Oil prices spiked this week on false rumours that Iran had closed a strategically important waterway in the Persian Gulf

The aircraft carrier USS George Bush transitst hrough the Strait of Hormuz

On Tuesday 13th December false rumours began circulating that Iran had closed the Strait of Hormuz, a narrow, strategically important waterway between the Gulf of Oman and the Persian Gulf.

The news spread rapidly and caused massive price rises in the oil market. It is believed that the rumours were sparked by an announcement from the Iranian government on December 13 which suggested, ambiguously that Iran would “hold a military manoeuvre on how to close the Strait of Hormuz—without stating that it actually intended to do so.

In light of these events, Exclusive Analysis’ head of intelligence Gary Li explained how such an event could actually play out. “If Iran did attempt to close the strait, this would be an aggressive act contravening international law and would inevitably bring the US 5th fleet which is based in the region into conflict with Iran, which is why it is held as a last resort scenario in time of war.”

Li went on to explain how the rumours could have started: “Some industry sources claimed that an explosion was heard in the general area, but this could be attributed to the Velayat 90 naval exercises which was announced in late November. The exercises are thought to involve a whole variety of naval and air assets as well as life firing exercises. However Iran had stressed that the exercises will take place in international waters and would not endanger any shipping.”