Iran Approves Strait of Hormuz Closure – Global Energy Markets on Edge
Iran's parliament voted on June 22 to approve a proposal to shut down the Strait of Hormuz, the world's most critical oil chokepoint. The final decision now rests with Iran's Supreme National Security Council.
Why This Matters
• 20% of global oil supply transits through this narrow passage
• Potential $150+/barrel oil spike if implemented
• Would disrupt 15 million barrels/day of shipments
Geopolitical Context
The move comes amid:
🔥 Escalating Israel-Hezbollah tensions
💣 Stalled nuclear deal negotiations
⚔️ Recent Iranian threats to retaliate against Western sanctions
Market Reactions
Preemptive responses include:
📈 Brent crude up 3.2% to $87.50 on the news
🛢️ Saudi Aramco preparing alternative pipeline capacity
🇺🇸 U.S. Fifth Fleet increasing patrols in Persian Gulf
Potential Scenarios:
Limited blockade (insurance premiums soar)
Total closure (global recession risk)
Status quo maintained (after show of force)
Expert Warning: "Even temporary disruption could trigger 1970s-style oil crisis" - RBC Capital Markets