Strait of Hormuz

The Strait of Hormuz is a narrow, strategically vital waterway connecting the Persian Gulf to the Arabian Sea and, by extension, the wider Indian Ocean. Flanked by Iran to the north and the Musandam Governorate of Oman and the United Arab Emirates to the south, it is arguably the world’s most critical maritime chokepoint, through which a significant portion of the globe’s energy supplies transit.

Geographical Significance

The Strait of Hormuz is approximately 90 nautical miles (167 km) long, with its width varying from about 52 nautical miles (96 km) to a mere 21 nautical miles (39 km) at its narrowest point. The navigable shipping lanes are even more restricted, extending only about two miles in each direction, separated by a two-mile-wide median. This geographical constriction, combined with the immense volume of traffic, makes it highly vulnerable to disruptions. To manage the flow and minimise collision risks, ships follow a Traffic Separation Scheme (TSS) under the transit passage provisions of the United Nations Convention on the Law of the Sea.

Economic Importance

The economic significance of the Strait of Hormuz cannot be overstated. It serves as the primary maritime artery for oil and gas exports from major producers in the Persian Gulf, including Saudi Arabia, Iraq, UAE, Qatar, Iran, and Kuwait.

• Oil Transit: Approximately one-fifth of the world’s total oil consumption, or about 20-21 million barrels per day, passes through the Strait of Hormuz. This represents a substantial portion of global seaborne oil shipments.
• LNG Transit: In addition to oil, a significant amount of liquefied natural gas (LNG) also transits the Strait, accounting for roughly one-third of the global LNG trade.
• Asian Dependency: The overwhelming majority (over 80%) of crude oil and condensate exports passing through the Strait are destined for Asian markets, with China, India, Japan, and South Korea being the largest recipients. For countries like India, which imports approximately 90% of its crude oil, with over 40% originating from Middle Eastern nations, the Strait is an existential trade route.

Any disruption to the free flow of energy through this waterway has immediate and severe implications for global energy security, prices, and supply chains.

How has it become a Global Geopolitical Chokepoint?

The Strait of Hormuz has long been a focal point of geopolitical tensions, particularly concerning Iran’s strategic position. Iran has repeatedly threatened to close or disrupt shipping in the Strait in response to perceived threats or sanctions from the United States and its allies.

Current Situation (June 2025): The geopolitical landscape surrounding the Strait of Hormuz is currently highly volatile. Following recent US strikes on Iranian nuclear facilities, Iran’s Parliament has reportedly approved a decision to close the Strait of Hormuz. While the final decision rests with Iran’s Supreme National Security Council, this move underscores Iran’s willingness to weaponise its geographical advantage in response to escalating tensions.

• Iranian Leverage: Iran possesses the capability to hinder shipping through various means, including naval blockades, mines, and drone attacks. While a full closure would be counterproductive to Iran’s own oil exports, even partial disruptions can send global oil prices skyrocketing and destabilize markets.
• Global Impact: A complete blockage, even temporary, could cut global oil supplies by a substantial margin, potentially exceeding the impact of historical disruptions like the 1979 Iranian revolution. This would have profound economic ramifications worldwide, particularly for energy-dependent Asian economies.
• Security Concerns: The recent collision of two oil tankers near the Strait, alongside reports of spotty navigation signals and increased wariness among shipowners, highlight the fragility of maritime security in the region amidst heightened conflict.

Implications for Global Powers

• United States: The U.S. Fifth Fleet maintains a significant presence in the region to ensure freedom of navigation and deter any attempts to close the Strait. Any Iranian move to block the waterway would likely be met with a robust international response.
• Asian Economies: Countries like China, India, Japan, and South Korea are particularly vulnerable to disruptions in the Strait due to their heavy reliance on Middle Eastern oil and gas imports. While some diversification of energy sources is ongoing (e.g., India’s increased imports from Russia via alternative routes), a closure would still necessitate a scramble for alternatives, driving up costs and destabilising supply chains.
• Oil Markets: The threat of disruption alone can cause significant fluctuations in global oil prices. A prolonged closure would lead to a severe supply shock, potentially pushing Brent crude prices to unprecedented levels.

The Strait of Hormuz remains a critical artery for global energy trade and a persistent flashpoint in international relations. Its narrow confines and strategic location grant Iran significant leverage in regional geopolitics, particularly during periods of heightened tension. As the world navigates complex geopolitical dynamics and the ongoing need for energy security, the stability of the Strait of Hormuz will continue to be a paramount concern for governments and markets worldwide.

What are the alternatives to the Strait of Hormuz?

While the Strait of Hormuz is the primary and most efficient route for oil and gas exports from the Persian Gulf, there are some existing and proposed alternatives, primarily in the form of pipelines. However, these alternatives have limited capacity and cannot fully replace the immense volume of oil and gas that transits the Strait.

1. Pipelines Bypassing the Strait:

• Saudi Arabia’s East-West Pipeline (Petroline): This is the most significant existing alternative. It runs from the Abqaiq oil processing centre near the Persian Gulf to the Red Sea port of Yanbu. It has a design capacity of 5 million barrels per day (b/d) and has been temporarily expanded to 7 million b/d. In times of disruption around the Strait of Hormuz, Saudi Arabia can pump more crude through this pipeline to ports on the Red Sea, from where it can then be shipped to global markets. However, it rarely operates at full capacity, leaving some spare capacity for diversion.
• UAE’s Abu Dhabi Crude Oil Pipeline (ADCOP): This pipeline connects onshore oil fields in Abu Dhabi to the Fujairah export terminal on the Gulf of Oman, effectively bypassing the Strait of Hormuz. It has a capacity of around 1.5 to 1.8 million b/d. The UAE has also built significant oil storage facilities at Fujairah.
• Iran’s Goreh-Jask Pipeline: Iran itself has built a pipeline from Goreh to the Jask export terminal on the Gulf of Oman, aiming to provide an alternative export route that avoids the Strait of Hormuz. It was inaugurated in 2021 with an effective capacity of around 300,000 b/d, but its usage has been inconsistent.
• Iraqi Pipelines: While some Iraqi pipelines exist, such as the Iraqi Pipeline through Saudi Arabia (IPSA), many have faced operational issues or political closures in the past. There are also proposals for pipelines from Iraqi Kurdistan to Turkey (to the port of Ceyhan), which would bypass the Gulf entirely.

Limitations of Pipeline Alternatives:

• Limited Capacity: Even collectively, the existing bypass pipelines can only handle a fraction of the 20-21 million b/d that typically transits the Strait of Hormuz. A complete closure would still result in a significant global supply shock.
• Cost and Time: Expanding pipeline capacity is a costly and time-consuming endeavour, making it unsuitable for immediate responses to disruptions.
• Geopolitical Vulnerability: These pipelines can also be targets of attack or political leverage, as seen with past disruptions to various regional pipelines.

2. Longer Maritime Routes (Less Practical for Most Persian Gulf Oil):

For oil that originates within the Persian Gulf, there are no practical alternative sea routes that completely bypass the Strait without using existing pipeline infrastructure to move it to another coast first.

• Round Africa (Cape of Good Hope): For shipments destined for Europe or the Americas, vessels could theoretically bypass the Red Sea/Suez Canal and sail around the Cape of Good Hope. However, this dramatically increases transit time and shipping costs, making it highly uneconomical for regular operations from the Persian Gulf. This route is more relevant as an alternative for vessels transiting the Suez Canal if the Bab al-Mandeb Strait (at the entrance to the Red Sea) is disrupted.