How exposed is the global economy to Persian Gulf energy supply?

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Current tensions in the Middle East have renewed concerns about global energy security and its impact on the global economy. OECD analysis shows that dependence on Persian Gulf energy extends far beyond direct oil imports, creating vulnerabilities that could weigh on inflation, growth and supply chains if the disruptions persist.

by Christine Arriola, Seung-Hee Koh, Catherine MacLeod, OECD Economics Department

Why do events in the Persian Gulf matter?

As tensions in the Middle East continue to raise concerns about energy markets, policymakers are again assessing the risks associated with dependence on Persian Gulf oil and gas. One indicator of exposure is provided by the importance of imports of energy from the Gulf economies. But this provides only a partial picture, given the broader exposures that arise via supply-chain linkages. To understand the scale of these exposures, the OECD Inter-Country Input-Output tables can be used to trace how imported Persian Gulf energy flows through production and supply chains across the global economy. The results highlight the significant direct and indirect exposures that all economies have to a disruption in energy supplies from the Gulf economies.

Who relies on Persian Gulf energy?

Direct dependence on Persian Gulf energy imports for production varies significantly across economies. Asian and European economies, including Thailand, Korea, India and Greece, tend to rely more heavily on imports of crude oil and refined petroleum from the region compared to countries in the Americas (Figure 1). By contrast, the United States and other commodity producers have lower direct exposure, benefiting from greater domestic energy production. Countries with greater direct dependence are particularly likely to feel the effects of supply disruptions and price increases quickly, unless these are cushioned by the use of available energy inventories or other government policy actions.

The overlooked role of supply chains

Direct imports tell only part of the story. To capture total exposure to Persian Gulf energy, it is also necessary to account for how it is used throughout domestic and international supply chains. As industries purchase inputs from suppliers that depend on Gulf energy, exposure can compound across production stages.

As shown in the latest  OECD Economic Outlook, overall exposure to Persian Gulf energy increases significantly across many economies once these indirect supply chain linkages are considered (Figure 2). In many cases, indirect exposure exceeds direct dependence. This is especially evident in Asia, where intra-regional trade and production networks increase indirect exposure in countries such as Thailand, Korea, India, Japan and Chinese Taipei. But there are also important indirect effects across a wide range of non-Asian economies.

This means that disruptions in the Persian Gulf region can spread far beyond countries that import large quantities of oil or gas directly from the Gulf countries. A prolonged disruption to energy supplies from the Gulf could therefore affect the price and availability of a wide range of manufactured goods, transport services and industrial inputs, as well as energy costs.

Which sectors are most exposed to Persian Gulf energy?

The effects of disruptions to Persian Gulf energy supplies are likely to vary across sectors because industries differ in their reliance on energy inputs and in the structure of their production networks. Not surprisingly, the coke and refined petroleum sector has the highest total exposure to Persian Gulf energy in both the OECD and in smaller dynamic Asian economies (DAE) (Figure 3, Panel A). This primarily reflects the importance of crude oil imports from the Gulf for the production of refined products, with indirect exposure through inputs such as electricity, chemicals, transport and machinery that themselves depend on Gulf energy. Sectors such as transport services, chemicals (including petrochemicals) and basic metals also emerge as highly exposed once supply chain linkages are taken into account. Even industries with relatively limited direct use of Persian Gulf energy may be affected through their production networks; for example, agriculture may be affected indirectly through its use of fertiliser, machinery, and transportation services. The overall exposure to Persian Gulf energy is generally higher across most sectors in the dynamic Asian economies, reflecting their greater dependence on energy imports from the region.

The exposure to energy inputs may be even greater than shown if there are broader disruptions to the global supply of oil and gas or diversions of planned energy suppliers from other producers.  Many sectors in both OECD and dynamic Asian economies have a high aggregate exposure to imported energy from all sources (Figure 3, Panel B). This suggests that although dependence on Persian Gulf energy varies across regions, a broader disruption to global energy markets could affect a much wider range of sectors through higher energy costs and supply chain linkages.

How can economies reduce their exposure to energy disruptions?

Energy disruptions can be cushioned in the short term through international coordination of strategic energy stocks. However, the longer supply interruptions persist, the greater the risk that shortages affect production and economic activity more broadly. Over the longer term, reducing vulnerability will require diversifying energy supplies – not only from across source regions, but also by avoiding undue reliance on a particular set of energy sources, such as fossil-fuel imports. Improving energy efficiency is also critical, particularly in regions where energy use remains high compared to international benchmarks.

As the current crisis demonstrates, strengthening resilience to future shocks requires reducing dependence on critical transport corridors and better understanding the supply chain linkages through which disruptions can spread across the global economy.

References:

OECD (2026), OECD Economic Outlook, Volume 2026 Issue 1: Under Pressure, OECD Publishing, Paris, https://doi.org/10.1787/2d1956f0-en.