Office fears strait's closure could disrupt shipments

The possible closure of the Strait of Hormuz could increase transport costs and freight rates for Thailand, while also affecting inflation and exports to the Middle East, says the Trade Policy and Strategy Office (TPSO).

- PHUSADEE ARUNMAS

Poonpong Naiyanapakorn, director-general of the TPSO, said if Iran decides to close the strait, it would disrupt oil transport.

Oil tankers would have to use alter-native routes such as sailing around Africa, which would drive up energy prices and inflation worldwide, he said.

Last year, about 20 million bar-rels of oil were shipped daily through the strait, accounting for 25% of the global maritime oil trade and 20% of global liquefied petroleum gas (LPG) consumption.

The strait is crucial for shipping oil and natural gas exports from Saudi Arabia, the United Arab Emirates (UAE), Iran, Qatar, Bahrain and Kuwait.