Strait of Hormuz Closure Sparks Global Economic Concerns

Strait of Hormuz Closure Sparks Global Economic Concerns.webp

United Nations, April 2 UN Secretary-General Antonio Guterres delivered a "clear" message to the US, Israel, and Iran on Thursday, urging them to stop the war in West Asia, warning that the world is on the "edge of a wider war".

"My message is clear. To the United States and Israel, it is high time to stop the war that is inflicting immense human suffering and is already triggering devastating economic consequences. To Iran, to stop attacking their neighbours," Guterres said in remarks to reporters here.

As the West Asia conflict entered its second month, causing economic and humanitarian hardships in the region and beyond, Guterres stressed on dialogue and diplomacy to find a peaceful resolution to the conflict.

"Conflicts do not end on their own. They end when leaders choose dialogue over destruction. That choice still exists. And it must be made – now," he said.

"We are on the edge of a wider war that would engulf the whole Middle East with dramatic impacts around the globe," the UN Chief said.

Emphasising that diplomatic efforts are underway to find a peaceful path forward, Guterres said disputes must be settled peacefully and sovereignty and territorial integrity of all Member States must be respected.

Guterres said he remains in close contact with the parties and announced that he is dispatching his Personal Envoy, French diplomat Jean Arnault, to the region to support these efforts.

Guterres had last month named Arnault as his Personal Envoy to lead United Nations efforts on the conflict in the Middle East and its consequences.

The UN Chief called for civilians and civilian infrastructure, including nuclear installations, to be respected and protected and that freedom of navigation is upheld.

He voiced concern over the growing scale of "devastation" being unleashed in the region and the world, saying "Every day this war continues, human suffering grows."

As the Strait of Hormuz, the crucial oil artery located between Oman and Iran connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea, virtually closed due to the conflict, Guterres said when this crucial chokepoint is "strangled, the world’s poorest and most vulnerable cannot breathe.

"We see it in the daily lives of people struggling with rising food and energy costs from the Philippines…to Sri Lanka…to Mozambique… to communities far beyond," Guterres said.

UN Trade and Development (UNCTAD) warned that the Strait of Hormuz, a central artery for global energy trade, has seen activity fall to a near halt. Ship transits dropped from around 130 per day in February to just six in March - a collapse of about 95 per cent.

"The disruption is hitting a large share of global oil and gas supplies, with immediate consequences for production, trade and consumption worldwide. It is also spilling over into transport systems, including maritime routes, air cargo and port logistics," UNCTAD said Wednesday.

The UN agency warned that if the military escalation and disruptions persist, the suffering will extend far beyond the region, translating into widespread economic hardship.

"At a moment of heightened fragility, de-escalation and the restoration of stability are essential," it said.

The UN agency also cautioned that soaring oil and gas prices may inflate the cost of living, squeezing the livelihoods of the most vulnerable.

Trade and growth are expected to slow in 2026 and financial ramifications for developing countries include falling stock prices, weakening currencies, and rising cost of external debt.
 
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antónio guterres conflict resolution diplomacy economic impact energy trade humanitarian crisis international conflict iran israel middle east regional stability strait of hormuz unctad united nations united states west asia conflict
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