A blustering Iran yesterday threatened to choke the flow of oil through the Gulf's Strait of Hormuz if the West imposes sanctions on its oil exports—sanctions that the the White House is prepping and the EU is considering as a way to punish the country for its nuclear work. Closing the Strait would affect the transport of about 20% of the planet's oil supply. Doing so "for Iran's armed forces ... will be easier than drinking a glass of water," declared Iran's navy chief, reports Reuters.
The four-mile-wide shipping channel between Oman and Iran sees the passage of most of the crude coming from Saudi Arabia, the UAE, Kuwait, and Iraq, as well as Iran. Reuters notes that some analysts believe there's no bite to Iran's bark, as it would take a huge economic hit and risk its relationships in the region. "It would be a suicidal act," says one analyst. "Even its friends would be its enemies." The New York Times reports that there will be no word on the threat from President Obama, a silence designed to quash the number of angry exchanges, which both satisfy Iran and roil the markets. Oil prices did indeed spike yesterday on the news. (Read more Strait of Hormuz stories.)