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$100? $200? $300? – How Catastrophically High Will The Price Of Oil Go When Iran Closes The Strait Of Hormuz?
It is being reported that Iran is seriously considering closing the Strait of Hormuz. We don’t know how high the price of oil will go if that happens, because it has never happened before. Of course I think that it would be safe to assume that the price of oil would rapidly surpass the $100 mark, and if it stays there for an extended period of time that would be enough to push us into a recession all by itself. But if the price of oil were to surpass the $200 mark and stay there, I believe that could be enough to actually push us into an economic depression. Shockingly, as you will see below, there is one official in the Middle East that is convinced that the price of oil could go up to $300 a barrel if Iran closes the Strait of Hormuz. Needless to say, that would be a nightmare scenario.
All of this has been coming for a long time. As I documented on Friday, we were warned that the price of oil would go nuts once a major war erupted between Israel and Iran, and we were also warned that Israel would be blamed for the high price of oil because they struck first. At the end of last week the price of oil was up about 5 dollars a barrel, but if the Strait of Hormuz gets closed that will send the price of oil into the stratosphere.
Unfortunately, we are being told that Iranian leaders are “seriously” considering making such a move…
The closure of the strategic Strait of Hormuz is being seriously reviewed by Iran, IRINN reported, citing statements by Esmail Kosari, a member of the parliament’s security commission.
The Strait of Hormuz, which lies between Oman and Iran, is the world’s most important gateway for oil shipping.
The Iranians understand that they can hold the global economy hostage, because approximately 20 percent of all global oil consumption travels through the Strait of Hormuz…
According to the US Energy Information Administration, about 20 percent of global oil consumption flows through the strait, which the agency describes as the “world’s most important oil transit chokepoint”. At its narrowest point, it is 33km (21 miles) wide, but shipping lanes in the waterway are even narrower, making them vulnerable to attacks and threats of being shut down.
If the Iranians do this, most experts are anticipating that the price of oil will go well above $100 a barrel.
But Iraqi Foreign Minister Fuad Hussein believes that the price of oil could actually rise as high as $300 a barrel…
Escalating tensions in the Middle East and a potential closure of the Strait of Hormuz could drive oil prices up to $300 per barrel, Iraqi Foreign Minister Fuad Hussein warned during a phone conversation with German Foreign Minister Johann Wadephul.
On Friday morning, Israeli jets bombed military and nuclear sites across Iran, kicking off an ongoing exchange of hostilities between the two countries.
According to Hussein, oil prices could surge to between $200 and $300 per barrel “if military operations were to break out, which would significantly increase inflation rates in European countries and complicate oil exports for producing states such as Iraq.”
I don’t think that we will see the price of oil go quite that high.
But if the price of oil even doubles from current levels, it will be a crippling blow for the global economic system.
And even if the Strait of Hormuz is not closed down, this war is going to push the price of oil much higher anyway.
After the Iranians started hitting major cities in Israel, the Israelis started going after Iranian energy infrastructure.
For example, we now have stunning video of fires at the Shahran oil depot in Tehran reaching into the night sky…
And an Israeli drone strike has caused extensive damage at a very important refinery in Iran’s Bushehr province…
A fire broke out at Kangan Port in Iran’s Bushehr province following an Israeli drone strike targeting on onshore refinery at Phase 14 of the South Pars gas field in the Persian Gulf on Saturday. It was the first attack by Israel specifically targeting Iran’s critical energy sector.
Of course destroying Iran’s energy infrastructure is not the primary goal for Israel.
The primary goal is to damage Iran’s nuclear facilities as much as possible.
At Natanz, it appears that IDF strikes have been “extremely effective”…
Initial assessments indicate that Israel’s strikes on Iran’s Natanz nuclear facility were extremely effective, going far beyond superficial damage to exterior structures and knocking out the electricity on the lower levels where the centrifuges used to enrich uranium are stored, two US officials told CNN.
“This was a full-spectrum blitz,” said another source familiar with the assessments.
The strikes destroyed the above-ground part of Natanz’s Pilot Fuel Enrichment Plant, a sprawling site that has been operating since 2003 and where Iran had been enriching uranium up to 60% purity, according to the International Atomic Energy Agency (IAEA). Weapons-grade uranium is enriched to 90%.
But Fordow is an entirely different story.
Without U.S. help, Israel simply does not have the ability to do much damage there…
The Fordow Fuel Enrichment Plant is a far more difficult site to target. The plant is buried deep in the mountains near Qom, in northern Iran, and houses advanced centrifuges used to enrich uranium up to high grades of purity.
Israel targeted the site during its Friday attacks, but the IAEA said it was not impacted and the IDF has not claimed any significant damage there. Iranian air defenses shot down an Israeli drone in the vicinity of the plant, Iranian state media outlet Press TV reported Friday evening.
“The expectation has always been that Israel would not be able to reach (Fordow), because it would need the kind of bunker-buster, massive ordinance bombs that only the United States has,” Vaez said.
If Fordow continues to operate once this is all over, it will be a major defeat for Israel and a major victory for Iran.
So we will want to watch what happens at Fordow very closely.
Israel is also working to eliminate as many Iranian nuclear scientists as possible.
So far, it appears that a total of 14 Iranian nuclear scientists are dead…
Israel has killed 14 Iranian nuclear scientists in a series of attacks that reportedly included car bombs, Iran has claimed.
Sources told Reuters that the attacks, which have taken place since Friday, were designed to cripple Iran’s ability to create nuclear weapons. Local media reported Tehran was hit by five car bombs.
Ultimately, Israel wants to make it impossible for Iran to produce nuclear weapons.
But could this war make Iran more determined than ever to push forward with their program?
Right now, Iranian lawmakers are reportedly considering a bill which would withdraw Iran from the Nuclear Non-Proliferation Treaty…
On Sunday, Iranian lawmakers pushed forward a bill to withdraw from the Nuclear Non-Proliferation Treaty (NPT).
MP Meysam Zahourian revealed an expedited bill mandating Iran’s exit from the NPT under Article 10, which permits withdrawal in the face of extraordinary threats to national interests, awaiting formal endorsement and legal review.
Zahourian described the move as a legal countermeasure to recent developments undermining Iranian sovereignty, and is expected to proceed rapidly through the Islamic Consultative Assembly (Iran’s Parliament).
So why would Iran want to withdraw from that treaty?
I will give you only one guess.
The Nuclear Non-Proliferation Treaty prevents nations that currently do not have nuclear weapons from getting them.
If Iran pulls out of that treaty, this crisis will go to an entirely different level.
For decades, we have been warned of the threat of nuclear war.
But that threat has never materialized.
Sadly, I believe that we live at a time when nuclear weapons will actually be used.
This “final showdown” between Israel and Iran is one of the most important signposts that we have ever seen.
Missiles are flying back and forth even as I write this article, and things are going to get extremely chaotic in the days ahead.
Michael’s new book entitled “10 Prophetic Events That Are Coming Next” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.
About the Author: Michael Snyder’s new book entitled “10 Prophetic Events That Are Coming Next” is available in paperback and for the Kindle on Amazon.com. He has also written nine other books that are available on Amazon.com including “Chaos”, “End Times”, “7 Year Apocalypse”, “Lost Prophecies Of The Future Of America”, “The Beginning Of The End”, and “Living A Life That Really Matters”. When you purchase any of Michael’s books you help to support the work that he is doing. You can also get his articles by email as soon as he publishes them by subscribing to his Substack newsletter. Michael has published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and he always freely and happily allows others to republish those articles on their own websites. These are such troubled times, and people need hope. John 3:16 tells us about the hope that God has given us through Jesus Christ: “For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.” If you have not already done so, we strongly urge you to invite Jesus Christ to be your Lord and Savior today.
The post $100? $200? $300? – How Catastrophically High Will The Price Of Oil Go When Iran Closes The Strait Of Hormuz? appeared first on The Economic Collapse.
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