Iran10 July, 20263 min read
Israel And Iran Exchange Missiles As Fears Grow Iran Could Block Strait Of Hormuz
This article is an automated aggregation of coverage from news outlets. Our editorials offer in-depth analysis curated by the NewsCord team.
Iran could close or disrupt the Strait of Hormuz, threatening global oil transit. Disruptions threaten fuel and essential fertilizers, risking higher global food prices.
Hormuz blockade fears
The exchange of missiles between Israel and Iran raised fears that Iran might attempt to close the maritime route through the Strait of Hormuz, the BBC said, describing it as the world’s most vital chokepoint for oil transit.
The BBC reported that about one-fifth of the planet’s crude oil passes through the channel, which is only about 40 km wide at its narrowest point, and said the U.S. Energy Information Administration (EIA) estimates that during the first half of 2023, about 20 million barrels of oil passed through the strait per day.
The BBC also said Sir Alex Younger, former head of Britain’s MI6 intelligence agency, told the BBC that his most pessimistic scenario would involve blocking the strait, because “the closure of the strait would obviously be an incredible economic problem, given the effect it would have on oil prices.”
The BBC added that closing the Strait of Hormuz is viewed by Iran as a form of deterrence power, comparable to possessing a nuclear weapon, and said experts often predict Iran could be able to temporarily block the strait while the United States and its allies could quickly restore the flow of maritime traffic using military means.
Food crisis and shipping
UN News warned that disruptions in the Strait of Hormuz raise fears of a global food crisis, saying “Disruptions in the Strait of Hormuz threaten to disrupt supplies of fuel and essential fertilizers, with higher food prices likely to follow.” UN News said the fragile truce between the United States and Iran in recent days did little to restore confidence in the corridor, where persistent tensions—including “the recent announcement of an American blockade targeting ships using Iranian ports”—kept ships idle and supply chains under pressure.
UN News reported that since the start of hostilities on February 28, disruptions were already hampering flows of oil, gas and fertilizers needed for newly planted crops, and quoted Máximo Torero, FAO’s Chief Economist, saying “Between 30% and 35% of crude oil, 20% of natural gas, and 20% to 30% of other inputs are no longer flowing.” UN News also warned that even if de-escalation occurs, it will take several days, or even weeks, to return to normal, and said David Laborde, director of the FAO’s Economy of Agro-Food Systems Division, cautioned that the delay could be critical.
Africa’s clean cooking hit
Climate Home News reported that disruptions to global fuel markets caused by the war in Iran have hit Africa’s efforts to expand clean cooking with gas, prompting the International Energy Agency (IEA) to launch a programme aimed at strengthening security of supply. Speaking at a high-level online event on clean cooking in Africa, IEA executive director Fatih Birol said LPG supply had been “disproportionately affected” by the Strait of Hormuz crisis, and added, “Our numbers show that 3.4 billion people around the world, most of them in Africa, have been negatively affected as a result of the LPG crisis.”
“Our numbers show that 3.4 billion people around the world, most of them in Africa, have been negatively affected as a result of the LPG crisis.”
Climate Home News said around 30% of global seaborne trade in LPG passes through the key shipping route off the coast of Iran, and that supply disruptions and price shocks led to fuel rationing and sharp price hikes in Asia and Africa this year, putting LPG beyond the reach of many households. The same article said the IEA’s new clean cooking security programme is aimed at expanding LPG storage, strengthening supply chains, and improving cooperation between producing and consuming countries, and noted that the IEA announced $900 million in new commitments for clean cooking in Africa alongside the $2.2 billion pledged at the inaugural Africa Clean Cooking Summit in Paris in 2024.