Strait of Hormuz: Key Oil Passage Threatened by US-Israel Operations Against Iran
The Strait of Hormuz, a key maritime chokepoint, has gained renewed attention following recent military actions by the United States and Israel against Iran on February 28, 2026. Dubbed "Operation Epic Fury" by the US and "Roaring Lion" by Israel, these operations targeted Iranian nuclear sites, missile facilities, and leadership compounds, including areas near Supreme Leader Ayatollah Ali Khamenei's residence. In a video statement, President Donald Trump urged the Iranian people to overthrow their government in the wake of these attacks. Iran retaliated with missile and drone strikes on Israeli territories and US military bases across the region, including those in Bahrain, Qatar, the United Arab Emirates, and Kuwait. The situation raises concerns about potential disruptions to the Strait, which could subsequently affect global oil supplies and the economy.
Geographical and Strategic Dimensions
The Strait of Hormuz, a 21-mile-wide waterway at its narrowest point, lies between Iran's southern coast and Oman's Musandam Peninsula. It serves as the only maritime exit for oil and liquefied natural gas (LNG) exports from the Persian Gulf's major producers, such as Saudi Arabia, Iraq, Kuwait, the United Arab Emirates, Qatar, and Iran. The strait connects the Persian Gulf to the Gulf of Oman, and further to the Arabian Sea and Indian Ocean, making it vital for global energy exports.
Strategically, the strait serves as a chokepoint with narrow shipping lanes limited to two-mile-wide corridors for incoming and outgoing traffic, separated by a buffer. This makes it vulnerable to military actions such as mining and missile attacks. Iran, controlling the northern side, has substantial military capabilities, including anti-ship missiles and submarines managed by the Islamic Revolutionary Guard Corps (IRGC). The US Fifth Fleet, based in Bahrain, remains in the region to ensure the safe passage of ships under international laws that recognize the right of transit passage through straits used for international navigation.
Economic Significance as an Oil and Energy Lifeline
The Strait of Hormuz's significance is rooted in its role in the global energy market. Around 20-25% of the world's seaborne oil trade, exceeding 20 million barrels per day, flows through this passage. This amounts to about one-fifth of worldwide oil consumption, mostly destined for Asian countries like China, India, Japan, and South Korea, which heavily rely on Middle Eastern imports. Additionally, the strait handles approximately 20% of global LNG trade, primarily from Qatar, the third-largest LNG exporter globally.
| Key Metric | Volume/Percentage | Primary Beneficiaries |
|---|---|---|
| Daily Oil Transit | ~20 million barrels | Asia (80%+ of exports) |
| Global Oil Trade Share | 20-25% | OPEC members (Saudi Arabia, UAE, Iraq, Kuwait, Iran) |
| LNG Trade Share | ~20% | China, India, Japan, South Korea |
| Annual Value | ~$500 billion (energy trade) | Global economy, particularly energy importers |
These figures illustrate the strait's critical role, as alternative routes like pipelines cannot fully compensate for a closure. Any disruption could cause immediate oil price hikes, as past tensions have shown, where prices surged by several dollars per barrel.
Historical Context of Tensions
The Strait of Hormuz has been a focal point in geopolitical tensions for decades. During the Iran-Iraq War from 1980 to 1988, both nations targeted tankers, prompting US naval interventions. In recent years, Iran has threatened to close the strait in reaction to sanctions or military pressures, and in 2019 and 2022, Iran's seizure of tankers alarmed the global community. Iran's military drills in the area highlight its capability to disrupt traffic, making these threats significant.
The Current Crisis: Strikes and Potential Disruptions
The attacks on February 28, 2026, have intensified risks to the strait. Reports indicate Iran has disrupted transit, with the IRGC issuing warnings and stopping tanker movements. Insurers have suspended vessel coverage in the Persian Gulf, with war-risk premiums potentially increasing by up to 50%. Oil prices rose by about 3% to over $67 per barrel after the strikes, reflecting market concerns over supply issues. The use of dark vessel tracking, where ships turn off transponders to avoid detection, has increased by 200%, indicating heightened evasion tactics amid the conflict.
Iran's retaliatory strikes, targeting not just Israel but also US interests in Gulf states, could draw in regional allies and worsen the crisis. While US and Israeli actions aim to curb Iran's nuclear and military capabilities, extended conflict might lead to a de facto blockade due to Iran's control over critical territorial waters.
Global Implications and Alternatives
A prolonged closure of the strait would have significant consequences. Energy-dependent Asian economies could face shortages, leading to increased prices and inflation. Although Europe and the US rely less directly on this route, they would still experience secondary effects through higher fuel costs and supply chain disruptions. The demand for gold and other safe-haven assets has risen, while stock markets face downward pressure.
Alternative routes offer limited capacity, and rerouting around Africa would significantly increase transit times and costs. Diplomatic efforts, including potential UN Security Council interventions, may be necessary to de-escalate, but the scale of the strikes suggests a potential for prolonged conflict.
In essence, the strategic significance of the Strait of Hormuz extends beyond its geographical scope, representing the vulnerabilities of global energy security. The ongoing US-Israel operations against Iran highlight the dangers of regional instability, where military confrontations could trigger economic shocks with widespread effects. Continuous monitoring of the situation is crucial to mitigate these risks.
