Hormuz crisis hits economy across world: Report
Washington, April 5 (IANS/WISHAVWARTA) The closure of the Strait of Hormuz has triggered a widening global economic shock as energy markets reel from supply disruptions, according to a report.
The Iran war’s impact on global energy flows is intensifying, with the effective shutdown of the Strait of Hormuz disrupting oil, gas and critical supply chains across continents, according to The Washington Post .
The strategic waterway, through which about 20 per cent of the world’s oil passes, has become the focal point of the crisis, with Iran restricting maritime traffic in response to US-Israeli strikes.
The disruption is already rippling through global markets.
Energy prices are rising, supply chains are tightening and governments are preparing for prolonged shortages, with analysts warning that the economic impact could worsen significantly if the conflict continues, The Washington Post reported.
India, heavily dependent on energy imports, has moved quickly to secure supplies.
New Delhi has purchased oil from Iran for the first time in years, marking a significant shift after avoiding Iranian crude due to US sanctions, according to CNN.
India has also imported 44,000 metric tons of liquefied petroleum gas (LPG) from Iran, with shipments arriving at the port of Mangalore, the report said.
Oil prices could surge to $170 per barrel if the disruption lasts three months, while a prolonged six-month conflict could push the global economy into recession, according to estimates cited by The Washington Post.
Supply shocks are not limited to energy.
The blockage is also affecting fertiliser shipments, petrochemicals and industrial inputs, with shortages already hitting Asia and expected to spread to Europe and the United States in the coming weeks.
Petrochemical plants in countries such as India and China are facing shortages of raw materials used in manufacturing a wide range of products, including plastics, textiles and consumer goods, The Washington Post reported.
Agriculture is also at risk.
Fertiliser prices have surged sharply, with some inputs rising by around 50 per cent since the conflict began, raising concerns about future crop cycles and food inflation.
Shipping disruptions are compounding the crisis.
Thousands of vessels and containers remain stranded in the Gulf, affecting global trade flows and creating shortages of refrigerated containers needed for agricultural exports, according to industry analysts cited by The Washington Post.
As a result, several countries have introduced fuel rationing and conservation measures, while others are exploring alternative supply routes and emergency reserves to mitigate the impact.
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