The Strait of Hormuz is arguably the world’s most critical energy chokepoint, handling nearly 20 million barrels of crude oil every day — about one-fifth of global consumption. Any disruption here would severely impact oil exports from key producers such as Saudi Arabia, Iraq, the UAE, and Kuwait.
Although a few alternative pipelines exist, they can only transport a fraction — approximately 2.6 million barrels per day — of the region’s total oil output. Additionally, liquefied natural gas (LNG) shipments from Qatar, which are vital to energy-hungry markets in Asia and Europe, would also be jeopardized.
Read more: Pakistan condemns Trump’s bombing of Iran – a day after nominating him for Peace Prize
Tensions in the Middle East have now erupted into open conflict after the United States launched airstrikes on Iran’s nuclear facilities — targeting Fordow, Natanz, and Esfahan — in what President Donald Trump described as a “spectacular military success” that had “completely obliterated” Iran’s nuclear enrichment capabilities. In response, Iran’s Islamic Revolutionary Guard Corps (IRGC) has threatened to fully close the Strait of Hormuz within hours — a move that would shake the global energy and financial landscape.
The stakes are high not just for oil producers, but for economies worldwide. Brent crude prices have already surged past $90 per barrel, while WTI crossed $87. Analysts warn that a prolonged closure could push prices as high as $120–$150, fuelling market volatility and intensifying inflationary pressures globally.
Read more: Vance opposes US involvement in Iran-Israel war
Such a shock could contract global GDP by 1–2% and heighten the risk of a worldwide recession. Supply chains would slow, shipping insurers are pricing in fresh war-risk premiums, and energy-dependent industries everywhere would feel the heat.
For India, the situation is especially alarming. The country imports nearly 90% of its crude oil needs, with more than 40% passing through the Strait of Hormuz. Any disruption would directly affect refinery operations, widen the trade deficit, and accelerate domestic inflation through soaring fuel prices. The Indian rupee would likely weaken under pressure, forcing the government to dip into its 74-day strategic oil reserves to cushion the blow. Industries reliant on petrochemicals, transportation, and power generation would also suffer, potentially slowing economic growth.
In essence, the world — and energy-dependent nations like India in particular — cannot afford to overlook the strategic importance of the Strait of Hormuz. A full-scale closure would send shockwaves through global markets, destabilize economies, and threaten geopolitical stability well beyond the Middle East.