A sliver of sea no wider than a city commute carries the lifeblood of the global economy. When friction rises between Iran and the United States, that sliver, the Strait of Hormuz, becomes the world’s most watched waterway.
Tensions have sharpened as the USS Gerald R Ford, the US Navy’s largest nuclear-powered aircraft carrier, sails towards the Gulf as part of one of Washington’s biggest regional military deployments since the 2003 invasion of Iraq. Tehran has responded with its own signals. This month, Iranian authorities temporarily closed sections of the strait for live-fire drills, a pointed reminder of how swiftly a regional clash could shake global energy markets.
Why the Strait of Hormuz matters
The Strait of Hormuz is the planet’s most important oil chokepoint. It sits between Iran to the north and Oman and the United Arab Emirates to the south, linking the Gulf with the Arabian Sea and beyond.
About 50km wide at its entrance and exit and narrowing to roughly 33km at its tightest point, the passage is slender but deep enough for the world’s largest crude carriers. For Gulf producers, it is the main export route. For energy-hungry economies, it is a vital supply line.
How much energy flows through it?
The scale is vast. According to the US Energy Information Administration, around 20 million barrels of oil passed through the strait each day in 2024, with energy trade worth close to $500bn a year.
Crude shipments originate from Iran, Iraq, Kuwait, Qatar, Saudi Arabia, and the UAE. Any sustained disruption would hit both exporters and the countries that rely on their fuel.
Liquefied natural gas (LNG) flows are equally critical. Roughly one-fifth of global LNG trade transited the corridor in 2024, with Qatar accounting for the bulk of those volumes.
Who depends on it most?
Asia is the main destination. The EIA estimates that 84 per cent of crude oil and condensate moving through Hormuz last year was bound for Asian markets. LNG shows a similar pattern, with 83 per cent heading east.
China, India, Japan, and South Korea together accounted for 69 per cent of crude and condensate flows through the strait in 2024. Their industries, transport systems, and power grids depend heavily on Gulf supplies.
The traffic is not one-way. Kuwait and the UAE import LNG sourced from outside the Gulf, including cargoes from the US and West Africa, through the same channel.
What could Iran do?
Under international law, coastal states exercise sovereignty up to 12 nautical miles from their shores. At its narrowest point, shipping lanes through Hormuz lie within the territorial waters of Iran and Oman. That geography gives Tehran leverage.
Roughly 3,000 vessels cross the strait each month. Military analysts say one of the most effective ways to disrupt traffic would be the deployment of naval mines using fast attack boats or submarines. Iran’s fleet includes fast boats armed with anti-ship missiles, surface vessels, semi-submersible craft, and submarines suited to asymmetric warfare.
Iran’s parliament approved a motion last year backing the closure of the strait, though any final order would rest with Supreme Leader Ali Khamenei.
Risks are not confined to Hormuz. In Yemen, the Houthi movement, aligned with Iran, has previously targeted shipping through the Bab al-Mandab Strait, another crucial chokepoint linking the Red Sea to global trade routes. Disruption there intensified after Israel’s war in Gaza began in October 2023. Any simultaneous pressure on both corridors would magnify the strain on shipping and insurance markets.
What would happen to oil prices?
A closure, even partial or short-lived, would send prices sharply higher.
Colby Connelly, head of Middle East content at Energy Intelligence, said a blockade would have a “major impact on oil prices in the near term”, depending on how long transit is hindered.
“There are no other major sources of supply that can make up for what comes from the Gulf, especially given the consideration that around 70 per cent of OPEC+ spare production capacity sits in the Gulf,” he said.
Saudi Arabia exports about 5.5 million barrels per day through the strait, more than any other regional producer. Iran’s own exports, roughly 90 per cent of which go to China, averaged about 1.7 million barrels per day in the first half of 2025, according to EIA figures.
“Saudi Arabia and the UAE both have limited pipeline capacity that can allow exports to continue via the Red Sea coast and Fujairah,” Connelly warned.
Some producers hold oil in overseas storage, offering a short-term cushion. But if disruption were serious, he added, “Oil prices have been highly reactive to geopolitical tensions in recent weeks, and as a result, prices could spike to well over $100 per barrel if there were to be a major disruption.”
What would it mean for the wider economy?
Higher crude and gas prices would quickly feed through to transport, electricity, and manufacturing costs. China, which relies heavily on exports and industrial output, would feel the impact. So would other major Asian economies.
Nearly half of India’s crude imports and about 60 per cent of its gas supplies pass through Hormuz. South Korea sources around 60 per cent of its crude via the same route. Japan depends on it for close to three-quarters of its oil imports.
In short, the Strait of Hormuz is more than a shipping lane. It is a pressure point for the global economy. Any move to close it, even briefly, would be felt far beyond the Gulf.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: ZEE News
