In a significant escalation of tensions in the Middle East, the United States conducted strikes on three Iranian nuclear facilities over the weekend, triggering concerns about global economic stability and oil supply [1]. The targeted sites included Fordow, Natanz, and Isfahan, which were hit by B-2 bombers, bunker-buster bombs, and Tomahawk missiles [1].

In response to the U.S. action, Iran's parliament has voted to close the Strait of Hormuz, a critical waterway through which approximately 20% of the world's daily oil supply passes [1][2]. The final decision on this matter now rests with Iran's Supreme National Security Council [1].

The potential closure of the Strait of Hormuz has sent shockwaves through global markets. Natasha Kaneva, head of global commodities research at JP Morgan, warned that oil prices could spike to $120 per barrel or higher if Iran follows through with the closure [1].

As of Monday, June 23, 2025, the immediate market reaction has been volatile. Brent Crude, the European benchmark for oil prices, initially surged by more than 5%, pushing above $81 per barrel, before easing later in the day [1][4]. The U.S. strikes have also impacted other sectors, with shipping rates spiking and global stock markets taking a hit [2].

The economic fallout from this geopolitical crisis extends beyond oil markets. As Jamie McGeever, Markets Columnist for Reuters, noted, "Stocks flew, oil sank, and bond yields tumbled on Monday in a highly volatile start to the week, as traders digested Iran's response to the U.S. strikes on its nuclear sites and a string of dovish remarks from Federal Reserve officials" [3][4].

The situation remains fluid, with potential for further escalation. The Strait of Hormuz, lying entirely within the territorial waters of Iran and Oman, is a critical chokepoint for global oil supply [2]. Any attempts to close it could lead to a dramatic escalation of the conflict and have far-reaching consequences for the global economy [2].

As the world watches the unfolding events in the Middle East, economists and market analysts are closely monitoring the situation, assessing the potential long-term impacts on global trade, energy prices, and economic growth.