US–Iran Conflict Wounds Global Business by IDR 400 Trillion
The global business community has been hurt by the conflict involving the United States, Israel, and Iran to the tune of $25 billion, or around IDR 400 trillion, according to Reuters. The figure is expected to rise further.
Reuters analysed statements from hundreds of companies since the conflict began. The results showed that 279 firms cited the conflict as the reason for defensive actions. Some raised prices and cut production, while others suspended dividend payments, froze share buybacks, laid off workers, or passed higher fuel costs on to customers.
Pressure intensified after President Donald Trump again warned Iran at the weekend. Drone strikes on the UAE and Saudi Arabia further clouded the situation. In the UAE, a drone damaged a generator at a nuclear power plant. Saudi Arabia said it had intercepted three drones launched from Iraqi airspace.
Energy markets reacted immediately. Citing OilPrice.com, Brent crude rose above $111 per barrel, while West Texas Intermediate traded above $107 per barrel. Fears of supply shortages continued to mount. More than 10 million barrels per day of Middle Eastern production are now offline, and dwindling inventories must be replenished promptly.
ING commodity analysts noted increased tanker activity in the Strait of Hormuz. Iran reported that 30 ships were allowed to transit over two days last week. However, ING warned the situation “could change rapidly.”
Diplomatically, the summit between Trump and Xi Jinping in Beijing did not deliver the results hoped. Rather than easing the crisis, the talks underscored how limited the two powers’ ability to resolve the Iran conflict and re-open the Strait of Hormuz.
From OilPrice.com, Trump returned home claiming that “many issues” had been resolved and that Xi had agreed the Strait of Hormuz “must remain open.” Yet no concrete outcomes were presented—no framework, road map, or joint initiative. No maritime security pact. No diplomatic breakthrough with Tehran. No energy-stabilisation agreement.
Trump’s claims were quickly denied. Chinese officials rejected or ignored Xi’s offer of assistance. The gulf between the two nations, it appears, means there is no strategic alignment. Washington wants Beijing to pressure Tehran harder; Beijing seeks stability without jeopardising its ties with Iran. The result is a stalemate.
Oil markets grew jittery once more as the Beijing meeting’s apparent optimism proved illusory. Crude prices rose again and the tanker market remained volatile. The Strait of Hormuz is no longer facing temporary disruption but a palpable, lasting instability.
The so-called ‘Operation Freedom’ naval escort initiative was also deemed a failure. Shipowners and insurers lack confidence in American security guarantees. The uncomfortable truth is that the US can still deploy military power in the Gulf, but cannot restore confidence in commercial markets.
Iran has even established the Persian Gulf Strait Authority, a new body that openly governs who may pass through Hormuz. Vessels linked to China are reported to be allowed to transit, while others are not. If this continues, energy flows and global maritime insurance will be determined not by free markets but by political ties.
The Beijing discussions also touched on Taiwan. Xi warned that mismanaging the situation could trigger “a clash, even a conflict.” The world faces not a single crisis but threats spreading simultaneously in the Strait of Hormuz, the Red Sea, and East Asia. Europe, too, appears unprepared, caught between its reliance on the US and its need for Gulf energy, lacking a clear maritime strategy of its own.