Iran Decides to Blockade Strait of Hormuz... STX Green Logis Surges Over 16%

On June 23, the Iranian parliament decided to blockade the Strait of Hormuz, a key global oil shipping route, causing shipping stocks to surge.

As of 9:30 a.m. on this day, STX Green Logis was trading at 11,790 won, up 1,680 won (16.62%) from the previous trading day. Other shipping-related stocks were also rising, including Heung-A Shipping (15.74%), Korea Line Corporation (8.98%), HMM (2.39%), and Pan Ocean (2.05%).

This surge is due to the potential for increased shipping rates. Previously, on June 22 (local time), the Iranian parliament voted to blockade the Strait of Hormuz in response to the U.S. bombing of its nuclear facilities.

As the United States attacked Iran's nuclear facilities and directly intervened in the war between Israel and Iran, concerns that Iran would move to blockade the Strait of Hormuz?a key global oil shipping route and a strategic chokepoint?are becoming increasingly likely.

The Strait of Hormuz has relatively shallow waters, with limited sea lanes for large oil tankers, most of which must pass through Iranian territorial waters. This means Iran effectively controls the strait.

The Strait of Hormuz is the only sea route connecting the Persian Gulf to the open ocean, and 20% of the world's seaborne oil shipments pass through it. The market expects that if the strait is actually blockaded, oil prices could soar to over $100 per barrel.