Iran’s potential mining operation in the Strait of Hormuz has raised significant concerns among global energy markets. According to reports, Iran has been preparing to deploy mines in the region, which could disrupt one-fifth of global oil demand and lead to a spike in energy prices. This move is seen as a strategic attempt to exert pressure on the West, especially in the context of the ongoing conflict with Israel.
The conflict between Israel and Iran, which has seen repeated threats from Iran to block the Strait of Hormuz, has added to the uncertainty in the global oil market. Experts warn that any disruption to Gulf oil supplies would likely result in higher global crude prices, with Russian crude prices also rising in line. This could provide a significant financial boost to Russia’s economy, which is heavily dependent on oil exports to fund its war efforts in Ukraine.
Analysts suggest that the mining of the Strait of Hormuz would be a last resort for Iran, as it would also block its own oil exports. However, the potential for increased energy prices could still have a substantial impact on global markets. The situation is further complicated by existing Western sanctions on Russian energy and the G7’s oil price cap, which have limited Russia’s profits but not to a crippling extent.
The recent conflict between Israel and Iran has already had an impact on oil prices, with a spike following the Israeli strike on Iran. This has been seen as a potential reprieve for Russia’s economy, but the situation remains volatile. The potential for another surge in oil prices remains a pressing concern for global markets and energy-dependent economies.