The disturbing ‘new normal’ in the Strait of Hormuz: Attacks on ships at a record high and oil at $100 a barrel

Key Points:

• The war on Iran, initially planned as a brief limited incursion by Donald Trump and Benjamin Netanyahu, has dragged on for nearly eight months with negotiations deadlocked and oil prices stubbornly above $100 a barrel.
• The Strait of Hormuz, a critical oil shipping route, is experiencing its most violent period with a record number of drone and missile attacks on oil ships, severely disrupting global oil flows and raising concerns about physical supply risks.
• In response to soaring fuel costs ahead of the US midterm elections, Donald Trump lifted sanctions on Russia to increase diesel exports, highlighting the global economic impact of the conflict and energy instability.
• Experts warn that the ongoing chaos in Hormuz threatens the global economy, with attacks becoming more frequent and diverse, increasing risks to Gulf exports and causing high insurance and operating costs for shipping.
• The conflict is also exacerbating food security issues in Asia and Africa due to disrupted fertiliser shipments through Hormuz, combined with other global factors like El Niño and Black Sea supply disruptions, posing significant economic risks in the Middle East and Central Asia.