Lesson Learned From Iran War: Reduce Reliance on Strait of Hormuz

When Iran shut down the Strait of Hormuz during its war with the United States and Israel, countries and companies responded in ways that stopped the price of oil from reaching stratospheric levels and shielded most economies from major shocks.More oil was pumped through pipelines, and nations around the world released their oil reserves, mitigating a global shortage.Countries in Asia, which were hardest hit by the war, took steps to consume less fossil fuel and increase their use of green energy sources.

In recent weeks, the U.S.military helped tankers pass through the waterway.Some experts now believe those measures can be built upon to make the world much less vulnerable to any effort by Iran to close the strait in the future.“The Strait of Hormuz is no longer going to remain as critical a choke point as it was before this war,” said Vidya Mani, an associate professor at the University of Virginia and an expert on supply chains.Iran gained an early advantage in the war by attacking commercial ships.

This deterred shipping companies from passing through the strait, cutting off a large share of the world’s oil.But the blow was not as big as it might have been.The price of oil, which closed at $73.74 a barrel on Wednesday, soared but never reached the levels that could have led to a global recession.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access.

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