Iran-Israel Conflict Raises Export Concerns But Freight Stable Via Strait Of Hormuz: Chaman Lal Setia Exports

"We haven't faced any impact over the Strait of Hormuz as of yet," said Rajeev Setia, Joint Managing Director of Chaman Lal Setia Exports Ltd., amid escalating tensions between Iran and Israel. "I have not heard of any stoppage of cargo going through that route yet," he told NDTV Profit.

As the military standoff between Israel and Iran intensifies, global concern is mounting over reports that Tehran may consider closing the Strait of Hormuz.

Esmail Kousari, a member of Iran’s parliamentary security commission, was recently quoted in local media saying the government is “seriously reviewing the closure of the Strait of Hormuz.”

Nearly 20 million barrels of crude oil and a third of the world’s liquefied natural gas shipments pass through the strait daily—accounting for roughly 20% of global oil consumption, according to the U.S. Energy Information Administration.

Setia acknowledged that tensions in the Middle East are affecting the export industry. "Globally, the current situation is unprecedented. However, oil prices are still below the four-year average," he noted.

"Amid the Iran-Israel conflict, the industry is taking a hit, as many shipments and vessels use the Strait of Hormuz—which could potentially be disrupted," he added.

Chaman Lal Setia Exports does not export to Iran. "We stopped exporting to Iran about 20 years ago due to sanctions and other issues," Setia explained.

"We cannot deny that the Iran-Israel conflict has had a catastrophic impact. A lot of goods belonging to my fellow exporters are stuck at the ports there, and that has affected prices,” he said.

Setia said that it’s too early to comment on the full price impact. "So far, ocean freight rates haven’t increased, but we never know when they might,” he said.