The Iranian Parliament has approved a bill that proposes the closure of the Strait of Hormuz—a strategic maritime route through which approximately 20% of the world’s oil is transported. This decision is a response to U.S. airstrikes on Iranian nuclear facilities, and the final say on the closure of the strait will be determined by the country’s highest security authority.
This is reported by Finway
The Strait of Hormuz: Key to the Global Oil Market
The Strait of Hormuz is vital for global energy, as it carries the main oil flows from Saudi Arabia, the UAE, Qatar, Kuwait, Iraq, and Iran itself. In light of news about a potential blockade of the route, oil prices began to rise on June 23: August futures for Brent reached $78 per barrel, while WTI hit $75 per barrel.
Possible Consequences for Prices and the Global Economy
According to estimates by Goldman Sachs experts, if the Strait of Hormuz is actually closed, the price of Brent could temporarily rise to $110 per barrel; however, by the fourth quarter of 2025, the average price is expected to be around $95 per barrel. In the European gas market, analysts predict a spike in the price of TTF to €74 per megawatt-hour, which corresponds to approximately $900 per thousand cubic meters of gas.
At the same time, the International Monetary Fund warns of potentially broader negative consequences. IMF Managing Director Kristalina Georgieva emphasizes that the conflict surrounding Iran creates additional uncertainty for the economy and business worldwide.
“When there is uncertainty, what happens? Investors do not invest, consumers do not consume. And this restrains growth prospects,” Georgieva said.