Why the Strait of Hormuz matters so much in the Iran war

Why the Strait of Hormuz Matters in the Iran War

The Strategic Waterway’s Global Significance

The Strait of Hormuz, a vital maritime passage between the Gulf and the Arabian Sea, has long been central to global energy flows. It is bounded by Iran to the north and Oman, along with the United Arab Emirates, to the south. At its narrowest, the waterway measures just 33 kilometers wide, while its entry and exit points are approximately 50 kilometers wide. This narrow corridor allows the world’s largest crude oil tankers to pass through, serving as a critical route for major Middle Eastern producers and their customers.

During recent hostilities, Iran’s actions disrupted this lifeline, leading to a surge in global fuel prices. The United States and Israel’s attack on Iran on 28 February triggered a blockade, halting nearly 20% of the world’s oil and liquefied natural gas (LNG) shipments. However, the announcement of a ceasefire between Iran and the US in late March brought prices down by about 15%, signaling a temporary reprieve for energy markets.

Trade Volumes and Economic Impact

Estimates from the US Energy Information Administration (EIA) indicate that 20 million barrels of oil and oil products traverse the strait daily, contributing over $600bn annually to global energy trade. This volume includes shipments from Iran, Iraq, Kuwait, Qatar, Saudi Arabia, and the UAE, with Qatar accounting for the majority of LNG exports. In 2024, Qatar alone sent 9.3 billion cubic feet per day (Bcf/d) of LNG through the waterway, while the UAE contributed around 0.7 Bcf/d.

LNG, or liquefied natural gas, is converted into a liquid form for easier transport, occupying 600 times less space than its gaseous state. Upon arrival, it is reconverted into gas for domestic use, including heating and power generation. The strait also facilitates fertiliser exports from the Middle East, with a third of the world’s trade passing through its waters. Additionally, it supports imports of essential goods like food, medicines, and technology into the region.

Threats and Maritime Control

Under international law, countries can exercise control over their territorial seas up to 12 nautical miles from their coastlines. At the strait’s narrowest point, shipping lanes fall entirely within the territorial waters of Iran and Oman, making them vulnerable to attacks. Iranian drones, missiles, and fast attack boats have posed a significant risk, with fears of mines further complicating navigation. According to United Against Nuclear Iran, at least 24 commercial vessels were damaged, and three experienced near misses, as of 2 April.

“You can be attacked, and you can’t get insurance or it is extremely expensive,” said Arne Lohmann Rasmussen, chief analyst at Global Risk Management, during the period of instability.

The disruption has affected economies worldwide, particularly in Asia, where China absorbs around 90% of Iran’s oil exports. This has led to measures like shortened workweeks, early university closures, and reduced electricity consumption in countries such as South Sudan and Mauritius. In Europe, Slovenia became the first EU nation to implement fuel rationing in response to the crisis.

US Military Response and Historical Context

The US has opted for air strikes over deploying warships to the strait, targeting Iranian anti-ship missile sites. On 18 March, the military reported bombing facilities along the waterway to counter threats. President Trump had previously urged allies and China to secure Hormuz by sending warships, but the request lacked strong support. He later asserted that the US could manage the situation independently.

Historically, the strait has been a battleground. During the Iran-Iraq war in the late 1980s, strikes on oil infrastructure escalated into a “tanker war,” where both nations attacked neutral vessels to exert economic pressure. Kuwaiti tankers, carrying Iraqi oil, were especially at risk. The US later deployed warships to protect shipping lanes, ensuring the flow of critical energy supplies.