Economists warn Strait of Hormuz blockade will affect more than just fuel

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Economists from the United Nations Economic and Social Commission for Asia and the Pacific (UN-ESCAP) warn that as tensions escalate, the Strait of Hormuz is becoming more than just an energy bottleneck, emerging as a broader transport chokepoint.

“The ongoing conflict in Western Asia and disruption of the Strait has triggered what could become the region’s most severe energy supply crisis in decades,” ESCAP has said in an analysis.

“This is not just an energy story; it shows how deeply interconnected economies are today, where disruption in one region ripples across trade, transport, manufacturing, and even food security across the region.”

For landlocked developing countries, the stakes are higher. With Iranian hubs like Bandar Abbas and Chabahar suspending operations, alternatives are limited and unreliable, says the team of economists led by Hamza Ali Malik, Director of the Macroeconomic Policy and Financing for Development Division.

Meanwhile, shipping diversions are adding 10 to 15 days to transit times, delaying critical goods from EV batteries to pharmaceutical inputs.

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