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Spannungs flare again between Iran, Israel and the U.S. as tensions re-emerge once again from one side of their respective countries, . S. Especially on crypto social media X (or Crypto Twitter), and in the wake of news reports that Tehran could close down the Strait of Hormuz, an important oil chokepoint, which is essential to shut down. Several worry, however, that such a move could send oil prices and global inflation spiraling and roil financial markets like bitcoin.
However, those concerns may be exaggerated, according to some observers.
Israelis, and the U.S. – early Saturday as well as Early Saturday’s ). S, meanwhile. Despite the failed negotiations, Iran was subject to airstrikes by that sought to destroy its nuclear facilities and missile capabilities. Iranian response was to ballistic missiles fired against Israel and the U.S, a move that hit Iran in return for its own right. A , S. bases in the area, increasing concerns that there will be an entire-blown military conflict.
jitters in the crypto market, where investors are only allowed to express fear and risk, were generated by this as traditional markets closed over the weekend.
The price of Bitcoin BTC$64,892 is $39,9002. The most important cryptocurrency by market value, 86 (advanced to $63,000 from around $65,600) fell into the six-month low of about $65,000 and then rebounded back to $55,000. Futures of Oil-linked future on Hyperliquid surged more than 5%.
Hormuz fears
The Strait of Hormuz is a chokepoint (21 miles wide at its narrowest point) between Iran to the north and Oman to south, which allowed about 20 million barrels of oil deliveries per day in 2024 according to U.S. s S A , Energy Information Administration (EIA) is also a figure-independent energy information administration.
Despite the simmering tensions, crypto accounts on X fear that Iran will close the Strait of Hormuz, cutting off oil supplies.
It doesn’t mean only geopolitics, however, if there is a direct conflict between the United States and Iran that has started. It’s a global economic event,” . The oil could spike toward $120–$150, an X handle called @Crypto_Diet said when the Strait of Hormuz is threatened.
This could lead to an inflation shock, market sell-offs, a dollar surge, and depreciation in emerging-market currencies, the post added.
Several more accounts have posted similar views, with some savvy geopolitical experts sharing these concerns.
By the time of the strikes, oil prices had already been soaring to six-month highs ahead of these strikes,” . Geopolitical Strategist Velina Tchakarova said Iran is a founding OPEC member and the Strait of Hormuz, through which about 20% of global oil passes are now directly implicated.
Some news outlets are already reporting that a number of oil majors, including trading houses, have suspended oil and fuel deliveries through the strait on top of that.
Outright closure unlikely
Some observers argued that an outright closure of the strait is not in Iran’s best interests and may be geographically impossible, but could have been “a bit of a distant dream” for some observers.
Daniel Lacalle, PhD economist, fund manager and chief economist at Tressis said Iran now produces 3. The oil exports only half of that, nearly all going to its ally China (administering 3 million barrels per day), but just over half the amount is exported.
“It would shoot itself in the foot,” Lacalle said, downplaying fears of an eventual Iranian shutdown of the strait.
His comments were that OPEC members could quickly offset any disruption to oil supplies from Iran; “The United States, by itself, is the world’s largest oil producer,” he said.
In other words, any spike in oil prices could be measured and temporary.
It is Geography that should be the other thing to look at, as does . The shipping lanes are mostly located in Omani waters, while the strait is roughly divided between Iran and Oman. Water on the Iranian side is said to be shallower, while it is deeper and better suited for moving large oil tankers on Omani side.
So, technically, ships could pass through Oman’s yard; thus Iran’ extinction of its territory may not have much effect on supplies.
“Most waterways are in Oman, not Iran,” Energy Market Expert Dr. Anas Alhajji said on X.
“Hormuz strait has never been blocked despite all wars – It cannot be blocked. Too wide. Well protected,” he added.
The odds of Iran closing the strait and cutting off oil supplies are low, all things considered. But an all out war, that said, can still cause widespread risk aversion — driving bitcoin below the popular $60,000 support level and possibly even behind it is “the most widely watched” (e.g.
Meanwhile, bitcoin’s price chart also signals a potential for deepening of the bear market ahead amid the Middle East crisis.
Thanks for reading Crypto community fear of Iran choking oil supply and crashing markets may be overblown
