Articles/Columns
Iran Threatens Again to Block Oil Passage through the Strait of Hormuz, Causing Oil Prices to Jump
According to reports by the New York Times and Reuters, Iran has threatened to block the Strait of Hormuz – the world’s most important oil transit point, where the U.S. Energy Information Administration points out that about 33 percent of all seaborne traded oil and 17 percent of oil trade worldwide, pass through the Strait. The threat was issued by the Vice President of Iran in response to coordinated efforts by the U.S. and the European Union to impose further sanctions on Iran’s oil exports. Oil earnings contribute a significant portion of Iran’s budget allocation, so the series of economic sanctions that the U.S. and Europeans have successfully imposed on Iran the last couple of years (to hamper Iran’s efforts for nuclear capabilities), coupled with new measures to block their oil exports, would definitely damage Iran’s economic stability. The latest threat, which coincided during Iranian naval exercises in nearby waters, caused oil prices to jump due to investors’ fears of supply disruptions. However, an OPEC delegate has stated that the oil price jump will probably be temporary since he does not expect Iran to actually fulfill the threat, which would also damage Iran economically and invite military intervention by Western forces, namely the U.S. In addition, any oil trade to European buyers can be rerouted toward Asia, while the other Gulf States can reroute some of their Asian oil trades and fill the trade gap to Europe. These balancing measures to ensure economic continuity are only temporary in face of political, economical, and military threats. The more economic pressure that is applied to the Iranian regime, the more likely they will consider a self-defeating act such as blocking the Strait of Hormuz and damaging not only their domestic economy but also the global economy. The stakes are too high for powerful global players to idly stand by and watch as the Iranian political ideologue attempts to sink the global economy. The same is true on the Iranian side, as Western forces threaten their independence and their hold of national power. Unfortunately there are real consequences to any actions taken, and it seems that both sides are holding high pocket pairs (in reference to Texas Hold ‘em Poker) and betting hard that the other side will cave in to their demands – it is possible that Iran will bet it all (i.e. actually block the Strait of Hormuz).
Expanded Map Pointing to the Strait of Hormuz
Source: Google Maps
（2011/12/28 掲載）