The Strait of Hormuz: The World’s Most Critical Oil Chokepoint and Iran’s Threats Explained

Explore the Strait of Hormuz, the world’s critical oil chokepoint, and Iran’s threats to close it after U.S. strikes in 2025. Learn its global economic and strategic importance, Iran’s capabilities, and the likelihood of a closure in this detailed explainer.

On June 22, 2025, tensions in the Middle East escalated as Iran threatened to close the Strait of Hormuz in response to U.S. strikes on its nuclear facilities in Isfahan, Natanz, and Fordow. This narrow waterway, connecting the Persian Gulf to the global oil markets, is often called the “world’s most important oil transit route.” But what makes the Strait so vital, and how realistic is Iran’s threat to shut it down? This explainer dives into the Strait’s strategic and economic significance, Iran’s capabilities and motivations, and the potential global fallout of a closure.

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Why the Strait of Hormuz Matters

A Global Energy Lifeline

The Strait of Hormuz, a 33–100 km wide passage between Iran and the Arabian Peninsula, is the gateway for roughly 20–21% of the world’s daily oil consumption—about 18–20 million barrels per day. Major oil producers like Saudi Arabia, Iran, Iraq, Kuwait, and the UAE rely on the Strait to export crude oil to global markets, particularly Asia. It also carries one-fifth of the world’s liquefied natural gas (LNG), making it critical for energy security.

Beyond energy, the Strait of Hormuz is a vital trade route. Ports like Jebel Ali (UAE) and Dammam (Saudi Arabia) depend on it for importing and exporting goods, including commodities like palm oil. Any disruption here ripples through global supply chains, driving up costs for everything from fuel to consumer goods.

Economic Stakes

A closure of the Strait of Hormuz would be catastrophic for global markets. Analysts from JP Morgan estimate oil prices could spike to $120–$130 per barrel if the Strait were blocked. Alternative routes, like Saudi Arabia’s East-West Pipeline (7 million barrels per day) or the UAE’s Fujairah Pipeline (1.8 million barrels per day), can only handle a fraction of the Strait’s volume—about 2.6 million barrels per day combined. Even countries not directly reliant on Gulf oil would face soaring global prices, impacting industries, transportation, and households worldwide.

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Strategic Leverage

Iran’s proximity to the Strait of Hormuz gives it immense geopolitical leverage. By merely threatening closure, Iran can pressure Western nations and disrupt energy markets without firing a shot. Past incidents, like the 2019 seizure of the British-flagged tanker Stena Impero or attacks on tankers in the Strait, show Iran’s ability to create chaos without fully closing the waterway.

Iran’s Threats: Context and Capabilities

Why Now?

Iran’s latest threats stem from U.S. strikes on its nuclear facilities, seen as a direct challenge to its sovereignty. High-ranking officials, including Hossein Shariatmadari, a close aide to Supreme Leader Ali Khamenei, have called for missile strikes on U.S. naval forces in Bahrain and a blockade of the Strait to Western ships. Other officials, like Mohsen Rezaee and Esmail Kowsari, have reinforced these warnings, signaling that closing the Strait is a serious option.

These threats fit a pattern. Iran has threatened to close the Strait of Hormuz during past tensions, such as the Iran-Iraq War (1980–1988) and after the U.S. withdrew from the nuclear deal in 2018. However, it has never fully followed through, as the move would harm its own economy, particularly its oil exports to China.

Can Iran Close the Strait of Hormuz?

Iran has the tools to disrupt the Strait of Hormuz, if not fully close it. Its navy, including the Islamic Revolutionary Guard Corps (IRGC), operates submarines, fast-attack boats, and an arsenal of naval mines (depth charges, moored mines, and bottom mines). These could be used to block the Strait’s narrow 21-nautical-mile chokepoint or target commercial vessels. Recent reports note increased electronic interference with ship navigation systems, adding to the chaos, with about 50 oil tankers reportedly trying to exit the Strait amid fears of escalation.

However, a full closure is no easy task. The Strait’s depth and width make it difficult to block entirely, and Iran would face a swift military response from the U.S., UK, and allies, who maintain a strong naval presence, including the U.S. Fifth Fleet in Bahrain. The U.S. has prepared mine-clearing operations, though these could take weeks and be costly. Iran’s own reliance on the Strait for oil exports further complicates the decision, as a closure could cripple its economy.

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Historical Precedent: Threats vs. Action

Iran has a history of using the Strait of Hormuz as a bargaining chip. During the 1980s “Tanker War,” Iran and Iraq attacked each other’s shipping, but the Strait remained open. In 2019, Iran seized tankers and conducted drone attacks on Saudi oil facilities, raising fears of closure, yet it stopped short of a full blockade. Analysts like Noam Raydan from the Washington Institute for Near East Policy argue that Iran would only consider closing the Strait if its own oil infrastructure were severely damaged—an unlikely scenario in the current conflict.

Global Implications of a Closure

Energy Markets

A prolonged closure would slash global oil supply, driving prices to levels not seen since the 1970s oil crises. Even a partial disruption, like mining the Strait or attacking tankers, could delay shipments and spike prices. However, global oil markets are currently well-supplied, and the International Energy Agency (IEA) has trimmed 2025 demand forecasts, suggesting some buffer against short-term shocks.

Trade and Supply Chains

Disrupting the Strait would hit global trade hard. Countries like India, heavily reliant on Gulf oil and trade through ports like Jebel Ali, would face higher costs and delays. Shipping routes would need rerouting, increasing fuel and logistics expenses, which would ultimately raise prices for consumers worldwide.

Geopolitical Fallout

A closure would likely trigger a military response from the U.S. and its allies, escalating the conflict into a broader regional war. The U.S. and UK have conducted naval exercises in the region to deter Iran, and any aggressive move would test their resolve. China, a major buyer of Iranian oil, might also pressure Iran to avoid a closure to protect its own energy interests.

Is a Closure Likely?

Despite Iran’s fiery rhetoric, a full closure remains unlikely. Analysts like Hitesh Jain from Yes Securities call it “strategically and economically self-defeating” for Iran. The country’s leadership knows that blocking the Strait would invite devastating retaliation and hurt its own oil-dependent economy. Instead, Iran may opt for limited disruptions—such as harassing tankers or deploying mines—to flex its muscles without crossing the line into full-scale conflict.

Conclusion

The Strait of Hormuz is more than just a waterway—it’s a linchpin of global energy and trade. Iran’s threats to close it are a high-stakes gamble, leveraging the Strait’s importance to pressure the West. While Iran has the means to cause significant disruption, the economic and military costs of a full closure make it a risky move. For now, the world watches closely as tensions simmer, with the Strait remaining open but under threat. The situation underscores the fragile balance of power in the Middle East and the global economy’s reliance on this narrow stretch of water.