"I liken global supply chain linkages to financial linkages around the world. You can see some direct links, but there are these indirect links you can't necessarily see or predict. One small ripple in one place turns into a tidal wave elsewhere."
"Shipping costs can ripple across the globe and put upward pressure on costs, even for goods that are not going through the Strait of Hormuz."
Iran has threatened to attack commercial vessels in the Strait of Hormuz and has launched drone strikes that disabled Qatar's liquefied natural gas production for export. Simultaneously, Houthi rebels have forced container ship traffic through the Suez Canal to reroute around Africa. While these disruptions directly impact Europe, Japan, and South Korea more severely than the U.S., global markets remain interconnected. Higher oil and natural gas prices worldwide and impaired production of imported goods will increase costs for Americans. Global supply chains already under strain face additional pressure from these geopolitical conflicts, with shipping cost increases affecting goods globally regardless of their route.
Read at Axios
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