Understanding the Strait of Hormuz: Implications of a Potential Blockade by Iran

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Key Points

Iran may close Strait of Hormuz after US strikes on nuclear facilities, state TV reports.
About 20 per cent of global oil supply flows through the strategic Strait of Hormuz each day.
Past threats to block the strait never materialised, but tensions are now at a boiling point.

Iran’s top security body must make the final decision on whether to close the Strait of Hormuz, Iranian TV said, after parliament reportedly backed the measure in response to US strikes on several of Tehran’s nuclear sites.

Iran has in the past threatened to close the strait but has never followed through on the move, which would restrict trade and impact global oil prices.

Below are details about the strait:

What is the Strait of Hormuz?

The strait lies between Oman and Iran and links the Gulf north of it with the Gulf of Oman to the south and the Arabian Sea beyond.

It is 33 kilometres wide at its narrowest point, with the shipping lane just three kilometres wide in either direction.

Why does it matter?

About a fifth of the world’s total oil consumption passes through the strait. Between the start of 2022 and last month, somewhere between 17.8 million and 20.8 million barrels of crude, condensate and fuels flowed through the strait daily, data from analytics firm Vortexa showed.

Saudi Arabia, Iran, the UAE, Kuwait, and Iraq, all OPEC members, primarily ship their crude oil through the strait, with Asia as their main destination. In efforts to avoid relying on this narrow passage, both the UAE and Saudi Arabia have been exploring alternative routes.

Strategic maritime chokepoints in global oil trade displayed on a map

There are seven strategic maritime chokepoints in global oil trade with the Strait of Hormuz ranked at number two. Source: Getty / Muhammed Ali Yigit

About 2.6 million barrels per day (bpd) of unused capacity from existing UAE and Saudi pipelines could be available to bypass Hormuz, the US Energy Information Administration said in June last year.

Qatar, among the world’s biggest liquefied natural gas exporters, sends almost all of its LNG through the strait.

The US Fifth Fleet, based in Bahrain, is tasked with protecting commercial shipping in the area.

History of tensions

In 1973, Arab producers led by Saudi Arabia slapped an oil embargo on Western supporters of Israel in its war with Egypt.

While Western countries were the main buyers of crude produced by the Arab countries at the time, nowadays Asia is the main buyer of OPEC’s crude.

The US more than doubled its oil liquids production in the last two decades and has turned from the world’s biggest oil importer into one of the top exporters.

During the 1980–1988 Iran-Iraq War, the two sides sought to disrupt each other’s exports in what was called the Tanker War.

In July 1988, a US warship shot down an Iranian airliner, killing all 290 aboard, in what Washington said was an accident and Tehran said was a deliberate attack.

In January 2012, Iran threatened to block the strait in retaliation for US and European sanctions. In May 2019, four vessels – including two Saudi oil tankers – were attacked off the UAE coast, outside the Strait of Hormuz.

Three vessels, two in 2023 and one in 2024, were seized by Iran near or in the Strait of Hormuz. Some of the seizures followed US seizures of tankers related to Iran.

Attacks on cargo vessels in the Strait of Hormuz have raised concerns about how disruptive a conflict in the Gulf could be for the global oil trade.