New Delhi: Iran’s parliament has approved a proposal to close the Strait of Hormuz, a critical global oil corridor, in a major escalation of tensions in the region and raising fears of severe disruption to global energy supplies. The final decision now rests with Iran’s Supreme National Security Council, according to state media reports.
The move came in the aftermath of US airstrikes on Iranian nuclear sites at Fordow, Natanz, and Isfahan. Revolutionary Guards commander and senior lawmaker Esmail Kosari said the closure is “on the agenda” and “will be done whenever necessary”.
The decision if approved will be catastrophic for oil-depended economies. A closure would send shockwaves through global markets, affecting everything from transport costs to food prices. While it is not the first time Iran has threatened to close the strait, but after the US attacks it is weighing its options.
Strategic maritime chokepoint
The Strait of Hormuz is a strategic maritime chokepoint through which nearly 20 per cent of global oil and gas shipments pass daily. It connects the Persian Gulf to the Arabian Sea and is just 33 kilometre wide at its narrowest point, with 3-kilometre-wide shipping lanes in each direction.
The closure could impact major oil exporters, including Saudi Arabia, Iraq, the UAE, Kuwait, and Iran itself, as well as top importers like China and India. For India, about 2 million barrels per day of crude transit the strait.
Implications for India
While India has diversified its oil sources, including increased imports from Russia, the US, and Brazil, a closure could still trigger short-term price shocks as through Strait of Hormuz over one-third of its daily imports passes through. Analysts warn oil prices may cross $80 per barrel if the strait is blocked.
Gas supplies are less likely to be affected, as India’s major LNG suppliers, including Qatar, the US, and Australia, have alternative shipping routes.
