Strait of Hormuz Might Close
Major Oil Impact
The Iranian parliament has approved the closing of the Strait of Hormuz for the first time since 1972.
If approved by the Iranian security apparatus, this would impact the shipping of more than 20 million barrels of oil per day. This body of water connects the Persian Gulf with the Gulf of Oman and the Arabian Sea and controls roughly 20% of the world’s petroleum consumption.
This drop in oil supply is expected to send prices higher. According to JP Morgan estimates, closure of this waterway could send oil prices at high as $130 per barrel. Stay tuned.