Closure of the Strait of Hormuz: First governments in Asia order home office

In view of the de facto closure of the Strait of Hormuz, through which a considerable part of the world's oil is transported, the first governments in Asia have ordered energy-saving measures and called for work from home. Such directives were issued, for example, in Thailand, Pakistan and the Philippines, Bloomberg reported, among others. In Pakistan and the Philippines, a four-day week has also been ordered, and in Thailand, air conditioners are now only to cool to a maximum of 26 to 27 degrees Celsius. State employees are also only to travel abroad for truly urgent events, and in Thailand, the government is even calling for people to use stairs instead of elevators.

Central shipping route mined?

The energy-saving measures are reminiscent of directives used to minimize human contact at the beginning of the corona pandemic to slow the spread of the virus. They are now being introduced in states that are particularly dependent on oil supplies from the Middle East. The approximately 55-kilometer-wide Strait of Hormuz between Iran and Oman is considered one of the most important shipping routes for global oil exports. It has been effectively blocked since the beginning of the war against Iran. This means that almost 15 million barrels of crude oil per day and another 4.5 million barrels of refined fuels, totaling 20 percent of global oil consumption, are lost, CNN summarizes. This gigantic amount cannot be replaced by other routes and corresponds roughly to the amount of oil that was saved globally during the lockdowns against Covid-19.

On Tuesday, a CNN report added to the de facto blockade of the waterway, according to which Iran has begun to mine the shipping route. One of the anonymous sources reportedly said that Iran still has the majority of its small boats and mine layers. In addition to the few dozen mines laid, the Islamic Republic could lay hundreds more in the Strait of Hormuz. US President Donald Trump has threatened the regime with retaliation "on an unprecedented scale" should "mines have been laid for any reason." They would have to be removed. The USA and Israel have been carrying out airstrikes on Iran since February 28, to which Iran has responded with missile and drone attacks on neighboring countries, among other things.

Fearing an oil shortage, the price of the reference grade for most of the world's traded oil grades jumped to over 120 US dollars overnight on Monday. This was the highest level since the summer of 2022. At German gas stations, fuel prices temporarily rose to over two euros per liter. This was followed by sharp criticism from gas station operators of the oil companies, and the development has also sparked a debate about a possible price cap. Statements by US President Donald Trump about a possibly imminent end to the war against Iran then caused oil prices to fall again, most recently they were slightly below 90 US dollars.

(mho)