Will the Iran war trigger a global economic crisis?
While Iran's de facto blockade of the Strait of Hormuz is causing oil and gas prices to rise sharply, US President Trump has called on Nato and Asian states to help secure this critical waterway for global shipping. Europe's media analyse the US's response to this emerging energy crisis and outline its global economic and social impact.
Poverty will be rife
Jornal de Notícias paints a bleak picture of the global economy:
“It will be only a matter of months before a recession sets in, which in turn will bring unemployment and impoverishment. That may sound like a catastrophic prediction (and hopefully it is), but that is precisely what history teaches us. The signs heralding an economic disaster are easy to spot, even for a layman. What can never be predicted, however, are the scale, the duration and the suffering it will cause. But one thing is clear: in an economic crisis, the burden is not shared equally. The very rich remain rich, the middle class falls into poverty and the poor into destitution.”
Part of the rivalry between China and the US
Economic analyst Alicia García Herrero outlines the geopolitical context in El País:
“In a world weakened by the 2020 - 2021 pandemic and the 2022 - 2024 inflation crisis, with high levels of public debt and fragile labour markets, this crisis could prove more devastating than the 2022 Ukraine crisis. ... The attack on Iran must be seen in the context of a rivalry between the US and China in which Washington has decided to take military action now that its economic influence is waning. ... The Trump administration appears to be trying to prevent China from obtaining cheap energy. ... The resolution of the conflict will be decisive in the battle between the US and China.”
Russian oil needed to fill the gaps
La Stampa explains why Trump has eased oil sanctions against Moscow:
“The US decision to allow the sale of Russian oil blocked at sea is creating new strategic tensions. To mitigate the energy shock caused by the Hormuz crisis, Washington is reducing economic pressure on Moscow. ... The Hormuz blockade is not only destabilising the oil market but could also trigger a spiral of inflation in which gas, oil, and food become sources of economic and political pressure. This explains the US decision. The priority is to avoid a global energy shock.”
The longer this continues, the worse the impact
Energy expert Boyan Rashev assesses the consequences for the global economy in Trud:
“Two more weeks of the Hormuz Strait blockade will push oil prices up to 160 dollars per barrel and keep prices high until the end of the year. ... A two-month blockade will lead to a genuine global fuel shortage, as many countries will simply halt exports and hold everything back for domestic consumption. Those without their own oil wells or refineries would suffer greatly. After three months we'd see a severe global recession, coupled with high inflation, as the commercial and government reserves of most importing countries would be practically depleted. Beyond three months we'll be facing a scenario like the next instalment of Mad Max.”