The escalating conflict between Iran and Israel has once again raised concerns about the stability of one of the world’s most critical energy trade routes. Amid statements from Tehran about a possible closure of the Strait of Hormuz due to national security threats, global market anxiety is on the rise.

The Strait of Hormuz may become a pressure point for global markets

The Strait of Hormuz connects the Persian Gulf with the Gulf of Oman and serves as a vital corridor for energy exports. Vast quantities of raw materials pass through the strait daily, and any disruption to navigation could have serious economic consequences.

• About 30% of the world’s liquefied natural gas supply moves through the strait
• Nearly 20% of global oil and petroleum exports are transported along this route
• Iraq, Kuwait, Qatar, the UAE and Saudi Arabia are among the most vulnerable, as their exports largely depend on the strait

Many of these countries may face shipment delays, increased logistical costs and the urgent need to find alternative export routes.

Will the threat be carried out

Although Tehran officials have expressed readiness for drastic measures, including a closure of the strait, analysts believe such a scenario is unlikely. Iran itself relies heavily on the Strait of Hormuz to export oil, particularly to China, its largest trading partner.

• Similar threats were made in 2011 and 2018, but none resulted in actual disruption of shipping
• In April 2024, Iran’s navy detained a vessel linked to Israeli business interests
• Other such incidents have occurred in previous years, but were limited to isolated events

Still, even verbal threats and the detention of vessels have already increased perceived risks, driving up insurance premiums and freight costs for maritime transport.

Conflict impact expected on inflation and logistics

Even without a full blockade, a reconfiguration of trade routes and rising costs could negatively affect the global economy. The expected consequences include:

• Higher freight and insurance costs for tankers
• Increased logistics expenses for oil and LNG suppliers
• Intensified inflationary pressure, especially in energy-dependent economies

According to analysts at major investment banks, a sustained oil price surge is unlikely. However, short-term price spikes are possible. JP Morgan, for example, does not rule out Brent crude rising to $120–130 per barrel if threats to maritime safety increase.

The global economy remains exposed to Middle East geopolitical instability. Even without a direct closure of the Strait of Hormuz, Iran’s threats are already fueling market volatility and may complicate the recovery of global supply chains and inflation control.