As the world worries about a possible blockade of the Strait of Hormuz, Donald Trump did not mince words in his address to the Iranian regime. Let’s take a look at the threats made by the U.S. president.
Donald Trump threatens the Iranian regime over possible blockades of the Strait of Hormuz
With the war in Iran, the situation in the Strait of Hormuz has been making headlines for several days, as the world fears fuel shortages in the event of a blockade of this waterway connecting the Persian Gulf and the Gulf of Oman.
For now, despite limited traffic, ships still appear to be able to pass through the area, as shown in particular by the real-time tracking tool VesselFinder:
Live maritime traffic in the Strait of Hormuz
On Monday, Emmanuel Macron stated that France was preparing a “purely defensive” operation with its partners, with the aim of escorting ships in the area. For his part, Donald Trump made some more… “Trump-like” remarks overnight on his social media platform, Truth Social:
If Iran takes any action that disrupts the flow of oil through the Strait of Hormuz, the United States of America will strike it twenty times harder than it has ever been struck before. Furthermore, we will neutralize easily destroyable targets, making it virtually impossible for Iran to rebuild itself as a nation. Death, fire, and fury will rain down upon them. But I hope and pray that this does not happen! This is a gift from the United States of America to China and to all nations that rely heavily on the Strait of Hormuz. Let us hope this gesture will be greatly appreciated.
Strategically speaking, the Strait of Hormuz does indeed play a crucial role, as it serves as the maritime gateway for Gulf countries to the rest of the world. While a shortage has not yet occurred, we have already seen people rushing to the gas pump—both out of fear that a shortage might occur and due to herd behavior.
In any case, the current crisis is having an impact on oil prices. Since the Israeli-U.S. strikes, the price of WTI has risen by more than 29%, while Brent has risen by 24%:
Brent prices (daily data)
If the situation worsens, prices could continue to rise, but caution is still advised if you want to try your luck in the financial markets. It’s worth noting that WTI and Brent have already corrected by 23% and 20%, respectively, from their Monday highs, and that a potential worsening of the crisis may already be priced in.
