GLOBAL TRADE AT RISK: ASSESSING THE IMPACT OF THE U.S.–IRAN CONFLICT

Abstract

The U.S.-Iranian conflict has become one of the most significant geopolitical conflicts affecting global trade, energy markets, and international economic relations. The current research aimed to investigate the impact of the conflict on the stability of global trade, particularly through economic sanctions, oil market volatility, maritime security, and, above all, supply chain disruptions. Secondary data sources, such as academic literature, policy reports, international trade organizations, and economic analyses, were collected using a qualitative analytical research design. The study investigated the legal consequences of U.S. sanctions on Iran, as well as their effects on international trade and commerce. Results indicated that the conflict's effect in reducing oil market instability was the most significant, with an index rating of 8. 8.9 on a scale of 0 to 10, followed by maritime security threats (index rating of 8.3. 3), and finally trade uncertainties (index rating of 8.1. 1). Economic sanctions had significant impacts on Iran's economy, including loss of oil revenue (9.1. 1) and restrictions in the banking sector (8. 8.8), leading to reduced foreign investment, currency devaluation, and inflation. The analysis also revealed a strong association between geopolitical crises and the oil market volatility index, which rose from 48 to 96 as the crisis escalated. Shipping safety in the Strait of Hormuz led to higher shipping costs, insurance premiums, and logistical delays, ultimately affecting the efficiency of global shipping. The research results reveal that the U.S.-Iran conflict is a multifaceted issue that could affect the stability of global commerce. The regional repercussions of the conflict are compounded by concerns about investor confidence, international energy security, and effective multilateral energy governance. The findings underscore the importance of diplomatic engagement, increased multilateral cooperation, and greater use of multilateral tools to mitigate geopolitical risks and make the global trading system more resilient.