The Strait of Hormuz is a narrow but crucial maritime passage between the Musandam Peninsula of Oman and the southern coast of Iran. It stands as one of the most strategically vital waterways of the world—the only sea channel linking the oil-rich Persian Gulf (west) with the Gulf of Oman and the Arabian Sea (Southeast). The chokepoint which is just 30 miles (48 km) wide at its narrowest, serves as the only sea route connecting the Persian Gulf oil producers to the rest of the world. Approximately 21 million barrels of crude oil and refined products pass through it daily. About 84 per cent of the oil and liquified natural gas (LNG) is distributed to Asian countries including China, India, Japan, and South Korea. Around 20 per cent of global oil supplies and nearly one-third of the world’s LNG transit through this narrow channel. As a result, the strait’s security and accessibility are paramount for global energy stability and economic well-being.
In the recent years, and especially since early 2025, heightened geopolitical tensions in the Middle East have brought the Strait of Hormuz into sharp focus. Following military confrontations, attacks on tankers and aggressive rhetoric amidst Iran-Israel-US, the risk of disruption in this crucial waterway has escalated, triggering global concerns about the potential for conflict, economic shockwaves, and broader instability.
Geography and Strategic Importance
The Strait of Hormuz is a narrow maritime corridor between Oman and the Iranian coastline. According to UN rules, countries are allowed to exercise control up to 12 nautical miles (a little over 22 km) from their coastline. This means that at its narrowest point, the Strait of Hormuz and its shipping lanes lie entirely within Iran and Oman’s territorial waters.
It connects the Persian Gulf, which is home to some of the largest oil and gas reserves in the world, to the Gulf of Oman and the Arabian Sea. This geographic positioning means that all crude oil and LNG exports from Gulf countries, such as Saudi Arabia, Iran, the UAE, Kuwait, Qatar, Bahrain, and Iraq must pass through this channel to reach global markets.
Due to strategic position and narrow width, it is the world’s single important oil transit chokepoint. Commercial shipping lanes are tightly regulated with designated Traffic Separation Scheme (TSS) on either side to manage the flow of vessels. Though the strait is relatively deep near the Musandam Peninsula, it remains vulnerable to blockage or sabotage given the high concentration of maritime traffic and limited navigable space. Fully laden very large crude carriers (VLCCs) could navigate the strait; however, the narrow lanes amplify the risks of accidents or deliberate attacks.
Iran’s proximity to the strait gives it significant strategic leverage. Historically, Iran has threatened to close or mine the strait in response to sanctions or military aggression, which would paralyse the region’s oil exports and cause global energy prices to soar.
Historical Context and Regional Dynamics
The Gulf region’s tumultuous history highlights the ongoing volatility surrounding the Strait of Hormuz. During the Iran-Iraq War of the 1980s, the two nations engaged in the so-called ‘Tanker War’, attacking oil tankers and merchant vessels to cripple each other’s economies. This conflict drew the US into the Gulf, as it sought to protect the free flow of oil. In 1988, the US Navy mistakenly shot down an Iranian passenger plane over the Gulf, killing 290 civilians in one of the most tragic incidents of the era.
In more recent decades, tensions have been persisting. In 2010, Al-Qaeda-affiliated militants attacked a Japanese oil tanker near the strait, underscoring ongoing security risks. Subsequent proxy conflicts, especially between Saudi Arabia and Iran have intensified the strategic competition, with both powers supporting opposing factions in countries, such as Yemen, Syria, Iraq, and Lebanon.
Iran’s nuclear programme and international sanctions have been key breaking points. Western efforts to prevent Iran from acquiring nuclear weapons included targeting oil exports, which Iran has repeatedly vowed to counter by threatening the security of the strait. These intimidating tactics culminated in the 2015 nuclear deal between the world powers and Iran temporarily eased the tensions. However, it was abandoned by the US in 2018 under President Trump’s administration (first tenure), leading to a renewed cycle of sanctions and confrontations.
Recent Incidents and Escalations
Tensions between the US and Iran have reached new heights in 2025. Following the US airstrikes against Iranian nuclear sites in June 2025, Iranian officials threatened to close or mine the Strait of Hormuz in retaliation. The possibility of closing or mining the strait alarms military planners because it could trap US Navy vessels and choke global oil supplies.
Economic Stakes and Global Impact
The economic importance of the Strait of Hormuz could not be overstated. A disruption could send global energy prices soaring, affecting economies worldwide.
Asia is particularly vulnerable, with major consumers such as China, India, Japan, and South Korea, which are heavily dependent on the Gulf oil passing through the strait. China, as the world’s largest buyer of Iranian oil, has significant leverage and a vested interest in preventing the closure of the strait. The US has actively urged China to pressure Iran to keep the waterway open, warning Iran that closing the strait would amount to ‘economic suicide’ due to the repercussions it would face from global markets and regional neighbours. China has stated that the recent US strikes on Iran’s nuclear facilities have damaged the credibility of the US and asked US to call for an immediate ceasefire. Furthermore, it stated that the US involvement in Iran has further complicated and destabilised the Middle East situation.
Efforts to bypass the strait by constructing pipelines in the UAE and Saudi Arabia are ongoing but remain insufficient to replace the strait’s massive capacity. Until alternatives become operational at scale, the global oil market remains vulnerable to any instability in the strait.
Following the attacks by Israel and US on Iran in June 2025, oil prices spiked briefly. For instance, Brent crude oil hit US$ 81.40 per barrel, before settling back, reflecting the market nervousness. Price fluctuations ripple through economies, increasing costs for transportation, manufacturing, and consumer goods.
Had the strait been blocked by Iran, then the rising oil prices would have cost Indian industries too. Paint makers, like Asian Paints and Berger, would have had their raw materials priced higher, while pharma companies such as Dr Reddy’s, Lupin, and Sun Pharma would have felt the impact on production and logistics. Airlines, where fuel makes up 30 to 40 per cent of its expenses, would see lesser profits. Cement, steel, and fertiliser industries would have struggled with higher diesel and input costs. Even fast-moving consumer goods (FMCG) companies like Hindustan Unilever Limited and Dabur would have increased the prices of their products due to increased distribution expenses.
Military Posture and Strategic Calculations
The US has responded to the escalating threat with increased military deployments, sending additional troops and assets to the region. The US Navy’s Fifth Fleet based in Manama, Bahrain, plays a critical role in securing the strait and maintaining freedom of navigation.
Iranian leaders understand the risks involved. Iran, despite its strategic weaknesses maintains a capable navy and an array of asymmetric warfare tools such as mines, speedboats, missile batteries, and shadowy elite force known as the Quds Force. Iran’s fast boats are often armed with anti-ship missiles and the country also operates surface vessels, semi-submersible craft, and submarines. Military analysts highlight Iran’s potential to carry out sustained mine-laying operations in the strait, which could force a complex, high-risk mine-clearing campaign by the US Navy lasting weeks or months. This would expose American sailors to danger and significantly disrupt commercial shipping.
According to experts, Iran could block the strait only temporarily as the US and its allies have the capability to restore maritime traffic through military means.
Proxy Conflicts and Regional Rivalries
The Gulf region is also marked by proxy conflicts, mainly between Iran and Saudi Arabia, competing for regional influence. Both countries back political and militant groups across the Middle East, leading to instability, given that Iranian-aligned militias in Iraq, Lebanon, Syria, Bahrain, Qatar, and Yemen’s Houthi rebels are active players. Saudi Arabia and the UAE support opposing factions for receiving US backing.
The proxy warfare complicates efforts to stabilise the Strait of Hormuz and the wider region. Attacks on pipelines, shipping, and military assets are often indirect action by proxies, denying any involvement in unethical activities by Iran increasing the risk of miscalculation.
Diplomatic Efforts and International Concerns
Amidst recent rising tensions, the international community has been watching with much concern. The US has called upon China and other global powers to use diplomatic influence on Iran to avoid the closure of the strait or military escalation.
European nations, particularly the UK, have been persistently involved in maritime security efforts, exemplified by Britain’s seizure of an Iranian tanker in 2019, which was suspected of breaching sanctions and accusations of Iranian vessels attempting to obstruct British commercial ships.
The UN and various diplomatic actors emphasise the catastrophic global consequences of closing the strait, urging dialogue to de-escalate.
Conclusion
The Strait of Hormuz remains a driving force to global energy security and a breaking point for geopolitical conflict. Its narrow waters carry a disproportionate share of the world’s oil and gas, making any threat to its openness a matter of international urgency. Recent years have seen a dangerous escalation in tensions, military confrontations, and proxy conflicts that risk turning into wider war.
The global community faces a complex challenge: safeguarding this vital waterway, managing the competing interests of regional powers and preventing a devastating disruption that would be reflected through economies and societies worldwide. In this volatile environment, cautious diplomacy, strategic military preparedness, and international cooperation are more critical than ever.
© Spectrum Books Pvt. Ltd.
