Kevin O’Leary, chairman of O’Leary Ventures and "Shark Tank" star, stated that removing Iran’s control of the Strait of Hormuz would be a global "game changer" with significant economic benefits. Speaking on "The Story," O’Leary emphasized the positive long-term impact of stabilizing this critical trade route, which sees 20% of the world’s crude oil and natural gas pass through.
The Economic Impact of Iranian Control
O’Leary highlighted how Iranian proxies have historically destabilized the region, citing examples of tanker attacks that drove up insurance costs. "Every nine months, the Houthis or some other Iranian proxy would blow up one tank just to destabilize that region and cause the insurance prices to go up," he said. "We’re talking about a world that doesn’t have that going on anymore."
"It’s a game changer in the sense that all of a sudden, you have stability in the fastest growing part of the earth. It’s very, very bullish for world markets," O’Leary added.
Short-Term Pain, Long-Term Gain
With U.S. gas prices surging to $3.98 per gallon, up more than $1 since the conflict began, O’Leary acknowledged the immediate toll on American consumers. However, he argued that Americans understand the necessity of short-term sacrifices for long-term energy security. "They’re very sophisticated… They get the joke," he said. "They are willing to take a small amount of short-term pain for stability and security of energy in perpetuity."
O’Leary predicted that reopening the Strait of Hormuz would reduce oil prices to the mid-$70s within weeks, providing relief at the pump. He also stressed the importance of establishing a governance structure to ensure the strait remains open indefinitely, benefiting global markets and energy security.
Broader Implications
While acknowledging the human cost of conflict, O’Leary framed the situation as a strategic opportunity to resolve a decades-old geopolitical issue. "Who likes war? It’s horrible, and you feel sorry for the people in Iran," he said. "But the policy coming out of this is what investors are looking at."
O’Leary’s remarks underscore the complex interplay of energy markets, geopolitics, and economic policy, highlighting the potential for lasting stability if Iran’s grip on the Strait of Hormuz is decisively challenged.