Cyprus business chamber warns Strait of Hormuz closure could raise costs and disrupt supply chains

Nicosia, Cyprus. The possible closure of the Strait of Hormuz could disrupt supply chains and commercial activity, with knock-on effects on prices, the Cyprus Chamber of Commerce and Industry (Keve) said on Monday. Secretary general Philokypros Rousounides said the main concerns would be timely deliveries and rising costs.

Supply chain and commercial impact

Speaking to the Cyprus News Agency (CNA), Rousounides said such a development would create disruptions in the supply chain and in the country’s commercial activity, pointing to delays, rising transport costs and sharply higher insurance premiums due to the war. He said it would be an additional cost and challenge for the supply chain.

Oil market pressures and wider economic effects

Rousounides said price pressures were also being fuelled by developments in the oil market, noting that crude prices had risen by 10 per cent on the day. He cited market estimates pointing to levels above 100 to 120 dollars per barrel and said such a scenario would have corresponding negative effects on the wider economy.

Calls for calm and ongoing assessment

Rousounides said Keve was monitoring developments and urged calm, saying it did not want to panic the market and partners. He added that if the war continued for several weeks, problems could emerge, and said the situation was being assessed hour by hour.

Contingency planning and alternative routes

Asked whether alternative trade routes were available in the event of shortages, Rousounides said contingency planning was under way and alternatives existed, adding that the situation would be evaluated before any options were put into effect.

How do you expect potential disruptions in shipping routes to affect prices and availability of goods in Cyprus?