"This is potentially the most serious production disruption we have had for the international energy and oil market," says Robert Bergqvist, Senior Economist at SEB.
Traffic through the strategically important Strait of Hormuz has been effectively stopped by Iran since the US and Israel attacked Iran on February 28. A majority of oil and gas shipments usually travel east towards Asia, but are not arriving.
"The whole world is affected, but Asia is most vulnerable," says Robert Bergqvist.
Pakistan and Vietnam have urged civil servants to work from home to reduce their commute and save energy, while the Thai government has also ordered civil servants to cancel overseas travel and use stairs instead of elevators.
"We will try to reduce our consumption as much as possible and think about what we should use the energy for," says Bergqvist.
Huge amounts
André Månberger, a researcher in energy systems at Lund University, says that "absolutely enormous amounts of energy" are affected by the stoppage in the Strait of Hormuz.
"If this were to continue for a long time, it would be a significantly greater change in society than what we saw during the Covid pandemic in terms of the need to shut down transportation and the like."
In addition, concerns are rising in the semiconductor industry, as the blockade in the strait is choking off supplies of important input goods and energy to Taiwan, which produces 90 percent of the world's most advanced chips, writes Bloomberg.
“Is there a pain threshold?”
However, several experts believe that the situation will improve in the near future.
"There is indeed a risk of an energy disaster. But at the moment it is not something that the market believes will last long," says André Månberger.
Robert Bergqvist believes that the world is moving towards a new global energy crisis, but that it is too early to say whether this will be the case.
"We don't know where this is going to go. My conclusion is that there is a political and economic pain threshold - even military - that these parties will hit sooner or later."
