US-Israel war on Iran escalates, impacting global oil supplies

Nearly two months into the US-Israel war on Iran, the conflict has resulted in significant casualties and disrupted major energy flows. The Strait of Hormuz, a vital chokepoint for approximately 20 percent of the world’s oil supplies, has faced repeated threats of closure from both Iran and the US. The situation has heightened tensions in the region, with Iran utilizing Shahed drones to target Israel and Gulf countries, while the US has launched military operations under the codename 'Epic Fury' since February 28.

The ongoing conflict has shifted the balance of power in the region, with Iran demonstrating its capability to disrupt global oil supplies through strategic military actions. The US and Israel, while attempting to maintain control over the Strait of Hormuz, face the challenge of countering Iran's low-cost drone warfare, which complicates their military strategy. This dynamic creates leverage for Iran, as it can threaten critical maritime routes that are essential for global trade and energy security.

What to watch: The international community's response to potential further escalations in the Strait of Hormuz will be crucial in determining the future of energy markets and regional stability.