What Are the Implications of a Protracted Middle East Conflict? : BI Replay

Escalating tensions around Iran and the Strait of Hormuz are reverberating across global markets. The waterway is the world’s most critical energy chokepoint, carrying roughly 20% of global oil supply each day. Much of the focus has been on a conflict lasting several weeks to several months. To offer a different perspective, we explore the potential implications of a protracted conflict - one characterized by prolonged periods of relative calm punctuated by opportunistic military engagements. Under such a scenario, commercial traffic through the Strait of Hormuz could be severely disrupted. We discuss the immediate transitional shocks and the gradual market adaptations that may unfold over time. Discussion topics include: - Political constraints and escalation risks - Military dynamics - Energy market implications - Shipping, LNG and infrastructure impacts