In the sweltering heat of a West Asian summer, the waters of the Persian Gulf shimmer deceptively under the sun. But beneath the surface of these narrow seas lies a tension so volatile it could set ablaze the global order. The Hormuz Strait, a slender maritime artery just twenty-one nautical miles wide at its tightest pinch, serves as the lifeline for over a fifth of the world’s oil. Every day, massive tankers laden with crude pass through these waters, feeding the energy appetites of Asia, Europe, and beyond. It is here—between the jagged coasts of Iran and the Arabian Peninsula—that the tectonic plates of geopolitics grind against each other.
In recent weeks, a familiar yet dangerous rhythm has returned to the region. After the U.S. President Donald Trump dramatically announced a ceasefire between Iran and Israel following weeks of cross-border hostilities, few believed the guns would truly fall silent. Indeed, the ink on the announcement was barely dry before Iran resumed missile attacks, targeting Israeli installations and deepening the shadow of retaliation. As Israel contemplates a massive response, Tehran has chosen to escalate on another front, threatening to close the Strait of Hormuz.
Such a move would not be without precedent. Iran has often wielded the threat as a diplomatic cudgel. But never before has the regional atmosphere been so combustible. With Israel and Iran effectively in a low-intensity war, any act that disrupts the Strait of Hormuz would trigger shockwaves far beyond the Persian Gulf. From Washington to Beijing, from Moscow to New Delhi, every major power has a stake in keeping the oil flowing—and the strait open.
For the United States, the closure of Hormuz would represent a crucible of credibility. Though largely self-reliant in energy thanks to its shale revolution, the U.S. cannot remain unaffected by the global oil market’s convulsions. An abrupt spike in crude prices would quickly ripple through American consumers, businesses, and financial markets. Inflation, already a political headache in Washington, could spiral. But the implications stretch far beyond economics. The U.S. Navy’s Fifth Fleet, based in Bahrain, has long served as a guarantor of free navigation in these waters. To allow Iran to shut the gate to global oil would not only damage American prestige—it would invite challenges elsewhere, from the South China Sea to the Black Sea.
Strategically, the U.S. leadership would face stark choices. Any attack on U.S. or allied vessels would demand a military response. Yet Iran’s naval doctrine thrives on asymmetric warfare. Swarms of fast boats, sea mines, and coastal missile batteries make a conventional engagement perilous. Worse, a prolonged maritime standoff would risk entangling the U.S. in a broader regional conflict, one that could draw in non-state actors and ignite new fronts in Lebanon, Syria, and Iraq. Domestically, such a crisis would trigger intense debate. Some would demand restraint to avoid another Middle Eastern quagmire. Others would insist on decisive action to reaffirm American resolve. In either case, the Hormuz gambit would test Washington’s balance of power calculus.
Across the Atlantic, Europe would find itself caught between panic and paralysis. The continent has only just begun to recover from the energy shock of the Russia-Ukraine war. Gas supplies from Moscow have been throttled, and Europe’s search for alternative sources has made Gulf oil and LNG indispensable. If tankers from Kuwait, Qatar, and Saudi Arabia are delayed or destroyed, energy prices would skyrocket. Inflation, which European central banks have fought tooth and nail, would reemerge with a vengeance. Industries, from German chemicals to Italian manufacturing, could grind to a halt.
Politically, Europe would face a crisis of cohesion. Efforts to revive the Iran nuclear deal—already limping—would collapse. France, the UK, and Germany, once hopeful that diplomacy could tame Iran’s ambitions, would now be forced to back military responses they once opposed. European navies may be drawn into a coalition to safeguard maritime traffic, but domestic opinion remains wary of military entanglements. The spectre of NATO Article 5 looms, particularly if a European vessel is targeted. Yet the alliance’s appetite for war in West Asia remains low. Europe, once again, would be forced to act without a unified voice, divided between Atlanticism and appeasement.
In the Kremlin, however, the crisis may seem like an unexpected windfall. Russia, excluded from Western energy markets due to sanctions, has watched global oil prices with hawk-like attention. A spike in prices caused by Hormuz’s closure would pour billions into Moscow’s coffers, funding its war in Ukraine and blunting the impact of Western sanctions. With one eye on Tehran and another on Brussels, Moscow would likely straddle the line between arsonist and firefighter.
Officially, the Kremlin might offer to mediate, citing its close ties with Iran and its longstanding relationships with Arab states. Unofficially, Russian arms and intelligence support to Iran would likely continue, particularly in cyber warfare and drone technology. But there are risks for Russia, too. If the crisis escalates into a full-blown U.S.-Iran war, Russian interests in Syria could be jeopardised. Moreover, any conflict that reopens NATO’s cohesion could revive the kind of Western solidarity Moscow has sought to fracture. Thus, Russia’s role would remain ambiguous, reaping short-term profits while manoeuvring to avoid long-term blowback.
For Beijing, the stakes could not be higher. China’s meteoric rise has been powered in part by access to affordable energy. Nearly half of China’s oil imports flow through the Strait of Hormuz. Disrupting this flow would cripple factories, slow exports, and shake investor confidence. With its economy already grappling with structural slowdowns and financial tremors, China cannot afford a prolonged oil shock.
Yet China is also diplomatically entangled. Tehran is a key Belt and Road partner, and Chinese investments in Iranian infrastructure and ports have deepened in recent years. Simultaneously, Beijing has tried to cast itself as a global peacemaker, recently brokering a thaw between Saudi Arabia and Iran. A Hormuz crisis would expose the limits of this ambition. Without military reach in the Gulf, China is a hostage to events it cannot control.
In backrooms, Chinese officials would likely plead with Iran to refrain from closing the strait. Publicly, they might blame the West for provoking the crisis. Privately, they would scramble to secure alternative routes—from Siberian pipelines to expanded storage at home. But these stopgaps offer only partial relief. China’s exposure to Gulf oil is strategic, and the Hormuz crisis would force a reckoning: either develop blue-water naval capabilities or remain vulnerable to distant disruptions.
For Iran itself, the closure of Hormuz would be a desperate but deliberate act. Long isolated and heavily sanctioned, Tehran views escalation not as madness but as leverage. By threatening global oil flows, Iran hopes to extract concessions on sanctions, on Israel, and its nuclear program. It also serves domestic politics. The regime, under siege from economic hardship and internal dissent, thrives on external threats to rally nationalist sentiment.
But the gamble is enormous. A full blockade would almost certainly trigger a military response. Even limited harassment—like laying mines or seizing foreign vessels—could provoke retaliatory strikes. Iran’s economy, already teetering, would face further collapse. Yet from the perspective of Tehran’s hardliners, it is better to burn hot and fast than fade away quietly. In their eyes, closing Hormuz is not suicide—it is strategic brinkmanship.
Meanwhile, the Arab Gulf states—Saudi Arabia, the UAE, and Qatar—stand to lose everything. Their wealth, their economic models, and their political stability rest on one assumption: that oil can leave their ports unimpeded. A closure of Hormuz would shatter that assumption. Even the threat of closure raises insurance costs, erodes investor confidence, and injects volatility into local markets.
Saudi Arabia has responded by quietly coordinating with U.S. and British forces, stepping up naval patrols, and accelerating domestic energy diversification. The UAE, with its modern navy and special operations forces, may take a more direct role in maritime security. Qatar, playing host to major U.S. airbases, will be pivotal in any logistical buildup. Yet the psychological damage is already done. The Gulf monarchies, despite their wealth, have been reminded of their strategic fragility.
India, meanwhile, watches with a mixture of alarm and urgency. Over 60 per cent of its crude imports pass through Hormuz. A sustained disruption would torpedo its economy, raising fuel costs, widening the trade deficit, and unleashing inflation. Politically, the crisis could damage the ruling government’s credibility on economic management, particularly in a year of critical state elections.
India’s navy, well-versed in the Indian Ocean, is capable of escorting tankers and projecting power. But New Delhi is unlikely to engage militarily unless directly provoked. Instead, it will use diplomacy—reaching out to Washington, Tehran, and Riyadh—to cool tensions. India’s unique relationships with both Iran and Israel offer a rare platform for backchannel dialogue. It may also use the crisis to push for energy diversification, ramping up deals with Africa, Latin America, and Southeast Asia.
Millennium Challenge 2002, a massive war game simulation by the U.S. military, modelled a hypothetical closure of the Strait—most analysts interpreted the simulated adversary to be Iran. The results were stunning and controversial. Using a swarm-based, asymmetric maritime strategy, the Iranian side in the simulation managed to sink several U.S. naval vessels, achieving tactical surprise and victory despite inferior technology. The exercise forced planners to confront the uncomfortable reality that material superiority might not ensure control of the Strait.
This war game exposed deep structural vulnerabilities in the traditional American approach to maritime dominance. Iranian forces, operating under a decentralised, pre-emptive strategy, used small boats, suicide attacks, and electronic warfare to overwhelm superior U.S. assets. The simulation had to be reset after the initial ‘Iranian’ victory, raising questions about whether the rules of modern conflict had fundamentally changed. For strategic planners, the lesson was sobering: in a constrained maritime environment like Hormuz, conventional superiority can be blunted by innovation, speed, and the will to escalate first.
A 2008 article in International Security argued that Iran could successfully close the Strait for a month and that any U.S. attempt to reopen it would likely escalate the conflict into a broader war. However, a subsequent rebuttal in the same journal questioned the assumptions and proposed a much shorter closure duration, suggesting U.S. and allied naval capabilities could restore order within days. The debate highlighted a fundamental strategic uncertainty: closing Hormuz is easy; keeping it closed is not, but the cost of reopening it may be unacceptably high.
Iran has exercised this muscle in more subtle ways. In December 2011, the Iranian Navy conducted a ten-day exercise near the Strait. Rear Admiral Habibollah Sayyari declared that while the Strait would remain open during drills, Iran retained the capability to close it at will. The message was clear: closure was not a military problem—it was a political decision. The U.S. response was equally calibrated. Pentagon spokesman Captain John Kirby assured the world that American forces in the region could secure navigation, while experts like Suzanne Maloney of the Brookings Institution emphasised that the U.S. military could neutralise Iranian threats swiftly.
Yet this assurance was not without nuance. General Martin Dempsey, then Chairman of the U.S. Joint Chiefs of Staff, acknowledged that Iran had indeed invested in capabilities to block the Strait “for a while.” He added that the United States had developed countermeasures to defeat such moves. In other words, a contest for Hormuz would not be a short, surgical affair—it would be a complex, high-stakes confrontation involving missiles, mines, and maritime chokeholds.
Legal implications are equally thorny. According to Turkish maritime law expert Nilufer Oral, any Iranian move to block passage through the Strait would violate both the United Nations Convention on the Law of the Sea (UNCLOS) and the 1958 Convention on the High Seas. Passage rights, she argues, are not contingent upon geopolitical grievances or sanctions regimes. Only two exceptions allow a coastal state to lawfully impede transit: if a vessel threatens the sovereignty of a bordering state during passage, or if it violates foundational principles of the UN Charter.
However, the legal landscape is complicated by the fact that Iran is not a signatory to UNCLOS. Most Arab League and OPEC nations—including Saudi Arabia, Egypt, and Syria—have not ratified the treaty, nor have China, North Korea, or even South Korea. This patchwork of legal obligations limits the power of international institutions to enforce navigation norms, leaving enforcement to military and economic might.
As the world stares down the possibility of a closed Strait of Hormuz, the stakes have never been higher. Oil markets can tolerate risk, but not paralysis. A sudden halt in Gulf exports would send prices soaring past $150 a barrel, if not higher. Gasoline would become scarce. Airlines would curtail flights. Developing nations, unable to compete with richer countries for fuel, would suffer disproportionately. The global economy, already fragile, could spiral into recession.
But beyond economics lies the spectre of war. Maritime conflict is unpredictable. One miscalculated strike, one mistaken radar reading, and the world could be plunged into a conflict no one truly wants. Insurance premiums would skyrocket. Global shipping would slow. Currency markets would convulse, with oil-importing countries watching their currencies crumble while safe havens like the U.S. dollar and Swiss franc soar.
So, what are the options for the world?
First, diplomatic channels must remain open. Switzerland, Oman, and even India may serve as backchannel negotiators. The United States, despite domestic constraints, must be willing to talk to Tehran—quietly if not openly.
Second, a multinational maritime coalition must be established, not as a warfighting force but as a guardian of shipping lanes. Freedom of navigation is not just an American value—it is a global necessity.
Third, energy-importing nations must learn from this moment. Strategic reserves, energy diversification, and investment in renewables are no longer green dreams—they are national security imperatives.
Lastly, the world must understand that chokepoints like Hormuz are not relics of 20th-century strategy. They are flashpoints of 21st-century conflict. If diplomacy fails and the strait is closed, the blast radius will not be limited to the Gulf. It will reach Wall Street, the Bundestag, the Forbidden City, and Raisina Hill.
The Strait of Hormuz is still open. But in this season of fire and fury, it may not remain so for long.
Title image courtesy: India Today
Disclaimer: The views and opinions expressed by the author do not necessarily reflect the views of the Government of India and Defence Research and Studies
Article Courtesy: https://substack.com
