Last weekend, the sudden bombing of Iranian nuclear facilities by the United States may further break the fragile balance of geopolitics in the Middle East, add haze to the global economy that has been repeatedly affected by the US tariff policy, and make the major central banks around the world that are hovering between growth and inflation more "dilemma".
On the 21st local time, US President Trump declared that the US military had "successfully attacked" and "completely cleared" three Iranian nuclear facilities. On the 22nd, Kusari, a member of the National Security Committee of the Iranian Parliament, said that the Iranian Parliament has concluded that the Strait of Hormuz should be closed, but the final decision lies with the Supreme National Security Council of Iran.
Although the basic judgment of the market is still that Iran is unlikely to block the Strait of Hormuz; but if it is blocked, energy prices including oil will soar, and the risk of global inflation will be rekindled.
Anna Rosenberg, head of geopolitics at European asset management giant Amundi, told Yicai Global that in the short term, he does not expect the Strait of Hormuz to be blocked. As the conflict expands beyond Israel and Iran, attacks on Gulf oil infrastructure are more likely to occur. He believes that once Iran has no choice, it is more likely to disrupt transportation in the Strait of Hormuz by blocking the Strait or sending ships to intimidate. The Strait of Hormuz is a key channel, and any potential disruption or closure could have a significant impact on supply, pushing up oil prices. Assuming that transportation stops completely, Brent crude oil prices could soar to $100-120 per barrel.
Regarding the impact of higher international oil prices on China, many analysts believe that despite the current panic rise in oil prices, the supply chain has not actually been cut off, and the shock response of the international oil and gas market is still within the expected range. At present, China's domestic crude oil and liquefied natural gas (LNG) inventory supply is relatively sufficient, and import risks can be optimized in the short term by adjusting the procurement structure.
Impact on global energy price stability
Historically, Iran has threatened to block the Strait but has never implemented it. Given its severity, if it comes true, this move will restrict trade and affect global oil prices, and global economic development is highly dependent on the smooth flow of oil supply. As market concerns about the blockade of the Strait of Hormuz intensified, geopolitical risk premiums rose, pushing Brent crude oil futures and WTI futures to a five-month high on the 23rd.
The Strait of Hormuz is one of the most important trade routes in the world. Statistics from the U.S. Energy Information Administration (EIA) under the U.S. Department of Energy show that the average oil flow through the strait in 2024 will be 20 million barrels per day, equivalent to about 20% of the global consumption of liquid petroleum. In 2024 and the first quarter of 2025, oil flows through the Strait of Hormuz accounted for more than a quarter of the total global seaborne oil trade and about one-fifth of global oil and petroleum product consumption.
Not only is it an "oil choke point", the Strait of Hormuz also carries 20% of the world's liquefied natural gas (LNG) trade and concentrates energy exports from major Persian Gulf countries such as Saudi Arabia, the UAE, Iraq, Kuwait and Iran.
A senior person in the shipping industry told China Business News that if Iran blocks the Strait of Hormuz, it will not have a direct impact on European and American routes, but oil prices will be most affected. The senior person in the shipping industry explained to reporters that, in simple terms, the Strait of Hormuz is located between Oman and Iran, connecting the northern Persian Gulf with the southern Gulf of Oman and the Arabian Sea. Usually, the member countries of the Organization of Petroleum Exporting Countries (OPEC), namely Saudi Arabia, Iran, the United Arab Emirates, Kuwait and Iraq, mainly export crude oil to Asia through the strait.
Currently, Iran controls the northern part of the strait, which extends along its border, while Oman and the United Arab Emirates control the southern part. "If it is blocked, it will have the greatest impact on the Persian Gulf route, for example, ships going to Dubai will not be able to sail." He added.
The unstable situation in the Middle East and the rise in oil prices directly increase the costs of related industries. Comprehensive market data shows that insurance rates on the Middle East-Asia route have soared by 300%, and VLCC tanker freight rates have exceeded $53,000 per day; shipping around the Cape of Good Hope has increased costs by 40%, and the proportion of freight for China's Yiwu small commodities to Europe has increased sharply from 15% to 35%. The proportion of aviation fuel costs has risen to 35%, Lufthansa announced an 8% layoff and 10% of global routes have been suspended.
In the aviation industry, commercial airlines around the world are weighing the time to suspend flights to the Middle East after the US attack on Iran on Monday.
Paul Donovan, chief economist of UBS Global Wealth Management, told Yicai Global that investors are currently focusing mainly on the transportation and supply of oil and non-oil. Even a small increase in oil prices will push up US gasoline prices, just as trade tariffs have pushed up other prices, and may exacerbate inflation. In addition, the tourism industry in the Gulf region is already at risk, and many flights have been canceled. However, Donovan added that in fact, the US tariff policy poses a much greater threat to shipping volume than the geopolitical situation in the Middle East.
Global economy returns to uncertainty
Ellen Zentner, chief U.S. economist at Morgan Stanley, analyzed that the U.S. bombing of Iran's nuclear facilities has undoubtedly injected new uncertainty into the global economy. The most direct impact is the sharp rise in energy prices. Rising oil prices will not only push up household daily expenses, such as fuel and heating costs, but will also increase corporate operating costs, which may in turn suppress consumption and investment activities. He said that under the background of the Trump administration's high tariff policy, the U.S. economy is already facing pressure to slow growth, and further increases in oil and other energy prices will put "strong pressure" on household consumption capacity. This may not only weaken consumers' willingness to buy, but also drag down the pace of overall economic growth.
In addition to affecting the global economy and inflation prospects and putting pressure on households and businesses, if the Strait of Hormuz is blocked, the global supply chain will return to tension and the economic inflation outlook will deteriorate again, which will make global central banks, which are already in a dilemma between "maintaining growth" and "stabilizing inflation", more and more headaches.
Charu Chanana, chief investment strategist at Saxo Bank, said: "Rising oil prices have brought uncertainty about inflation at a time when global economic growth is slowing. This makes the work of global central banks more difficult - should they relax policies to support growth, or should they exercise restraint to avoid pushing up inflation? At present, most central banks around the world still seem to prioritize growth concerns, assuming that the rise in crude oil may not be sustainable."
What's more, the Federal Reserve itself is in a dilemma. This week, the market's attention will focus on the upcoming US economic data and the congressional testimony of Federal Reserve Chairman Powell. The surge in energy prices, the weakening of consumer power, and the possible escalation of regional conflicts have made the market tread on thin ice.
Wells Fargo economist Sam Bullard said that the latest developments in the Israeli-Iranian conflict have brought new complexities to the Fed's decision-making. The market will pay close attention to how the Fed can find a balance between the inflationary pressures brought about by rising energy prices and tariffs and the deflationary pressures brought about by slowing economic growth.