As the Middle East conflict intensifies, Shell Plc SHELL CEO Wael Sawan warns of potential repercussions on global trade, particularly if the U.S. gets involved.
What Happened: Sawan, during Japan Energy Summit and Exhibition 2025, expressed concern over the escalating conflict between Israel and Iran, stating it could have a “huge impact on global trade.” Shell, a leading global trader of oil and natural gas, has already devised contingency plans to counter any potential disruption in the region’s oil flow due to the conflict, reported by Energy Connects.
Sawan highlighted the strategic importance of the Strait of Hormuz, a major artery for the world’s oil trade, at an energy conference in Tokyo. He warned that a blockade in the Strait could send shockwaves in the energy market. The CEO noted that 20% of the world oil supply comes through Hormuz and finding an “alternative” would be challenging.
“If that artery is blocked, for whatever reason, it has a huge impact on global trade… We have plans in the eventuality that things deteriorate,” said Sawan as per Guardian.
He also expressed concern about potential “jamming” or disruption of navigation signals in and around the Persian Gulf.
Sawan expressed his opinion on the changing world order and its impact on the energy markets. “We need to set actions for a new reality."
Meanwhile, U.S. President Donald Trump has suggested that the U.S. could intervene in the air war between Israel and Iran. This development further intensifies the potential impact of the conflict on global trade.
SEE ALSO: Trump Greenlights Iran Attack Plans, Awaits Tehran’s Next Move For Final Order: Report
Why It Matters: The Israel-Iran conflict has been escalating, with both countries engaging in military actions. This conflict has the potential to disrupt the global oil market, impacting not only oil prices but also global trade and economies.
Earlier this month, analysts suggested that the Israel-Iran conflict could lead to increased volatility in crude oil prices, benefiting companies like Shell. This prediction aligns with Sawan’s warning about the potential impact of the conflict on global trade, further emphasizing the significance of the situation.
Shell has been actively involved in the oil and gas industry, recently expanding its Nigerian deepwater assets through a strategic acquisition. The company’s stock performance is closely linked to global oil market dynamics, making the Israel-Iran conflict a critical factor for investors to monitor.
Brent crude oil prices have climbed 8.72% over the past five days amid escalating conflict.
On a year-to-date basis, shares of Shell surged 14.10%, as per data from Benzinga Pro.
Image via Shutterstock
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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