Strait of Hormuz is heating up again, Airlangga: Government monitors the movement of world oil prices
JAKARTA - Coordinating Minister for Economic Affairs Airlangga Hartarto stated that the government continues to monitor the development of world crude oil prices following the renewed escalation of tensions between the United States (US) and Iran, including the impact of the closure of the Strait of Hormuz which is the main route for global energy distribution.
According to Airlangga, the movement of oil prices is still very volatile, after having weakened along with the easing of the conflict, oil prices have again increased due to increased geopolitical uncertainty.
"Yes, we just monitor it, every week up and down (up and down)," he told the media, Monday, July 13.
He explained that the direction of oil price movements is greatly influenced by conditions in the Strait of Hormuz, which Iran has closed again in response to attacks carried out by the United States and Israel. "Oil prices depend on the Strait (Hormuz)," he explained.
Tensions in the Middle East have again pushed up global oil prices after the United States launched a new wave of attacks against Iran.
The situation was exacerbated by the heating of the dispute between the two countries regarding the status of the Strait of Hormuz, which is a vital route for the delivery of oil and gas in the world.
Based on data from Investing, due to this development, the price of Brent crude oil reached 78.52 US dollars per barrel. Meanwhile, West Texas Intermediate (WTI) crude oil was traded close to 73.62 per barrel of US dollars.
Meanwhile, on Sunday, July 12, Iran announced the closure of the Strait of Hormuz until an unspecified deadline and the decision was taken after Iran launched retaliatory attacks using drones and missiles against a number of US bases in the Middle East, including in Jordan and Qatar.
The closure caused shipping traffic in the Strait of Hormuz, which has been a shipping route for about 20 percent of the world's crude oil and liquefied natural gas (LNG) supplies, extending the global energy distribution disruption that has occurred since the escalation of tensions in the region.