The Strait of Hormuz is a strategically important strait between the Gulf of Oman and the Persian Gulf. The Bosphorus is named after Hormuz, the god of good fortune mentioned in the Avesta.
Why is the Strait of Hormuz so important?
5 main factors that make our price strategic and important
1. It is considered one of the main sea routes connecting the oil fields of the Middle East with the markets of Asia, Europe and North America.
2. About 20% of the world's oil flows through the Strait of Hormuz, making it critical to global energy security.
3. The Bosphorus is of strategic importance and regularly hosts military exercises by Iran as well as the US and its allies.
4. If there is a conflict between Iran and Israel, the strait could be closed, which could immediately increase the price of oil and hit the global economy.
5. Depending on the duration and intensity of any conflict, Global GDP may decrease by 5-10%.