Bhubaneswar, March 16: Delving deeper into the ongoing gulf crisis, geo-political experts as well as economists are reportedly viewing it as “an early signal of a fast changing global order and reconfiguration”.
Even though it surfaces to be an apparently “regional confrontation”, the dire need of fossil fuel/crude oil not only reigns supreme, but also rules the roost in the energy sector, and has also made the global economy go virtually kaput.
While the USA led by the incumbent Trump regime appears to be a “big bully hell bent on dictating the terms”, “whims and fancies” of Israel led by “vindictive” Netanyahu are alleged to be “taking the world order into their sole ride”.
It has been observed till date that, the international system has been standing on the well-known “petrodollar order” since the fossil fuel has reportedly been traded in US dollars ($), and has, thus, placed the US dollar ($) as the “pivot of global commerce”.
But, the current gulf crisis has reportedly made it crystal clear that the devastating development has hit hard the “petrodollar order”.
Iran’s supremacy over the Strait of Hormuz has now stood as a Himalayan hurdle as well as a catastrophic stumbling block.
Pertinent to note that: “The Strait of Hormuz is a strait between the Persian Gulf and the Gulf of Oman. It provides the only sea passage from the Persian Gulf to the open ocean and is one of the world’s most strategically important choke points.”
As per reports and statistics, “20% of the world’s liquefied natural gas (LNG) and 25% of seaborne oil trade passes through the Strait of Hormuz, illustrating its important location for trade during 2023–2025.”
According to the US Energy Information Administration: “An average of 14 tankers per day passed out of the Persian Gulf through the strait carrying 17 million barrels (2,700,000 m3) of crude oil in 2011, while more than 85% of these crude oil exports went to Asian markets on a daily basis, with Japan, India, South Korea and China the largest destinations. In 2018, 21 million barrels a day passed through the strait, worth $1.2 billion at 2019 prices.”
Reports further stated: “During 2023–2025, 20% of the world’s liquefied natural gas (LNG) and 25% of seaborne oil trade passed through the strait annually. The strait had never been closed for extended time during Middle East conflicts (unlike the Straits of Tiran/Bab-el-Mandeb) though Iran occasionally had threatened to close the strait, and preparations to mine it have been undertaken.”
Experts aver, “If shipping through the Strait of Hormuz were significantly disrupted for an extended period, it could lead to a major oil supply crisis for major Asian importers such as India and China.”
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