The Strait of Ormuz. Iran's attacks raise oil prices

The Ormuz Strait was once again in the centre of tension. Brent's oil price exceeded $14 per barrel after Iran's attacks on ships and infrastructure in the region. According to the information provided, Iran attacked ships passing through this dangerous route and infrastructure in the United Arab Emirates.

Attack on the UAE and uncertainty in the oil market

The United Arab Emirates Ministry of Defense reported the interception of 12 ballistic missiles, three maneuvering missiles and four drones launched from Iran. At the same time, in Fujiar, an important oil industry center located on the Oman Gulf, a fire was reported following the hit by an Iranian drone.

The meaning of Fujijah is special because the port lies outside the Ormuz Strait. It is this location that allows the UAE to maintain part of the oil exports without the most vulnerable sea point of the region. Each attack in this area immediately translates into a market reaction as investors begin to assess the risk of interference supply of raw material.

On Monday night, Brent's oil contracts grew by about 5%, reaching a level of $14 per barrel. The fall also ended with a session on Wall Street where Dow Jones Industrial lost 1.13%, S&P 500 fell by 0.41%, while Nasdaq Composite fell by 0.19%.

Ormuz Strait as a key oil transport route

The Strait of Ormuz remains one of the most important maritime crossings of the world economy. Ships carrying oil, gas and cargo relevant to the countries of Asia, Europe and North America pass through this narrow route. Any restriction on freedom of navigation in this area is of importance far beyond the Middle East.

According to the information provided, the U.S. Administration announced the initiative "Project Freedom", which aims to secure the passage of commercial vessels through the Strait. U.S. Navy ships, including aircraft carriers with more than 100 aircraft on board, unmanned platforms and 15,000 soldiers, are to be involved.

Yesterday CENTCOM reported Iran was about to launch maneuvering missiles in the direction American ships and merchant ships. The attack was repulsed, while Apache and Seahawk helicopters destroyed six small Iranian assault boats. Admiral Brad Cooper also reported that US forces had prepared a route free of Iranian mines for merchant ships, which had already passed the first units under the Freedom Project.

At the same time, the United Arab Emirates was under tension. An air alarm was announced in Dubai, the UAE authorities reported the interception of parts of Iran's missiles, while a fire occurred in the oil industry plant after the drone attack. UKMTO also reported a fire on a cargo ship north of Dubai; the crew did not suffer.

Washington's acute reaction

Donald Trump warned Iranian armed forces against attacking American ships in the Ormuz Strait or Persian Gulf. Previously, U.S. Central Command Commander, Admiral Bradley Cooper, reported that US forces destroyed six small Iranian boats in the Strait area.

In the evening, Danish shipowner Maersk confirmed that one of his ships had crossed the Ormuz Strait under the cover of U.S. Navy ships.

Iran denies planning an attack on Fujihra

Iranian state broadcaster IRIB, citing a military representative, reported that Iran did not plan to attack oil installations in Fujiar. According to this account, the event was to be the result of actions U.S. Navy ships, which Tehran described as an attempt to create a passage for the illegal passage of ships through the Ormuz Strait.

The UAE considered the attacks to be a serious escalation and reserved the right to react. The head of the European Commission, Ursula von der Leyen, assessed them as inadmissible and violating international law and the sovereignty of the state.

Middle Eastern Region under increasing risk pressure

The current situation shows how quickly armed action in the Gulf region translates into energy prices, maritime transport and political decisions. The Ormuz Strait remains not only a shipping route, but also a tool of pressure, the importance of which increases with each incident aimed at commercial vessels.