00:00Why is the Strait of Hormuz crucial for the global energy market?
00:10On the 22nd of June, Iran's parliament voted to close the Strait of Hormuz, a retaliation
00:15against Israeli and US strikes on the country aimed at nuclear sites.
00:19For economists, such a move could wreak havoc across global markets.
00:23The final decision to close the strait lies with Iran's Supreme National Security Council,
00:27which has not ordered any closure as of yet and has never carried through past threats.
00:32The checkpoint for oil and natural gas is located between Oman and Iran, connecting the Persian
00:37Gulf with the Gulf of Oman and the Arabian Sea.
00:41In 2024 and early 2025, one-fifth of the world's oil and petroleum product consumption, as well
00:47as liquefied natural gas, flowed through the Strait of Hormuz.
00:52Saudi Arabia moves the most oil, while Qatar exports the most global liquefied natural
00:58gas through the strait.
00:5984% of oil and 83% of natural gas, which went through the strait in 2024, was routed to Asia.
01:07While Europe is less reliant on energy resources flowing through the strait, if it were to close,
01:12it could face the devastating repercussions of rising global oil and gas costs.
01:16In 2024, the average oil barrel price was $81, according to the Brent benchmark.
01:22But analysts forecast prices could exceed $120 per barrel if Iran carries its threats through.
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