A narrow waterway at the mouth of the Persian Gulf. More than a third of the world's seaborne crude oil and about a fifth of its liquefied natural gas (LNG) pass through it. In 2025, Asia absorbed roughly 87% of the crude and 86% of the LNG transiting the strait.
Japan gets approximately 95% of its oil from the Middle East, with roughly 70% routed through the strait. South Korea buys about 70% of its oil and around a fifth of its LNG from the region. The Gulf supplies between 40% and 80% of seaborne crude bought by China, India, Japan and South Korea.
Iran has never previously closed the strait, despite threatening to do so several times, not least because the waterway is vital to its own exports. Even during the "tanker war" of the 1980s, when Iran and Iraq fought and 239 oil tankers were bombed, shipments did not slow and prices stabilised after an initial spike.
Between July 1987 and September 1988, during the Iran-Iraq war, America reflagged dozens of Kuwaiti tankers and escorted them through the strait with the help of some 30 warships. Convoys of two or three tankers and several naval vessels departed, on average, once a week.
Previous analysis by the European Central Bank estimated that a partial blockade of the strait could cause the euro zone to lose 0.7 percentage points of GDP growth and gain almost one percentage point of inflation in a single year—an estimate that did not contemplate a full-scale military conflict.
The Gulf states' vast hydrocarbon reserves make them ideal locations for firms that process raw materials. In addition to oil, 22% of the world's traded urea, 24% of its aluminium, a third of its helium and 45% of its sulphur pass through or originate in the Gulf region. The Gulf accounts for nearly 45% of global seaborne naphtha flows and 23-30% of exports of other key plastic inputs, including styrene and polyethylene. It also supplies 26% of the world's industrial diamonds (essential for cutting and drilling tools), 26% of its glycol (a paint ingredient) and 30% of its methanol (used in plastics, resins, chemicals and building materials). Iran is a significant supplier of semi-finished steel to Asia. Qatar produced 17 tonnes of helium per day at Ras Laffan—roughly a third of global supply—as a byproduct of liquefied natural gas production. The United Nations estimates that a third of global seaborne fertiliser trade passes through the strait. The Gulf is the source of 30-35% of the international trade in urea and around 20-30% of ammonia. Qatar Fertiliser Company, a state-backed firm, produces 14% of the world's urea. Countries including Kenya, Pakistan, Somalia, Sri Lanka and Tanzania each source more than a quarter of their fertiliser from the Gulf; for Sudan, the share exceeds half. Asia and Africa rely especially on Gulf fertiliser: it provided 71% of Thailand's urea imports in 2025, 67% of South Africa's and 41% of India's. There is no global system of fertiliser stockpiles, as there is for oil.
During the third Gulf war in early 2026, Iran declared the strait "closed" to shipping and began laying mines in the waterway. Last year some 15m barrels per day (b/d) of crude, equivalent to 15% of world output, plus another 4m b/d of refined oil products sailed through. The closure trapped about 15% of global oil supplies—roughly twice the disruption the world suffered in the 1970s. About a fifth of global LNG shipments were halted. The International Energy Agency announced the release of up to 400m barrels from emergency reserves, but this was only a temporary fix. The price of fertiliser surged, stoking fears of food shortages; a dearth of helium imperilled chip production; and sulphur shortages affected copper-smelting.
Overflowing storage forced oil companies across the Gulf to suspend production. If the strait remained closed until April and production took two months to recover, Goldman Sachs estimated annual hydrocarbon output could fall by 12-16% in Saudi Arabia and the UAE, with losses exceeding a quarter of annual production in Bahrain, Kuwait and Qatar. A Saudi pipeline could reroute some oil to Yanbu, a port on the Red Sea, but most Gulf oil was trapped.
Some analysts reckoned crude could surge to $150 or $200 a barrel if the strait stayed closed through March, a recipe for global recession and stagflation.
Some 46 fuel tankers sailed the passage every day in the weeks before the war, according to Vortexa, a market-intelligence firm. Since the conflict began, no more than five have done so on any day; on three days none appears to have made it through. At least 16 vessels have been struck in the Gulf region. Laden tankers are bunching up on the western side of the strait, empty ones on the east. China has tried to negotiate safe passage for its ships, so far to little avail.
The threat to shipping comes in many forms: ballistic and cruise missiles and drones in the air; fast attack boats armed with missiles or explosives on the surface; thousands of sea mines and unmanned vehicles beneath the waves; and divers who can place limpet mines on ships at anchor. American forces have sunk much of Iran's navy, including 16 mine-laying vessels, some of them small speedboats.
Donald Trump has offered military escorts for tankers, echoing Operation Earnest Will in the 1980s, when America reflagged Kuwaiti tankers and protected them in transit during the Iran-Iraq war. European countries and Pakistan are also talking of sending escorts. But shipping sources say the navy has declined repeated requests for protection. Chris Murphy, a Democratic senator, said after a classified briefing that military brass "don't know how to get it safely back open". American destroyers used for air defence are busy protecting aircraft carriers.
Experts point to the cautionary tale of Britain's failed campaign against the Ottomans in the first world war to force open the Dardanelles. Iran, too, has layered defences and commanding terrain. America's technological advantages are blunted in confined waters, where drones and missiles reach their targets more quickly. In the 1980s Iran sought to avoid all-out war with America; this time, it is already engaged in an existential war for regime survival. America is replacing wooden-hulled minesweepers with littoral-combat ships carrying mine-warfare "packages", including unmanned drones, though some worry these are unproven.
Oil prices, which had been around $70 before the war, peaked at nearly $120 a barrel in early March before fluctuating wildly on conflicting signals from Washington and Tehran.
India, China and Turkey appear to have cut deals with Iran to keep some supply lines open. India negotiated safe passage for two LPG tankers, which transited the strait on March 14th carrying 93,000 tonnes—roughly one day's supply. Subrahmanyam Jaishankar, India's foreign minister, suggested the agreements could serve as a template, though further movements would be negotiated ship-by-ship. As one of the tankers was crossing, a port in the UAE where another Indian tanker was loading oil was attacked by Iranian drones.
On March 14th Donald Trump demanded that Asian allies including Japan and South Korea send ships to help open the strait. He said he thought China "should help too." He appeared to U-turn days later, insisting America did "NOT NEED THE HELP OF ANYONE." On March 17th Anwar Gargash, the diplomatic adviser to the UAE's president, said his country might be willing to take part in a naval coalition, though its capabilities would be limited.
Before the war, Iran was estimated to have stockpiled around 6,000 mines of different types: moored mines that linger just below the surface and detonate when struck by a vessel, and more advanced devices that sit on the seabed and are triggered by a ship's magnetic or acoustic signatures. Though America has sunk many of Iran's mine-laying craft, commercial or fishing vessels can be used instead. "Any ship can be a mine-layer," points out James Foggo, a retired admiral.
The Pentagon's three-phased plan to reopen the strait involves first hunting down Iranian military assets—speedboats, missiles, drones and mines—threatening shipping; second, sweeping the strait for mines; and third, escorting tankers through. Each stage could take several weeks.
By late March 2026 American warplanes had pummelled Iran's shores. General Dan Caine, America's top soldier, said fighter jets had dropped 5,000-pound bombs to demolish underground bunkers storing anti-ship missiles. A-10 "Warthog" attack jets were sent to strafe Iranian speedboats. American forces said they had damaged or sunk more than 120 Iranian naval vessels and 44 mine-laying ships. Iran's Shahed-136 drones can fly more than 1,500km, allowing strikes anywhere in the strait or the Gulf from nearly anywhere in Iran. Iran's resolve may be greater than the Houthis': the regime is fighting for its survival. "They've been husbanding their resources for this purpose for decades," says Bryan Clark of the Hudson Institute. "They'll be able to continue this for as long as we're willing to do it."
In January 2026, with terrible timing, the US Navy scrapped its last Avenger-class mine-clearing ships based in the region. Two of the three littoral combat ships that replaced them were not in the Gulf and had to make their way from Asia. Their mine-clearing drones had not yet been used in battle and had suffered technical glitches in testing.
Escorting tankers would require dozens of drones, attack helicopters and fighters circling overhead, plus airborne warning and control aircraft. Maritime experts reckoned the navy would need a destroyer to accompany every couple of tankers. The navy had 14 destroyers in the region, but six were busy protecting aircraft-carriers; bringing more could take weeks. An American submarine sank an Iranian warship—America's first such attack since 1945.
On March 21st Donald Trump gave Iran an ultimatum: reopen the strait within 48 hours or face the bombing of its power plants. Iran's IRGC threatened to target Gulf countries' water-desalination facilities in response. Two days later Trump reversed himself, claiming "very good and productive conversations" about a possible deal; oil prices fell below $100 a barrel for the first time in nearly two weeks.
Marco Rubio, America's secretary of state, lamented that Iran's leaders "may decide that they want to set up a tolling system in the Strait". Naysan Rafati of the International Crisis Group calls this the "Ayatollbooth" strategy. It violates global norms of free navigation and could be copied by other belligerent states. Iran has allowed only a few tankers through, sometimes charging a reported $2m per ship.
By late March 2026 Iran had established a chokehold over the strait, proving both that it could strangle the waterway and that it would be agonisingly hard to loosen its grip. Iran's asymmetric warfare—missiles, cheap drones and perhaps mines against shipping—was keeping the superpower at bay. Oil prices hovered around $100 a barrel. Pakistan's government stood by to mediate between America and Iran. Donald Trump said he had offered Iran a 15-point plan for peace; officials in Tehran denied talks were under way. The Pentagon sent some of the 82nd Airborne Division to the region, suggesting escalation remained a possibility.
Two months after America and Israel began bombing Iran, traffic through the strait remained near zero and Brent crude futures exceeded $120 a barrel. Before the closure, 18.3m barrels per day (b/d) of crude and refined products exited the strait. Accounting for a trickle still getting through, plus extra volumes squeezed through the Saudi and Emirati bypass pipelines, the net supply deficit was around 13m b/d—over 10% of global consumption. Oil stocks fell to their lowest since satellite tracking began in 2018.
Saudi and Emirati spare capacity was trapped behind the blockade. American shale producers needed 3–6 months to ramp up and could add only 300,000–700,000 b/d initially; pipelines, storage and export terminals were already saturated. Russia could theoretically pump another 300,000 b/d but struggled to maintain existing output under Ukrainian drone attacks.
The IEA's 400m-barrel co-ordinated strategic-reserve release had delivered about 100m barrels by May, with a further 75m expected in May and June. Near-record volumes of crude that were already at sea when the war began provided a buffer of over 3m b/d, according to Morgan Stanley, but floating stocks of refined products were already depleted.
Commercial stocks were being drained at roughly 5m b/d. Frédéric Lasserre of Gunvor estimated refined products accounted for about half. Experts canvassed by The Economist estimated demand ran 3m–5m b/d below forecast in April: 10–15% of that from the Middle East (where airline traffic fell by two-thirds), over half from Asia (where the petrochemical industry ran at 60–75% capacity owing to naphtha shortages), and much of the rest from east Africa and eastern Europe.
Excluding China, Asian crude inventories had already dropped 13%, to 545m barrels, according to Kayrros, a satellite-tracking firm. Asian refineries slashed throughput by 3.5m b/d (12%); Neil Crosby of Sparta Commodities reckoned cuts could double by June. Indonesia, Pakistan and the Philippines were five or six weeks from petrol shortages; Australia similarly close to running out of diesel and jet fuel. East Africa was already at rock-bottom, with countries like Kenya and Mozambique living cargo to cargo.
In Europe, refineries configured predominantly for petrol struggled to replace lost diesel and kerosene imports from Russia, the Gulf and India. The IEA warned that Europe could face jet-fuel shortages by June. American diesel stocks fell 11% in five weeks as European buyers bid up cargoes from the Gulf coast.
Pump prices in America reached $4.20 a gallon on average, up from just under $3 before March. Prices doubled in Myanmar and rose 40–52% across south and south-east Asia. The spread between crude and both diesel and jet fuel soared to $50–80 a barrel, from $15–20 before the war.
China banned all kerosene exports; South Korea capped them; India raised taxes to discourage them. Indonesia capped fuel purchases at 50 litres a day; Sri Lanka at 15 litres and instituted a four-day working week. Myanmar restricted drivers to buying petrol every other day. Cambodia shut a third of its petrol stations. The Netherlands initiated the first phase of its oil-crisis plan; Slovakia and Slovenia capped fuel purchases. Argentina raised its ethanol-blending cap; Indonesia raised its biodiesel blend to 50% palm oil.
In mid-April 2026 Donald Trump imposed his own blockade to strengthen America's negotiating hand, trapping tankers taking as much as 2m barrels a day of Iranian oil to market. Nearly 2m tonnes of fertiliser were stuck behind the blockaded strait; if they did not start moving soon, many crops would miss their window for nourishment, causing yields to plummet and prices to rise.
Around April 8th 2026 a ceasefire was declared. Iran agreed to allow commercial shipping to resume, but signals were conflicting. Some 74 vessels transited the strait in the week ending April 5th, compared with fewer than 40 in the first weeks of hostilities. But that was still a trickle compared to the roughly 130 a day that typically made the passage before the war. Almost all ships getting through were tied to Iran or "friendly" countries. Iran required them to sail a peculiar route between Larak Island and the Iranian mainland, not through the main channel—implying it had laid mines in the main shipping lanes. The going rate for passage was said to be around $2m a tanker.
Over 700 commercial vessels remained stuck in the Gulf. Few risked a transit, given the shakiness of the ceasefire. Ships had to submit documents on ownership, management, financing, insurance and trading history to demonstrate no American or Israeli connections. Iran's foreign minister insisted safe passage "will be possible via co-ordination with Iran's armed forces and with due consideration of technical limitations"—conditions that did not apply before the conflict. Clarksons, a shipbroker, thought transit levels were "unlikely to return to pre-conflict levels in the near term". The two-week duration of the ceasefire discouraged shipowners from sending vessels into the Gulf, lest fighting flare again and trap them.
For the petro-monarchies, Iran's ability to shut the strait poses an existential threat; its desire to charge tolls smacks of extortion. Saudi Arabia and the UAE maintained a portion of exports using bypass pipelines (the Saudi one to Yanbu on the Red Sea, the Emirati one to Fujairah on the Gulf of Oman). Bahrain, Iraq, Kuwait and Qatar have no alternatives. Iraq and the autonomous Kurdish region hastily agreed to reopen the Kirkuk-Ceyhan pipeline (250,000 b/d capacity, a fraction of Iraq's pre-war 3.3m b/d exports). Iraq was also shifting some oil by road through Syria. Maisoon Kafafy of the Atlantic Council argued that Gulf states need a regionwide pipeline network "resilient by design", but this would take decades and tens of billions of dollars. And Iran's attack on the Saudi pipeline showed alternative routes are just as vulnerable to drones and missiles as tankers.
By mid-March Iran had shifted tactics from attacking vessels to targeting the sources of energy supply directly. It launched dozens of drones at Saudi oil fields, up from just a handful at the start of the war. In the UAE it attacked Fujairah, a big gas field and the Ruwais refinery, which can process nearly 1m b/d. After Israel bombed Iran's portion of the world's biggest gas field on March 18th, Iran targeted the processing plant on the Qatari side of the same field.
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