Iran's Islamic Revolutionary Guard Corps warned that "not one litre of oil" will pass through the Strait of Hormuz, threatening global energy supplies as crude prices surge toward $200 per barrel, according to Al Jazeera.
The Iranian warning comes as tensions escalate in the Persian Gulf, with Qatar halting production at a major facility last week. Shell declared force majeure on liquefied natural gas contracts from Qatar, signaling supply disruptions that could ripple through global energy markets.
The International Energy Agency responded by agreeing to release a record 400 million barrels from global strategic reserves, the largest coordinated release in the agency's history, according to Al Jazeera reporting.
The Strait of Hormuz handles approximately 20% of global oil shipments, making any disruption a significant threat to international energy security. Iran's threat to block the waterway has sent crude prices climbing sharply, with warnings that oil could reach $200 per barrel if the blockade materializes.
For Ethiopia, which imports 100% of its petroleum products, the price surge presents a severe economic challenge. The country already faces foreign currency shortages that complicate fuel imports, and higher oil prices would strain the government's fuel subsidy program that keeps domestic prices stable.
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Previous oil price spikes have forced Ethiopia to implement fuel rationing measures. A sustained increase to $200 per barrel would likely trigger inflation across all sectors of the economy, from transportation costs to food prices, as fuel price increases cascade through supply chains.
The National Bank of Ethiopia has been managing foreign exchange pressures as part of its macroeconomic reform program, but a dramatic increase in fuel import costs would add significant pressure to the country's balance of payments.
Ethiopia's fuel import bill already represents a substantial portion of the country's foreign currency expenditure. The government has been working to reduce subsidies as part of broader economic reforms, but a sharp oil price increase would complicate efforts to balance fiscal sustainability with social stability.
The threat to the Strait of Hormuz comes as global energy markets were already facing supply constraints and elevated prices. Any prolonged disruption to shipping through the waterway would force oil tankers to take longer routes around Africa, adding both time and cost to deliveries.
