ECON FUNG RED *.*Economic Implications Concerning The Closing of the Strait of Hormuz

doctor_fungcool

doctor_fungcool

TB Fanatic
Rather than giving my opinion right off, I would like to hear what the membership thinks of this turn of events.

NOTE: This evening(newswise) will be full of economic headlines..


NOTE: Why RED ALERT? Y'all already know. This is not a war thread...it's strictly economic in scope. I will shut my mouth until this evening.
 
coalcracker

coalcracker

Veteran Member
Could be akin to a fistfight where you beat the living daylights out of your opponent. You leave him lying unconscious in a pool of his own blood. You leave the scene quite pleased with yourself, only later to discover that during the fight your opponent shanked you. The wound doesn't look too bad. You clean it with some hydrogen peroxide and put a bandage on it. You tell yourself that you'll be fine.

"You should see the other guy!"

You'll be fine, right? Right? Right????

You can never always sometimes tell.
 
hiwall

hiwall

Has No Life - Lives on TB
While a few repercussions of this war will show right away, most might take a year or even more to show up. It has only been a day and the war has just started. No one can factually say what will be the results of this war.
There are so many spinning plates right now that anything can happen any day. Whether we are at war or not.
 
Zagdid

Zagdid

Veteran Member
hiwall said:
While a few repercussions of this war will show right away, most might take a year or even more to show up. It has only been a day and the war has just started. No one can factually say what will be the results of this war.
There are so many spinning plates right now that anything can happen any day. Whether we are at war or not.
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I like the spinning plates analogy. Mine might be musical chairs and Jim Morrison singing dole fully about 'When the music stops'.
 
T

Taco Salad

Senior Member
It just depends on how long it's closed. It hasn't been that long since it was closed for weeks because someone couldn't drive. Personally I doubt it's down for more than a month or so but that's just an uneducated guess. Trump knows how important it is to keep goods and oil flowing through there because if things start coming in late and prices start going up people start crying and the media starts howling and whipping them up.

EDIT: Wrong I was thinking of the Suez Canal.
 
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Dobbin

Dobbin

Faithful Steed
emiliozapata said:
Ever heard the term " Nothing Burger"?
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The US for a while has been "self-supplied" in oil. No more "Arab Oil Embargo" is possible.

Joe depleting the Strategic Reserve was more a "we're waiting for China to invade" move than giving relief to American consumers.

Now prices WILL go up - somewhat - like any product driven by supply/demand. But it won't be like Owner's description of 1978.

Owner tells of standing on the roof of the power plant and looking out over Cape Cod Bay and beyond the "arm" of the Cape offshore he could see FIVE tankers waiting to offload at his plant - all waiting for the price to go up and be given the signal.

The "Arab Oil Embargo" was largely US created and MEEDIA supported. A war to seize the oil was hoped for - but didn't happen.

Dobbin
 
M

mecoastie

Has No Life - Lives on TB
Taco Salad said:
It just depends on how long it's closed. It hasn't been that long since it was closed for weeks because someone couldn't drive. Personally I doubt it's down for more than a month or so but that's just an uneducated guess. Trump knows how important it is to keep goods and oil flowing through there because if things start coming in late and prices start going up people start crying and the media starts howling and whipping them up.
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That was the Suez Canal not the Straits of Hormuz.
 
Hfcomms

Hfcomms

EN66iq
Oil or energy is the lifeblood of national and global economies. Close the strait has a knee jerk reaction but if it lasts very long it’s taking the grease away from the gears of the system. And it’s going to threaten China more than anyone. We are squeezing China’s energy supply lines. China got a whole lot of oil from Russia, Iran and Venezuela.

With the action against the Venezuelan regime that oil has been removed from China and now the oil not only sourced from Iran but the gulf as a whole are threatened. Russia is still up but Russia can’t supply all the Chinese demand. Geopolitics one, two three. It’s going to hurt us if this goes on very long but it is a direct and kinetic shot across China’s bow.
 
W

Wyominglarry

Veteran Member
Once this evil regime falls and the Iranian people hopefully form a constitutional republic they tell China oil to you will cost Brent price plus $25 per barrel. All the other Gulf countries will charge China the same price. This in turn bankrupts China and they too have a failed regime and the people revolt and form a new government that is not communist.
 
Tigerlily

Tigerlily

Veteran Member
Hfcomms said:
Oil or energy is the lifeblood of national and global economies. Close the strait has a knee jerk reaction but if it lasts very long it’s taking the grease away from the gears of the system. And it’s going to threaten China more than anyone. We are squeezing China’s energy supply lines. China got a whole lot of oil from Russia, Iran and Venezuela.

With the action against the Venezuelan regime that oil has been removed from China and now the oil not only sourced from Iran but the gulf as a whole are threatened. Russia is still up but Russia can’t supply all the Chinese demand. Geopolitics one, two three. It’s going to hurt us if this goes on very long but it is a direct and kinetic shot across China’s bow.
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This is the very reason the economy will crash hard. China is in a bad state, not unlike the embargo on Japan during WWII. Remember, that was the reason they hit Pearl Harbor. China will probably announce that they are NOT allowing anymore shipments for anything to the US. That will cause devastating consequences to each of us. We are not prepared for that.
 
Kathy in FL

Kathy in FL

Administrator
_______________
Tigerlily said:
This is the very reason the economy will crash hard. China is in a bad state, not unlike the embargo on Japan during WWII. Remember, that was the reason they hit Pearl Harbor. China will probably announce that they are NOT allowing anymore shipments for anything to the US. That will cause devastating consequences to each of us. We are not prepared for that.
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It will kill China before it kills the US. And other countries in Asia are already picking over China’s formerly exclusive markets.
 
King Samson

King Samson

I'm Here
Kathy in FL said:
Where does Venezuela fit in all of this?
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We get their oil.

There might be a short term, knee jerk reaction to closing the Straits, but Trump won't let it last long. As I said in the other long thread, I'm sure we're watching the Iranian coast VERY Clearly, and will blow up any missile sites along that coast. We've known, for a LONG time, that area was critical.
 
D

dunebuggy

Senior Member
The straits are closed as of this morning. zerohedge has graphs up showing that shipping is down to a standstill:

Three Maritime Incidents Reported In Strait Of Hormuz Energy Chokepoint<!-- --> | ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero
www.zerohedge.com www.zerohedge.com

that's why this is a desperate gamble by the Ziocons. The dollar empire is crumbling and we must have iran's oil to prop up the dollar. And unless the IRGC has a secret deal with clown world, as vox day mentioned this morning, this could be a long and drawn out war.

Anomalies of the Air War - Vox Popoli

Reported details on the scale of the initial air assault on Iran from the Jerusalem Post. Having already dropped 1,200 bombs on Iran, the IDF, along with the US Air Force, is close to achieving air supremacy in Iranian airspace. In June 2025, it took several days for the air force to achieve...
voxday.net voxday.net

Finally, who are the regime’s replacements? Is it possible this is just a larger version of the inside job on Maduro by Iranians beholden to Clown World? If we see a rapid peace deal promptly declared with the new Iranian regime that abandons BRICS and stands with Israel, we’ll have a pretty good idea what actually happened.
 
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W

WalknTrot

Veteran Member
The Straits closed, shipping over there munged for a while, oil shortages - maybe.

But I'm real ambivalent. The ones closest to the problem are going to be affected most, but they are the ones who were closest to, and put up with/bent over for all the crap the Iranian regime dished out for nearly 5 decades.

We in the U.S. are pretty self sufficient, and far removed, yet again, we spend our blood and treasure to clean up another global mess. Far as I'm concerned, the heck with Europe, UK, and the Middle East. Let them take up a notch in their belt and pay through the nose for a while 'til things get back to par. It's the least they can do. And it always seems to be the least. :rolleyes:
 
C

Cedar Lake

Connecticut Yankee
It's not just the Straits of Hormuz, there's a bigger picture now evolving, oil platforms, Chervon's oil infrastructures.

An oil platform belonging to the UAE in the Persian Gulf was targeted by an Iranian drone.

t.me

Enemy Watch — Official

—An oil platform belonging to the UAE in the Persian Gulf was targeted by an Iranian drone. @enemywatch
t.me t.me
 
Seeker22

Seeker22

Has No Life - Lives on TB
coalcracker said:
Could be akin to a fistfight where you beat the living daylights out of your opponent. You leave him lying unconscious in a pool of his own blood. You leave the scene quite pleased with yourself, only later to discover that during the fight your opponent shanked you. The wound doesn't look too bad. You clean it with some hydrogen peroxide and put a bandage on it. You tell yourself that you'll be fine.

"You should see the other guy!"

You'll be fine, right? Right? Right????

You can never always sometimes tell.
Click to expand...

That shank was dipped in rancid cat crap
Now, whatcha gonna do?
 
Seeker22

Seeker22

Has No Life - Lives on TB
Hfcomms said:
Bingo. All that oil from Venezuela that China will no longer be able to buy will gladly be absorbed by the U.S. therefore minimizing the effect on us from the lack of middle eastern oil if a regional war really gets going.
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That Venezuelan oil is heavy crude good for running big gray ships. Not the light sweet crude we make into gasoline.

Refining capability for LSC in Venezuela will have to be repaired and/or upgraded. That will take time we don't have now that the Straights have been closed. Now what?
 
M

mecoastie

Has No Life - Lives on TB
Cedar Lake said:
It's not just the Straits of Hormuz, there's a bigger picture now evolving, oil platforms, Chervon's oil infrastructures.

An oil platform belonging to the UAE in the Persian Gulf was targeted by an Iranian drone.

t.me

Enemy Watch — Official

—An oil platform belonging to the UAE in the Persian Gulf was targeted by an Iranian drone. @enemywatch
t.me t.me
Click to expand...
That will have the long term impact. If Iran can damage or destroy enough oil infrastructure in the Middle East then oil prices will stay up for a good while until that infrastructure can be replaced or other areas can increase production.
 
B

Ben Sunday

Has No Life - Lives on TB
The dynamics of Western oil consumption is very different from earlier episodes of embargoes or geopolitical upheaval. Closure of the SoH will be more of blip instead of a cancerous tumor. The Iranian navy (and the tattered remains of their air force) can not maintain a closure.

My opinion: SoH closed for a week, maybe two.

Impact: Our domestic production along with still functioning Middle East nations and the eventual return of Venezuelan oil output should mitigate the possibility of any significant oil shocks.

Prices? I expect markets tomorrow to open around $80 to $85 a barrel. High end? A very brief run around $110.

I share the general anxiety of the moment but am not ready to capitulate to fear.
 
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