Rising hostilities involving the United States, Israel, and Iran could unleash a full-blown global economic crisis if fighting spreads across the Persian Gulf, a leading Middle East economic analyst has warned.
Dr. Ayman Omar, a Lebanese academic and economic observer, told Sputnik that escalating conflict in the Gulf risks “strangling” the Strait of Hormuz — one of the world’s most critical oil and liquefied natural gas (LNG) transit routes.
According to Dr. Omar, any prolonged disruption in the narrow waterway could send global crude prices soaring to $100 per barrel — and potentially as high as $120 if oil production facilities are hit or exports remain blocked.
The Strait of Hormuz serves as a vital artery for Gulf producers, including Saudi Arabia and the United Arab Emirates, funneling millions of barrels of oil daily to global markets.
While alternative export routes exist — including overland pipelines — Dr. Omar stressed that they lack the capacity to offset the supply gap that would follow a full closure of the strait.
“A sustained price surge would shave at least one percent off global economic growth,” he warned, adding that rising inflation could drive investors toward safe-haven assets such as gold.
Food Prices at Risk
Beyond energy, the conflict threatens to ripple into global food markets.
Iran and other Gulf states are key players in petrochemicals and fertilizer exports, essential components of modern agriculture. Any disruption, Dr. Omar explained, would sharply raise farming costs — particularly across Asia and Africa, where food systems are already under pressure.
Higher fertilizer and input costs would translate directly into increased food prices, potentially deepening inflationary strains in vulnerable economies.
Traffic Reportedly Halted
Adding to market anxiety, recent media reports indicate that oil traffic through the Strait of Hormuz has already been temporarily halted, though independent verification and official confirmations are still emerging.
If sustained, such a stoppage could mark a dangerous new phase in the crisis — one with consequences far beyond the battlefield.
With global supply chains still fragile, economists warn that the Persian Gulf may now hold the key to whether the world faces another severe energy and inflation shock.
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