets. Importing countries, especially China, had exploited the glut to build massive stockpiles before the outbreak of war. This later helped prevent prices from exploding to $200 a barrel, as some pessimistic scenarios had predicted, after OPEC production plummeted to its lowest level in four decades during the war.

3) Energy reserves can run out faster than we imagine: The 1973 war was the first to alert the world to the importance of oil reserves, leading to the establishment of the Strategic Petroleum Reserve (SPR) by the United States on December 22, 1975. Several countries followed suit, starting with China, which also stored more than 1.4 billion barrels of oil, and Japan, whose pre-war reserves reached 470 million barrels. Western and even Arab countries took similar steps, albeit on much smaller scales.

But even with all this, these barrels didn't last as long as we might imagine against the Gulf's blockade, which held a fifth of the world's energy supply for over 100 days. On March 11, the International Energy Agency (IEA), in coordination with its 32 member countries, was forced to undertake the largest joint release of oil stockpiles in history, amounting to 400 million barrels over three months. The United States bore the brunt of this release (172 million barrels), followed by Japan (80 million barrels) and Canada (23.6 million barrels), with Australia and European countries contributing the remainder.

Alongside the coordinated 400 million barrel plan, some major countries acted unilaterally, releasing additional quantities to protect their domestic markets. The United States released an additional 10 million barrels through a "unilateral emergency swap." Since China is not a full member of the IEA, it also acted unilaterally, supplying both state-owned and independent refineries and urging them to "operate at all costs" under these wartime conditions. Even developing and island nations like Fiji depleted a significant portion of their reserves to cope with the crisis.

This unprecedented historical depletion has caused global strategic reserves—especially American ones—to plummet to their lowest levels since 2003. Signs of weakness have emerged in governments, particularly in Asia, leading some to close their supply lines to their neighbors, as happened in the case of Japan. Even China itself was forced to draw on its commercial oil reserves to cope with the Gulf crisis.