The Strait of Hormuz: A Potential Flashpoint in Global Energy Markets

The strategic Strait of Hormuz faces potential blockade threats from Iran following US bombings on its nuclear sites, posing significant risks to global energy supplies. Disruption in the strait, through which a large portion of oil and LNG is transported, could lead to a dramatic rise in energy prices and market volatility.

The strategic Strait of Hormuz is at risk of being closed by Iran as a response to recent US bombings on major Iranian nuclear sites. This narrow passage plays a crucial role in global energy transportation, connecting the Persian Gulf to the Arabian Sea.

Almost 30% of the world's oil and a third of its LNG pass through the Strait of Hormuz daily. A blockade here would severely impact global supplies, especially India's energy security, according to strategic affairs experts. The closure could lead to soaring energy prices and significant disruptions in oil trade.

Captain D K Sharma, a former Indian Navy spokesperson, warned that disruptions would lead to increased insurance premiums and force costlier rerouting of shipments. With oil prices potentially reaching USD 100 per barrel, market volatility is expected, affecting regional currencies and investor confidence.

(With inputs from agencies.)