Mirror Review
June 24, 2025
Imagine a single, narrow stretch of water, so vital that its blockage could shake the global economy!
This is the reality of the Strait of Hormuz, a critical waterway now at the center of the latest US Iran Oil Conflict.
On Sunday, the conflict worsened when 125 US aircraft were dispatched to disable three Iranian nuclear sites: Fordo, Natanz, and Isfahan.
In response, Tehran’s retaliatory missiles struck American bases in Qatar on Sunday.
And thus, a global tension boiled over, with everyone now questioning: How much power does Iran hold over this crucial passage?
The Strait of Hormuz: The Main Artery of Global Oil
The Strait of Hormuz is the world’s most vital oil transit chokepoint.
This passage, which connects the Persian Gulf with the Gulf of Oman, is the main artery for a significant portion of global energy supplies.
Here’s an idea of its importance:
- Last year, an average of 20 million barrels of oil passed through the strait each day.
- This volume represents about 20% of the world’s total petroleum consumption.
The U.S. Energy Information Administration has made the stakes clear, stating, “Very few alternative options exist to move oil out of the strait if it is closed”.
This geographic reality gives Iran a strong strategic advantage.
For years, Tehran has threatened to shut down the strait as its ultimate trump card in any conflict. But is the threat practical?
Analysts at S&P Global Market Intelligence suggest a more nuanced approach is likely: Iran’s naval forces might harass or block specific ships, but it may not attempt a full, prolonged closure.
Will The Oil Conflict Affect You?
For most people, this conflict feels a world away.
But its effects could arrive directly at your local gas station.
Any disruption, big or small, in the Strait of Hormuz could cause energy prices to surge globally.
And this couldn’t come at a worse time for American consumers.
Many are already feeling squeezed by high inflation, and economists expect a new wave of tariffs to push prices even higher!
James Knightley, an economist at ING, describes the potential for a perfect storm.
He says there’s already “quite a lot of anxiety” about tariffs and warns that higher energy costs could be “another wave of pain for the consumer”.
This threatens to “squeeze households’ spending power” and risk a “pronounced slowdown in the economy”.
The President’s Warning
The White House is aware of the risks
President Trump has long seen energy costs as a key indicator of his economic agenda’s success. Therefore, he is now concerned about how high gas prices could affect his popularity.
Trump took to social media to demand that companies “KEEP OIL PRICES DOWN,” warning that failing to do so would be “PLAYING RIGHT INTO THE HANDS OF THE ENEMY”.
The President also urged the Energy Department to increase domestic oil production “NOW!!!”.
This situation is complicated by the strict U.S. sanctions already targeting Iran’s oil sector, designed to cut off a primary source of the nation’s revenue.
Moreover, Federal Reserve Chair Jerome H. Powell confirmed the central bank is monitoring the situation.
He also noted that while Mideast turmoil often causes temporary price spikes, the impact tends to fade.
Furthermore, he pointed out that “the US economy is far less dependent on foreign oil than it was back in the 1970s”.
So, Does Iran Hold Complete Power?
While America’s energy independence has grown, it isn’t fully independent.
Even with less reliance on foreign oil, economists like James Knightley warn that a major disruption would still cause domestic gas prices to “rocket higher”.
The White House press secretary, Karoline Leavitt, assured reporters that the administration is “actively and closely monitoring the situation”.
The core of the US Iran Oil Conflict remains a delicate balance between military decisions and economic stability.
As tensions grow, the world watches the Strait of Hormuz, knowing that any more conflicts could have unavoidable consequences for the global economy and consumers everywhere.
