After Iran strikes, thorough preparation is required

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After Iran strikes, thorough preparation is required

Published: 03 Mar. 2026, 00:00

Audio report: written by reporters, read by AI

A vessel is seen anchored off the coast of Dubai, United Arab Emirates on March 1. [EPA/YONHAP]

The repercussions of the U.S.-Israeli airstrikes on Iran are widening. After Iran launched retaliatory attacks that caused American casualties, U.S. President Donald Trump pledged further retaliation. As clashes between the two sides continue, Hezbollah, an Iran-backed group, has joined attacks on Israel, expanding the front. With instability spreading across the Middle East, the global economy is entering a period of deep uncertainty.

As the situation shows little sign of stabilizing, Korea must strengthen measures to protect its nationals overseas and prepare more thoroughly for risks to both financial markets and the real economy.

Financial markets have already reacted to the Middle East shock. On March 2, Japan’s Nikkei index fell as much as 2.7 percent during trading, while Hong Kong’s Hang Seng Index dropped about 2 percent. Korea’s stock market was closed Monday for the Independence Movement Day holiday, but volatility in both share prices and the exchange rate is expected when trading resumes.

Rising oil prices are another major concern. Since the outbreak of hostilities, global crude prices have risen by double digits, approaching $80 per barrel. Analysts warn that if tensions persist, prices could exceed $100, increasing inflationary pressure and raising costs for businesses and households.

The most immediate risk is Iran’s threat to close the Strait of Hormuz. Korea depends on the Middle East for about 70 percent of its crude oil and 20 percent of its liquefied natural gas imports. Roughly 95 percent of those supplies pass through the strait. A prolonged disruption would deal a direct blow to the economy.

Even if alternative routes are used, shipping costs could rise by 50 to 80 percent and delivery times could lengthen. Continued instability could fuel inflation, weaken trade and negatively affect overall exports. Major projects involving Korean companies in the Middle East, including infrastructure, defense and automotive cooperation, could also face short-term disruptions.

The crisis comes at a time when Korea’s economy has been buoyed by strong semiconductor exports and rising stock prices. For an economy heavily dependent on energy from the Middle East, heightened vigilance is essential.

The government and businesses should prepare detailed contingency plans and respond in stages to minimize potential damage.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.