Hormuz supply disruption reshapes economics for Dune Oil’s Turkish oil block

The largest oil supply disruption in recorded history is playing out against an unusual backdrop for a small Vancouver-based energy company: a flagship exploration block in southeastern Türkiye whose independent resource valuation was built on oil prices roughly 50% below where the market is trading today. 

Dune Oil Corp (CSE:DUNE, OTCQB:TRLEF, FRA:Z620) holds a 29% working interest in Block M47, located in the Cudi-Gabar province of southeastern Türkiye. The block targets 32.4° API light oil, a premium-grade crude benchmarked to Brent. The company is currently fulfilling earn-in obligations, with US$15 million committed across 2026 and 2027 toward the M47 work program, including exploration drilling. 

The macroeconomic context has shifted substantially since the block’s independent resource evaluation was completed. That evaluation used a near-term Brent price assumption of US$63.68 per barrel for 2026. Brent has since traded above US$100 per barrel following the partial closure of the Strait of Hormuz, which Dune estimates has removed approximately 9.1 million barrels per day from global supply — a disruption the company says exceeds prior historical shocks, including the Gulf War. 

The unrisked NPV-10 from the independent evaluation stands at US$733.5 million, net to Dune’s working interest, at the base-case price assumption. The degree to which sustained higher prices would improve that figure depends on reservoir outcomes that remain unresolved ahead of drilling. 

Scott Lower, Dune’s president, has pushed back on the view that the current supply crunch is temporary. “The consensus is still treating this as a temporary spike. We don’t see it that way. A decade of underinvestment doesn’t unwind in a quarter,” he said. 

The supply-side argument has some grounding in broader market data. Global upstream investment contracted sharply through the 2015-2020 period and, while it has partially recovered, has not returned to pre-downturn levels in most producing regions.  

The disruption carries specific consequences for Türkiye, where the macroeconomic pressure on energy imports provides a domestic context for M47’s potential development. 

Türkiye imports between 1 and 1.2 million barrels of oil per day while producing approximately 130,000 to 140,000 barrels domestically. The country meets roughly two-thirds of its total energy needs through imported fossil fuels and ranks second among G20 nations in energy imports as a share of GDP, behind South Korea. 

A June 2026 analysis by energy think tank Ember estimated that the Hormuz crisis would add US$14 billion to Türkiye’s energy import bill between March and the end of 2026, a roughly 30% increase over the baseline annual burden. Türkiye paid US$47 billion for net energy imports in 2025, of which oil accounted for approximately 47%. 

Ember’s analysis attributed US$7.7 billion of the projected increase to oil costs, with around US$5.2 billion of that driven by road transport. Between late February and May 2026, Brent crude prices rose approximately 50%, European gas prices climbed 45%, and net energy import costs for March through May were already running about US$3 billion above the prior-year period. 

The 2022 Russia-Ukraine war offers a precedent for the scale of exposure. That shock drove Türkiye’s net energy imports above US$80 billion, representing 8.6% of GDP, coinciding with the country’s third-largest trade deficit on record. 

Lower noted the policy dimension of Türkiye’s import dependency. “When Brent trades above $100, that dependency is felt directly in energy costs, supply security, and policy. Domestic onshore production of the kind we are developing at M47 becomes exactly what Türkiye needs.” 

The Cudi-Gabar region where M47 is located has seen regional oil production grow from negligible levels to more than 80,000 barrels per day, according to Dune, though M47 itself remains in the exploration stage and has not yet established commercial production. 

Whether the current price environment holds through the company’s drilling timeline remains to be seen, but Dune’s investment case rests on a combination of sustained elevated prices, successful exploration outcomes, and continued Turkish government support for domestic energy development. If those hold, the current backdrop could significantly improve the economics already outlined in the independent evaluation.