WASHINGTON, April 7– International experts said that even if the Iran war ends, global oil prices might not return to pre-conflict levels.
U.S. President Donald Trump threatened on Monday to take out the entire country of Iran “in one night” if it failed to make a deal before the Tuesday night deadline he set for Tehran to reopen the Strait of Hormuz.
“Tuesday will be Power Plant Day, and Bridge Day, all wrapped up in one, in Iran. There will be nothing like it!!! Open the Fuckin’ Strait, you crazy bastards, or you’ll be living in Hell — JUST WATCH! Praise be to Allah,” Trump wrote on Truth Social.
Experts suggested that even if Iran agrees, the damage to energy infrastructure could take time to fully repair, with some experts estimating a length of three to five years.
Over 40 energy assets region-wide have been “severely or very severely damaged”, and it could take weeks to clear the backlog of ships and for global energy exports to recover, according to the International Energy Agency.
Even with logistics facilities running at peak levels, “it would take time to clear the backlog of oil, gas and other goods unloaded from vessels,” reported Al Jazeera, quoting Svein Ringbakken, managing director of the Norwegian Shipowners’ Mutual War Risks Association.
Ringbakken added that this has been made “even more difficult” by attacks that have damaged energy and transport infrastructure across the Middle East.
If hostilities fail to resolve and the maritime route continues to be blocked, the global oil market could be left in a fragile state, experts said. If shipping remains disrupted, that could force a structural shift in shipping and lead to higher long-term energy prices, reported the BBC.
“Even if the war ended tomorrow, it would probably take a year or so for all the production and shipping facilities to be fully restored,” Dean Baker, co-founder of the Center for Economic and Policy Research, told Xinhua.
Others have echoed such statements, estimating that the price of oil will remain high due to the conflict in Iran.
“My guess is that prices will not come back towards 60 (U.S. dollars per barrel) for several months after the war ends,” Gary Hufbauer, a nonresident senior fellow at the Peterson Institute for International Economics, told Xinhua, noting that the price of Brent crude has hovered over the mark of 100 U.S. dollars per barrel.
At the same time, Iran has started charging oil tankers for passage through the strait — in some cases as much as 2 million dollars per vessel — and its parliament has approved legislation to formalize tolls on ships transiting the waterway.
The bill to impose fees for ships traversing the key waterway was approved by the Iranian parliament’s National Security and Foreign Policy Committee, the country’s state media reported Monday.
The move is a bid to assert what Iran believes is its “sovereign role” in the waterway, according to the state-run Islamic Republic of Iran Broadcasting.
Trump said Monday that the United States, not Iran, should charge tolls on vessels passing through the Strait of Hormuz, stressing that reopening the Strait must be part of any deal to end the war with Iran.
“We have to have a deal that’s acceptable to me, and part of that deal is going to be we want free traffic of oil and everything,” the U.S. president said.
Brookings Institution Senior Fellow Michael O’Hanlon told Xinhua that he didn’t see the chance of the waterway being cleared any time soon.
Iran’s Islamic Revolutionary Guard Corps Navy has already claimed that the Strait of Hormuz has entered a “new reality” and will not return to its previous status, particularly for the United States and Israel.
Experts suggested that disrupting shipping through the strait may also hurt Iran, and Tehran will weigh the costs of economic difficulties versus security.
“There will be internal discussions in Tehran about how much economic pain to exchange for how much security leverage,” Clay Ramsay, a researcher at the Center for International and Security Studies at the University of Maryland, told Xinhua.
Meanwhile, Tehran is warning of a “more severe and expansive” response if the U.S. president follows through on his vows to attack Iran’s bridges and energy infrastructure.
Among the “many things being discussed” is a proposal for a 45-day ceasefire, NBC reported, citing a senior White House official.
This comes after Tehran rejected Washington’s proposal, focusing on the need for a definitive end to the conflict, according to news reports. (Namibia Daily News/Xinhua)
