Beijing, China – A Chinese state-run newspaper warned that any potential closure of the Strait of Hormuz would trigger a sharp spike in oil prices, with far-reaching consequences for financial markets and global supply chains. This comes amid escalating geopolitical tensions in the region.
The newspaper noted that the strait is a vital artery for the transport of approximately one-fifth of the world’s oil supply. This makes any disruption to shipping directly a factor in driving up global energy costs. Furthermore, it would push inflation rates higher, particularly in oil-importing economies.
Analysts believe that global markets are highly sensitive to any threat to this strategic waterway, as major Asian countries rely on it to secure their energy needs. Meanwhile, global stock exchanges are closely monitoring developments in the region.
The newspaper also warned that closing the strait would not only affect oil prices but also shipping and insurance rates. This could lead to a reshuffling of the global economy at a time when it is striving to recover from successive waves of inflation.
The Chinese report reflects growing concern among major economic powers about any escalation that could threaten the stability of energy supplies. It also recalls scenarios from previous crises that saw record-high crude oil prices, followed by turmoil in global markets.
