The Economic Consequences Of Iran Closing The Strait Of Hormuz

Seminar paper from the year 2020 in the subject Economics - Macro-economics, general, grade: 4.5, University of Luzern, language: English, abstract: With my paper, I will illustrate the economic importance of the Strait of Hormuz for the world while giving a short update on the current political situation. Nevertheless, I will keep the focus on possible consequences of Iran closing the Strait, be it on an international or Iranian level. This analysis will be carried out based on recent research. Additionally, similar situations which occurred in the past, namely the conflict between the US and Iran in 1988, which culminated in “Operation Praying Mantis”, can be used to predict the consequences of the closure of the Strait of Hormuz nowadays. Further on, I will construct two scenarios: one of further escalation and another one of de-escalation. Three indicators, that is the development of the price of Brent crude oil, numbers depicting Iranian GDP growth, and the Consumer Price Index will allow me to deliver a prognosis, on what effects each one of these scenarios might have for Iran as well as the global economy. The hypothesis, which is going to be reviewed in the conclusion of this paper, is the following: “A closure of the Strait of Hormuz would have serious consequences for the global economy.”

Choice Outstanding Academic Title 2014 Scores of books have been written by Western experts, mainly American, looking at the root causes of the conflict between Iran and the US. However, none of them have presented an inside look at this complex relationship from within the Iranian culture, society, and most importantly, the Iranian policy-making system. This gap has been the cause of misperceptions, misanalyses, and conflict, followed by the adoption of US policies that have failed to achieve their objectives. Seyed Hossein Mousavian worked for over 30 years on diplomatic efforts between Iran and the West, serving in numerous official posts, and as a confidante, colleague, and peer to many former and current high ranking Iranian officials, including now-President Hassan Rouhani and Iranian Foreign Minister Javad Zarif. Here the former diplomat gives an insider's history of the troubled relationship between Iran and the US. His unique firsthand perspective blends memoir, analysis, and never before seen details of the many near misses in the quest for rapprochement. With so much at stake, the book concludes with a roadmap for peace that both nations so desperately need.

The United States faces major challenges in dealing with Iran, the threat of terrorism, and the tide of political instability in the Arabian Peninsula. The presence of some of the world’s largest reserves of oil and natural gas, vital shipping lanes, and Shia populations throughout the region have made the peninsula the focal point of US and Iranian strategic competition. Moreover, large youth populations, high unemployment rates, and political systems with highly centralized power bases have posed other economic, political, and security challenges that the Gulf states must address and that the United States must take into consideration when forming strategy and policy.

This book outlines the state of play in maritime security in the Gulf and provides a historical perspective to current issues while also surveying different mechanisms for Gulf maritime security, both at the collective and individual state levels. The book addresses a number of questions related to maritime security in the Gulf States, such as what are the main threats facing maritime security? Do the Arab Gulf States have the necessary naval capabilities to confront these maritime security threats? What are the efforts that the Arab Gulf States have made in order to maintain their maritime security? What are the regional frameworks through which the Arab Gulf States can address maritime security threats? And what are the obstacles hindering the Arab Gulf States’ efforts to maintain maritime security? This book would be a valuable read for Gulf Cooperation Council States, the ministries of defense in the Arabian Gulf countries, security institutions, the Arabian Gulf countries’ military academies, thinks tanks and universities in the six Gulf States, Western think thanks concerned with the Arabian Gulf region, and scholars specializing in Arabian Gulf countries.

War With Iran: Political, Military and Economic Consequences provides readers both a history of Iran's relationship with the West and an expert's estimation of what the political, human and financial costs of full-scale war with Iran might be. Authors Geoffrey Kemp and John Allen Gay of the Center for the National Interest utilize their years studying and informing America's foreign policy in the Middle East to bring to life the possible outcomes of an American military intervention in Iran. Such a decision would not only have catastrophic consequences on the Persian Gulf, but would also endanger the whole world's delicate economy by heightening instability in a fragile but resource-rich region. Written for anyone with an interest in the future of American foreign policy, War With Iran explores what every player has at stake in the current crisis by analyzing every tension adjacent to it; from America's staunch support of Israel to Iran's own dogged pursuit of advanced nuclear capabilities. Controversial, timely and thoroughly researched, this story stands as a preliminary caution against what would be a devastating meltdown of diplomacy, for which--if peace be the goal--there is always time.

The 2013-14 Strategic Asia volume examines the role of nuclear weapons in the grand strategies of key Asian states and assesses the impact of these capabilities—both established and latent—on regional and international stability. In each chapter, a leading expert explores the historical, strategic, and political factors that drive a country's calculations vis-a-vis nuclear weapons and draws implications for American interests.

The Arabian Gulf is now involved in a massive arms race, triggered largely by the fear that Iran will try to use its military forces to intimidate or dominate its neighbors. Iran has threatened to close the Gulf and carried out a wide range of large military exercises to show its capabilities. And Iran has steadily increased its ability to exploit the threat of conventional and asymmetric warfare to maritime traffic in the Gulf. The buildup of Iran’s naval, air, and missile capabilities poses a wide range of threats to maritime traffic into and outside of the Gulf.