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

The Strategic Importance of the Strait of Hormuz in the Iran Conflict

In response to escalating tensions, Iran and the United States have agreed to a truce, contingent upon ensuring unimpeded transit through the Strait of Hormuz, a vital maritime corridor. Tehran had imposed a blockade on the strait, one of the world’s most critical oil shipping routes, following the US and Israeli strikes on the country on 28 February. Approximately 20% of the world’s oil and liquefied natural gas (LNG) typically flows through the strait, with hostilities leading to a sharp rise in global fuel prices. Shortly after the ceasefire announcement, oil prices dropped by roughly 15%.

A Geographical and Economic Nexus

Enclosed to the north by Iran and to the south by Oman and the United Arab Emirates (UAE), the strait narrows to just 33 kilometers at its most constricted point. It measures around 50 kilometers at its entrances and exits, making it a key chokepoint connecting the Gulf to the Arabian Sea. The strait’s depth accommodates the world’s largest crude oil tankers, and it serves as a primary passage for Middle Eastern oil and LNG producers, along with their international buyers.

According to the US Energy Information Administration (EIA), about 20 million barrels of oil and oil products traverse the strait daily in 2025, representing nearly $600 billion in annual energy trade. This volume includes contributions from Iran, alongside Iraq, Kuwait, Qatar, Saudi Arabia, and the UAE. Approximately 20% of global LNG shipments also pass through the strait, primarily from Qatar, with the UAE accounting for 0.7 Bcf/d. Liquefied natural gas (LNG) is converted into a liquid form, reducing its volume by 600 times for transport, then re-gasified at destination for domestic use in heating, cooking, and power generation.

Threats and Disruptions

Under UN maritime regulations, countries can enforce control within 12 nautical miles of their coasts. At the strait’s narrowest point, the shipping lanes fall entirely within Iran and Oman’s territorial waters, exposing vessels to threats like drones, missiles, and potential mines. During recent hostilities, Iran’s actions caused a dramatic decline in ship traffic, with around 3,000 vessels usually navigating the strait monthly. This number plummeted as the country warned of attacks on tankers and other ships.

“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.

Gulf nations, including Iran, depend heavily on energy exports for their economies. Disruptions in the strait significantly affected Asia, particularly China, which accounts for approximately 90% of Iran’s global oil exports. The fuel shortage impacted daily life across Asia, prompting governments to implement measures such as remote work mandates, reduced workweeks, early university closures, and national holidays to conserve supplies. In Africa, South Sudan and Mauritius introduced electricity rationing. Europe saw Slovenia become the first EU state to enforce fuel rationing.

Military Responses and Historical Context

The US has not deployed warships to the strait, focusing instead on aerial strikes against Iran’s anti-ship missile sites, including those near the strait. On 18 March, the military reported bombing such sites. President Trump previously urged allies and even China to secure Hormuz with warships, but his call received limited support. He later asserted the US could manage the situation independently, recalling past efforts to restore maritime traffic during the Iran-Iraq war in the late 1980s, which escalated into a “tanker war” involving attacks on neutral vessels.