Has the Iran war changed fuel forever?
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What is the main topic discussed in this episode?
ABC Listen, podcasts, radio, news, music and more. Hi, I'm Patricia Carvellis, the host of Politics Now. And sometimes it can be hard to cut through all the noise from the Canberra bubble. But on the Politics Now podcast, bursting it wide open is our core business. I'm joined by the brightest minds at the ABC to break down the polyspeak and have a chat about what's actually going on behind the scenes. It's called Politics Now and you can find it on ABC Listener.
Before the war, it was open, safe and toll-free. Now, the Strait of Hormuz has become one of the biggest problems for Donald Trump as he tries to end the conflict. While the global oil supply has been disrupted for months, petrol prices here are now as low as they were before the war began. Today, energy analyst Kevin Morrison on whether that can last. I'm Sam Hawley on Gadigal land in Sydney. This is ABC News Daily.
Kevin, Donald Trump, when the prospect of a deal with Iran first emerged, he told the ships of the world to start your engines and let the oil flow. But clearly it's not really that easy, is it?
No, no. And there still seems to be a lot of nervousness around because despite what Donald Trump has said, the Iranians have said that the Strait of Hormuz is actually closed. There's sort of conflicting accounts of what's really going on.
The initial US-Iran deal, which includes an end to the fighting in Lebanon, appears on the cusp of unravelling. Tehran once again declaring the Strait of Hormuz closed, even as Washington insists it's still open.
Our country's doing so well. Those ships are flowing out of the Hormuz Strait like nobody's ever seen before, actually. There were a lot of them, about 700 of them, and they're pouring out. The oil is all over the place.
The US has said that the ships have passed carrying about 17 million barrels of oil. So that's almost back to where we were before the conflict, which was around 20 million barrels a day.
So when Jaddy Vance, he flew off to Switzerland on the weekend for these talks with Iran, which didn't actually go that well, the Iranians, as you say, they had declared that they had closed the Strait of Hormuz again in response to Israeli attacks against Hezbollah in Lebanon. The Americans then contradicted them and said it was still open.
The opening of the Strait of Hormuz, the ending of the Iranian nuclear program, all of these things have already been accomplished. The question before us now is how much more can we accomplish together?
But it's just this huge uncertainty. It must be incredibly confusing for the shipping companies.
Yeah, absolutely. The shipping companies and then in turn the insurers and also the oil consumers, i.e. being the refineries, particularly in the Asia-Pacific region. So nobody quite knows what is going on. It is a very, very nervy time. The insurance companies, they've said they're still treating it as a conflict zone. And so, you know, it's not back to what they would consider a normal state of business.
Yeah, well, Donald Trump, according to a quote from Fox News, he's warned Iran if it closes the strait, you won't have a country so threatening to restart the bombing again. Now, as you say, there has been some ships getting through, though, we think. The US military says 55 ships travelled through the strait on Saturday alone. That is less than normal, but as you say, it looks like it's ramping up again.
Yeah, because before the conflict, it was around 90 vessels a day that traveled through the strait. So that's around 3,000 a month. So obviously, it's a very busy waterway. So we're seeing this initial rush.
What challenges has the Strait of Hormuz faced since the Iran war began?
But what's going to take time is all those hundreds of ships that have been waiting outside the strait around the Sea of Oman to get in, to load up, because... That whole production supply chain does take a long time in getting back because they've had to shut in oil fields, they've had to shut in gas fields, and you simply just can't flick a switch and expect them to turn back on immediately. So that all takes days and weeks before that whole process starts.
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Chapters
4 chapters
1
What is the main topic discussed in this episode?
0:00–4:20
2
What challenges has the Strait of Hormuz faced since the Iran war began?
4:20–5:39
3
How have global oil supplies and petrol prices been affected by the conflict?
5:39–9:55
4
What conflicting reports exist about the status of the Strait of Hormuz?
9:55–15:57