SAN DIEGO (KGTV) — The United States has begun a blockade on the Strait of Hormuz, stopping maritime traffic in and out of Iranian ports and sending shockwaves through global markets.
The action comes after Iran enacted its own blockade that only allowed Iranian oil to pass through the Strait of Hormuz, which is one of the most critical routes in the world for the global oil supply.
Experts in San Diego warn the impacts will be felt far beyond the Middle East, affecting nearly every part of daily life through rising gas prices and higher costs on everyday goods.
"Unless this pressures Iran to open up the Strait to everybody, it could make the oil situation worse," Alan Gin said.
Gin is an economics professor at the University of San Diego.
"Iran produces about 3.5 percent of the world's oil production, and that could have a significant impact on the oil market," Gin said.
The most visible effect will be felt at the gas pump. Gin noted that when the oil supply is disrupted, prices tend to spike quickly. However, San Diegans are expected to see impacts beyond fuel costs.
"If diesel prices are going up, that’s going to build into the price of products; in fact, all products that are shipped into San Diego. So, we might see higher food prices, we might see higher prices then for retail products," Gin said.
There are currently no signs indicating when the blockades will be lifted. Even when they are, long-term impacts will remain.
"It’s going to take a while for things to get back to normal, and we may never see the prices of oil reach where they previously were before this conflict broke out," Gin said.
Economic experts note that rising energy prices can contribute to inflation, and people should be aware that it could take time for prices to decrease.
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