Iran’s unprecedented decision to block the Strait of Hormuz, the world’s most important energy route and strategic maritime passage, will have negative consequences for global trade. The highly globalized luxury goods sector is exposed.
Although Iran has been in a position of military weakness since the start of the conflict with Israel and the United States, it has just unleashed an unprecedented weapon that could cause serious damage to the global economy as a whole, and to the luxury sector in particular: the closure of the Strait of Hormuz. This is a situation that has never occurred before, including during previous regional conflicts (the Iran-Iraq War (1980-1987) and the Gulf Wars (1991 and 2003).
The threat made on March 2 by an Iranian general of the Revolutionary Guards to “burn any ship” attempting to cross the Strait of Hormuz and to block all oil exports from the Gulf was taken very seriously by the international community.
20% of the world’s oil and liquefied natural gas
Since the start of the strikes on Iran, the world’s largest shipping companies—France’s CMA CGM, China’s Cosco, Italy-Switzerland’s MSC, Denmark’s Maersk, and Germany’s Hapag Lloyd—had already ordered their fleets to seek shelter.
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Read also > War in Iran: luxury goods market in turmoil in the Middle East
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