The Middle Eastern military action may prove inflationary because of disruptions to trade routes. Iran sits along both the Persian Gulf and the Gulf of Oman, and most notably, the narrower stretch of the Strait of Hormuz, which links the two. Oil from Kuwait, Qatar, Saudi Arabia, and the UAE needs to pass through the Strait of Hormuz to be exported around the world—some 20 million barrels a day, according to figures from 2024.
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