Tehran: Ships trying to transit the Strait of Hormuz would be attacked, Iran has warned, effectively closing down the narrow, but extremely crucial waterway connecting the Persian Gulf to the Gulf of Oman.
Ebrahim Jabari, a senior adviser to the commander-in-chief of the Islamic Revolutionary Guard Corps (IRGC), has warned that ships in the Strait would be “set ablaze”.
Situated between Iran and Oman, the Strait of Hormuz is one of the most critical chokepoints in global trade.
Global energy markets have been rattled by this development, with oil prices jumping sharply amid fears of prolonged disruption. Though there is no formal international confirmation that the strait is completely sealed, tanker traffic has fallen and reports of electronic interference and attacks near the waterway have heightened alarm, as reported by TOI.
The strait is just 21 miles (33km) wide, with shipping lanes only two miles wide in each direction. Yet a fifth of global oil consumption passes through the strait. More than 20 million barrels of crude, condensate and fuels moved through it daily last year.
Nearly 30% of global seaborne oil flows transit this route and Qatar sends almost all of its liquefied natural gas (LNG) exports through the strait.
The narrow corridor is used by major producers — including Saudi Arabia, Iran, Iraq, Kuwait and the United Arab Emirates — to export crude. Much of it is destined for Asian markets.
Even a short disruption could lift crude prices sharply. A closure lasting weeks rather than days could push oil well above $100 a barrel and send European gas prices back towards the crisis levels seen in 2022, energy analysts warn.
Apart from a jump in crude prices, transportation costs for all cargo has gone up over the last few days with insurers hiking rates due to the ongoing conflict in the region.
For countries like India, which exports significant volumes of rice and imports large quantities of Gulf crude, the fallout could extend well beyond energy markets.
While a brief flare-up may be absorbed, a sustained blockade would have profound consequences for global inflation, shipping costs and economic stability.
