How Iran’s Hormuz blockade chokes global trade beyond oil and gas
When an Indian tanker carrying liquefied petroleum gas (LPG) passed through the Strait of Hormuz recently, its progress was followed by excited live TV news coverage.
“Its position was received eight minutes ago. It’s currently at 12.5 knots and is moving at 154 degrees. It’s reported ETA in India is at 9.30 p.m. tomorrow,” reported one journalist, providing running commentary while following a tracker app.
Later, videos showed the ship with a military escort from the Indian Navy in the Gulf of Oman.
The attention was not unwarranted. The war in Iran, and Tehran’s decision to largely close the Strait of Hormuz, have not only stopped supplies of crude oil and liquefied natural gas (LNG). Shipments of a whole range of other vital commodities have also almost completely ground to a halt.
Even if the war ends, markets may not return to normal quickly. Iranian attacks have caused untold damage to industrial infrastructure in the region. Iran is also insisting that it has a “sovereign right” over the strait, though Washington says reopening the waterway is a condition for a cease-fire. [Continue reading…]