Forbes | Panos Mourdoukoutas : China�s next big problem won�t be in the South China Sea. It will be in the Strait of Hormuz.


That�s where both Washington and Teheran want to enforce their own freedom of�navigation.

This prospect�moves the US and Iran closer to a direct military confrontation. If that turns out to be the case, it will disrupt Middle East oil supplies and push crude oil prices above $100 level.

That�could be�bad news for China�� because the�Middle East�suppliesclose to 50% of China�s oil imports.

It could be good news�for American frackers, who will have to pump oil as fast as they can to make up any supply shortfall to America�s allies.

It could be good for Russia, which will have to sell more oil to its own allies, including China.

And it�could�serve Saudi Arabia�s interest�in containing�Iran.

For several years, Washington has been the de facto guarantor of the free flow of oil from the Gulf to its Asian and European allies. That�s a role Washington wants to continue to play, together with its close ally Saudi Arabia, an Iran adversary.