A senior commander of the Islamic Revolutionary Guard Corps said Iran was prepared to “burn every ship” trying to cross the Strait of Hormuz, while warning that oil prices could reach $200 a barrel.
Iran threatens to completely block the Strait of Hormuz/PHOTO:AFP
Brigadier General Ebrahim Jabbari, an advisor to the Revolutionary Guards, made the statements on state television, claiming that the strategic sea route is, in fact, closed.
“The Strait of Hormuz is closed. Anyone who tries to cross, our dedicated IRGC navy and army heroes will burn those ships. Do not come to this region,” he said. In a separate message published on the organization's Telegram channel, Jabbari added that Iran could also attack oil pipelines and that “not a drop of oil will leave the region,” estimating that the price of a barrel could reach $200 “in the coming days.”
Maritime traffic through the Strait of Hormuz has already reduced dramatically. Hundreds of oil tankers and ships carrying liquefied natural gas are standing by as major shipping companies reroute their routes. The central question is whether Tehran will go all the way and completely close this strategic artery – or whether the threat will remain a tool of political pressure.
Considered the world's most critical “energy choke point,” the Strait of Hormuz is approximately 33 kilometers wide at its narrowest point, with waterways measuring just three kilometers each way. Any disruption to flow through this corridor would have immediate effects on global markets and supply chains.
Traffic down, prices up
Data cited by S&P Global Commodity Insights shows that sea traffic has dropped by 40–50% in just a few hours. Ships hurriedly left the area, while others avoided entering. Hundreds of oil tankers and LNG carriers are now anchored near the strait.
Shipping giants such as Maersk and MSC have diverted routes from the Gulf. China's COSCO ordered its ships to seek “safe waters”, suspending operations in the area.
Energy markets reacted quickly. Brent crude oil climbed more than 8% to near $79 a barrel after a temporary peak of 13%. West Texas Intermediate rose nearly 8% to over $72 a barrel.
Analysts warn that, in case of interruption of deliveries through Hormuz, gas prices in Europe could even triple. A blockade of several weeks could return quotes to levels seen after Russia's invasion of Ukraine in 2022.
Europe depends on liquefied natural gas for about a quarter of its consumption, and inventory levels remain below normal after a cold winter. Most of the volumes crossing the strait originate from Qatar, with smaller amounts from the United Arab Emirates. Although many shipments are destined for Asia – especially China and India – any disruption would intensify competition for alternative deliveries to Europe.
A vital hub for global energy
About a fifth of the world's oil consumption transits through the Strait of Hormuz – about 20 million barrels per day. The main destinations are China, India, Japan and South Korea.
India, which imports about half of its oil through this corridor, has activated emergency plans to protect its supply. China, the world's second largest economy, could be among the most affected. Beijing buys nearly 90 percent of Iran's oil exports, despite international sanctions.
But the importance of the strait goes beyond the oil market. About 20% of the global trade in liquefied natural gas passes through this sea route. According to analysis published by The Conversation, a third of the world's fertilizer trade also passes through the area. With the energy and agricultural chains already destabilized by the war in Ukraine, a further rise in prices could have far-reaching consequences.
It remains uncertain whether Iran is ready to close the strait completely. Analysts warn that such a move could hurt Iran's own economy and strain relations with China. However, under military pressure, Tehran may see the blockade as a means of exerting major influence on the global economy.
Closure could take many forms. The most direct would be the mining of sea routes. But even a credible threat could be enough to deter traffic if the risks become too great for commercial operators.
According to Wired, a formal shutdown would almost immediately block most Gulf oil exports. Even if Saudi Arabia and the United Arab Emirates were to use alternative pipelines at full capacity, about two-thirds of the region's exports would remain affected.
A weapon with global effect
For Tehran, control over the Strait of Hormuz is a major strategic tool. A blockade could trigger a steep rise in oil prices, with rapid inflationary effects in the United States and other major economies.
The economic costs would inevitably translate into political costs, amplifying the pressure on governments involved in the conflict and beyond. At a time when markets are already sensitive to geopolitical shocks, the future of this maritime corridor remains one of the most important unknowns of the global economy.
