According to foreign media and industry sources, the U.S. and Iran, which completed the electronic signing of a ceasefire memorandum of understanding (MOU) on June 14, are scheduled to hold an official signing ceremony in Geneva, Switzerland, on June 19. The agreement includes the reopening of the Strait of Hormuz, which had been closed since the war began on February 28, and extends the ceasefire for an additional 60 days.
Following the ceasefire announcement, international oil prices have continued to decline. On June 16, the benchmark price for Brent crude oil for August delivery fell by 5.1% to $78.96 per barrel on the Intercontinental Exchange in London. Meanwhile, West Texas Intermediate (WTI) crude oil for July delivery dropped 5.8% to $76.05 per barrel on the New York Mercantile Exchange. This marks the first time since March 2, at the onset of the Middle Eastern conflict, that Brent crude has fallen below $80 per barrel, with WTI also reaching its lowest level since early March.
Small businesses are expressing optimism. There is growing hope that trade, which had been halted due to the unexpected war, will resume and that management uncertainties will ease.
An exporter of automotive products, referred to as A, stated, "Since the news of the ceasefire agreement broke, I have received inquiries from Iranian buyers, who were previously unreachable since the war began." A added, "We are also receiving requests for expedited shipments of previously ordered products from the United Arab Emirates and Kuwait, where export routes had been blocked."
Small manufacturers are particularly focused on the reopening of the Strait of Hormuz, a critical passage connecting the Middle East to the rest of the world. If the decline in international oil prices continues alongside stable shipping rates, it could lead to reduced costs for importing raw materials and components. This is expected to help alleviate the inventory shortages caused by supply chain disruptions.
A survey conducted by the Korea Federation of Small and Medium Enterprises from May 15 to 31 found that 94.6% of 410 small businesses reported increased cost burdens due to the U.S.-Iran war. Additionally, 71.9% indicated that the average purchase price of key raw materials had risen by more than 20% compared to late February, when the war began.
The shortage of raw materials due to supply chain disruptions has also been severe. About 80.7% of surveyed companies reported experiencing a shortage of raw materials. One in three (36.1%) indicated that their current inventory would last less than a month.
Small businesses are also hopeful for a recovery in export growth. According to the Ministry of SMEs and Startups, the export value of four promising consumer goods categories—cosmetics, fashion and apparel, agricultural and seafood products, and baby products—reached $9.55 billion from January to May this year, a 16.4% increase compared to the same period last year. In contrast, exports to the Middle East fell by 12.6% during the same period, totaling $217 million, marking the only decline among the five major continents.
However, it is expected to take considerable time for raw material prices to stabilize at pre-war levels. Recovery of supply chains and logistics networks will need to follow, meaning it will take time for exports to transition into a full recovery. Ongoing disagreements between the U.S. and Iran regarding free passage through the Strait of Hormuz, as well as the nature of this agreement being more of a 60-day ceasefire extension rather than a complete end to hostilities, are also factors to consider.
Kim Hee-jung, head of the Economic Policy Division at the Korea Federation of Small and Medium Enterprises, stated, "Even if the U.S. and Iran sign the official ceasefire agreement this week, it will be difficult for raw material prices to normalize in the short term. It will take an additional 2 to 3 months for small businesses affected by the Middle Eastern war to feel the effects of the ceasefire."
* This article has been translated by AI.
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