What to know about the Strait of Hormuz, which Trump says will be opened Friday
By Hanna Ziady
When announcing the agreement made by Iran and the United States yesterday, US President Donald Trump said the Strait of Hormuz would reopen on Friday.
“With the opening of the Strait upon the signing of the Deal on Friday, for purposes of mine removal, oil will flow on both ends again for the Region, and the World!” Trump said.
The strait proved a major flashpoint during the conflict after it was effectively closed by Tehran following airstrikes by the US and Israel on February 28.
A narrow waterway that bypasses Iran and Oman, the Strait of Hormuz is the main route for shipping crude from oil-rich countries such as Saudi Arabia and Kuwait to the rest of the world.
About 20 million barrels of oil, or about one-fifth of daily global production, used to flow through the strait every day, according to the US Energy Information Administration, which calls the channel a “critical oil chokepoint.”
Few alternative routes exist to the Strait of Hormuz, and none of them come close to allowing the same volume of oil and gas exports to pass through.
After Trump’s announcement yesterday, oil prices fell to their lowest levels in more than three months.
However, crude prices remain around $10 a barrel higher than they were before the war. And the oil market still has significant work ahead to return flows from the Middle East and through the strait to normal.
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.