Iran-Israel Ceasefire in Doubt as Global Oil Faces Disruption
With the crude oil prices rising, the ceasefire between Iran and Israel is in doubt. The prices have seen a 0.36% hike.
International News: A ceasefire was confirmed between Iran and Israel on June 24, 2025. The 12-day-long conflict concluded post-mediation by U.S. President Donald Trump. However, Iran remains doubtful of Israel's intention of honoring the ceasefire. "There is deep suspicion regarding the enemy’s intentions to maintain the ceasefire and honor its commitment", Iran’s Armed Forces Chief Abdolrahim Mousavi said as quoted by Fars, Iran’s semi-government news agency. In case of any attack, Iran is prepared to retaliate, he added.
Impact on Crude Oil Prices
Amid the ongoing tension between the two Middle- Eastern Nations, the crude oil prices have increased by 0.36%. The term "Black Gold" is used to emphasize the growing strategic importance of Crude oil.Fears persist that if the conflict resumes and Iran Blocks the Strait of Hormuz, it could disrupt the global crude oil supply chain. This would push the Brent Crude oil prices higher.
Importance Of Strait of Hormuz
In the world's oil supply system, The Strait of Hormuz is one of the most important points. It is especially fragile as 25% of the Global Oil passes through this narrow strip between Iran and Oman. Experts say that this area can easily be blocked using mines, missiles, and small fast boats. If Iran blocks the strait, the prices could rise up to several hundred dollars per barrel. This could cause a fast increase in prices and possibly lead to a global economic crisis.
Impact of the Strait Shutdown
The shutdown of the Strait would lead to oil tankers taking a longer, more expensive route around the Arabian Peninsula. The U.S. Navy's Fifth Fleet is always present nearby due to this strategic importance. Mousavi had a call with Saudi Defence Minister Khalid Bin Salim during which the ceasefire was discussed, as reported by Bloomberg. The news of the ceasefire broke just hours after U.S. President Donald Trump announced it on Truth Social.
The Iran-Israel conflict began on June 13, triggered by an Israeli strike that resulted in the deaths of multiple high-ranking Iranian military officials and scientists.Mousavi’s predecessor, Chief Mohammad Bagheri, was also a casualty of Israeli assaults.
