Emirates 24/7 — On geographical maps, the Strait of Hormuz is a narrow waterway connecting the Arabian Gulf to the Sea of Oman and the Indian Ocean. In the maps of the global economy, however, it appears as something entirely different, as it is considered the largest energy artery on the planet. Through this strait, which at its narrowest point does not exceed a few dozen kilometers, enough oil and gas pass daily to keep the world’s factories, power plants, and cars in perpetual motion.
The disruption of this corridor effectively threatens the cycle of the global economy and not just the regional one. Within one week of the conflict, the American citizen has already paid 16% more for the price of fuel, while the budgets of countries for the current fiscal year await severe disruptions if the suspension of energy supplies due to Iran is prolonged.
Data from the U.S. Energy Information Administration (EIA) indicates that approximately 20 million barrels of oil per day transit the Strait, equivalent to nearly one-fifth of global oil consumption and more than a quarter of the world’s sea-borne oil trade. This makes the Strait one of the most dangerous chokepoints in the international energy system. In this sense, any disturbance in this small maritime corridor can be reflected immediately in global energy markets, from Tokyo to New York.
Energy exports from the most important producers in the region flow through the Strait of Hormuz, yet the matter is not limited to oil. Approximately 20% of the world's liquefied natural gas (LNG) trade also passes through the Strait, most of it destined for Asia. For this reason, countries such as China, India, Japan, and South Korea have become the most dependent on this vital corridor, as the majority of oil shipments passing from the Gulf are directed toward Asian markets.
In a world that depends on sea-borne energy, some maritime passages are described as strategic chokepoints, and the Strait of Hormuz is the most prominent of them. According to international energy analyses, approximately 34% of the global crude oil trade passes through this strait alone, a figure reflecting the extreme degree of concentration in the global energy trade. The major problem is that alternatives are limited; even with the existence of pipelines that bypass the Strait, their combined capacity cannot transport but a small fraction of the daily flows that cross it.
This means that any major disruption to navigation inevitably leaves an immediate impact on oil prices and global economic growth. Media reports indicate that any disruption to navigation in the Strait could remove nearly 20 million barrels per day of oil supplies from the global market, potentially causing a massive shock in the energy markets. Economic reports have also warned that the disruption of shipping through the Strait could raise oil prices and threaten energy security, particularly in Asia, which relies heavily on Gulf supplies.
The story of the Strait of Hormuz reveals an ancient truth in international politics; which is that small geography may control the large economy. This narrow maritime passage has today become a sensitive balance point between politics, energy, and global trade.