Iran's new threat could be a death blow for world trade

TT

Published 13.03

          

         The Iran-backed Houthi rebels have the capacity to scare trade flows, according to Middle East                   expert Alexander Atarodi. On Friday, people gathered in the capital Sanaa to demonstrate against               the US war in Iran. Photo: Osamah Abdulrahman/AP/TT

Iran's hint that it will also close the Bab el-Mandeb Strait could have major consequences for world trade and lead to inflation in Sweden, according to Middle East expert Alexander Atarodi.

- It will affect all goods from Clas Ohlson and Jysk, and from what do I know, he says.

The Speaker of the Iranian Parliament, Mohammad Bagher Ghalibaf, published a post on X late on Friday in which he indirectly threatens to close the Bab el-Mandeb – a strait that is a waterway for the world's freight traffic, mainly between Asia and Europe.

Before 2024, when the first round of disruptions occurred in connection with the Gaza war, around 50 percent of China's exports to the EU went via the strait, says Alexander Atarodi.

"Must be taken seriously"

If the strait were to be closed, the transport route would be affected and then prices would be indirectly affected, which would lead to inflation, he says.

- Europe, China and Asia trade a colossal amount, so just a small fraction of an increase in prices could mean higher inflation throughout Europe.

So far, Iran's statement is still only a hint of a threat, but according to Atarodi, it is a threat that must be taken seriously.

- Iran has shown that it has the capacity to close the Strait of Hormuz. This has given Iran a strategic advantage, and a changed security policy structure where they have considered how to further put pressure on the world economy and the West.

The impact of the Houthi movement

The Iran-backed Houthi rebels in Yemen have since the end of March entered the Iran war, after sending several missiles and drones against Israel.

In March last year, the US carried out a series of airstrikes against targets belonging to the Houthi movement, which was a severe blow to the rebels' military capacity. But with the latest attacks against Israel, the Houthis have shown that they have the ability, says Atarodi.

- Even if they do not have the same capacity to close the Bab el Mandeb Strait as Iran has been able to do with the Strait of Hormuz, it is enough to scare trade flows, ships and companies.