Closure of Strait of Hormuz unlikely, could severely hurt Iran.
Action needed as inflation, unrest feared amid crisis: Mian Zahid Hussain
Staff Report
ISLAMABAD:The Chairman of National Business Group Pakistan, the President of the Pakistan Businessmen and Intellectuals Forum, the President of All Karachi Industrial Alliance, the Chairman of the FPCCI Advisory Board, and the President and former provincial minister, Mian Zahid Hussain, said on Monday that any policy aimed at cornering Iran could devastate the global economic system.
He said that attacks on Iran will not remain confined to the region but will shake economies worldwide, disrupt energy supply chains, and destabilize global markets. This includes major global powers like the US and China, whose economies are heavily dependent on stable energy prices.
Mian Zahid Hussain said that if Iran is pushed too far, its only primary strategic response may be the closure of the Strait of Hormuz. Should that happen, the world would face a severe economic crisis. However, Iran itself would suffer even greater financial damage, including potential isolation from the global community and severe economic hardship.
Talking to the business community, the veteran business leader said that the international community would not support any attempt by Iran to block this vital waterway. Moreover, such a move would give the US and Israel a pretext for naval attacks on Iran, further destabilizing the country both economically and militarily.
Therefore, he said, Iranian leadership must adopt a policy based on ground realities rather than emotional responses. Iran’s options are now minimal. It must be realized that the Strait of Hormuz is not just a waterway; it is the heart of global energy flow.
Around 20 million barrels of oil, nearly one-fifth of global demand, pass through it daily, along with massive quantities of natural gas. Any Iranian attempt to block the passage would lead to an unprecedented rise in energy prices, resulting in a global backlash and severe consequences for Iran itself.
He noted that major economies, such as China, India, Japan, and South Korea, heavily rely on this route. Any disruption in oil supply would have a severe impact on their industrial production, electricity availability, and economic stability. Although some oil-producing countries have built alternative pipelines, they remain insufficient.
Mian Zahid Hussain warned that if Iran proceeds with closing the Strait, it will affect not only oil flows but also global maritime trade. This could drastically increase oil import costs, delay supply chains, create shortages of raw materials and food, and fuel political unrest in developing nations, potentially leading to widespread social and economic instability.
With the world economy already grappling with inflation, disrupted supply chains, and interest rate volatility, a surge in energy prices could trigger a new wave of global recession, a scenario we must all strive to prevent.
He urged global powers to address the deteriorating situation to prevent a full-scale crisis immediately. He said Iran must be provided with a face-saving solution, and its right to survival must be recognized.
Given the current global tensions, Mian Zahid Hussain advises Pakistan to adopt an extremely cautious, neutral, and balanced policy. This is not just a recommendation but a necessity in the face of potential crises.
He recommended securing oil supplies through alternative overland routes, boosting domestic production, and adopting energy-saving measures. He also proposed that the government should consult industry and trade bodies, chambers of commerce, and energy experts to formulate a joint strategy for effectively managing the crisis.
