Iran “Closes” Strait of Hormuz, Report Claims! Who Will Be Worst Affected as IRGC Blocks Critical Chokepoint?

After the US and Israel launched a massive attack on Iran, Iranian state TV reported the death of Supreme Leader Ayatollah Ali Khamenei, as well as the deaths of his daughter, son-in-law, and granddaughter. “Khamenei, one of the most evil people in History, is dead,” Trump had said hours earlier, on his Truth Social platform.

“Heavy and pinpoint bombing… will continue, uninterrupted throughout the week or, as long as necessary to achieve our objective of PEACE THROUGHOUT THE MIDDLE EAST”, Trump wrote. The country’s judiciary confirmed that the chief of the Revolutionary Guards, General Mohammad Pakpour, and another top security adviser, Ali Shamkhani, were also “martyred” in the strikes. Israel’s military said it targeted multiple sites where senior Iranian officials had gathered in Tehran, and launched strikes against Iranian missile launchers. In response to the US and Israeli attacks, Iran’s Revolutionary Guards (IRGC) said they targeted the US Fifth Fleet in Bahrain and other American bases in the Gulf, after launching a first wave of missile and drone attacks at Israel. After Khamenei’s death, the IRGC said that they would launch the “most ferocious” operation in history against Israel and US bases.

Iran’s Revolutionary Guards also moved to close the Strait of Hormuz, a vital waterway through which much of the world’s oil and gas passes. The IRGC Navy has announced via VHF radio that no vessels are permitted to cross the Strait of Hormuz, effectively declaring the critical maritime chokepoint closed, according to a Reuters report. The announcement was reported by Tehran Times on social media. Two ships were attacked in the Strait of Hormuz on Sunday, maritime security agencies said. One ship, off the coast of Oman, was “struck by an unknown projectile above the waterline. Although the engine room was originally reported as on fire, it has now been reported that the fire is under control,” the British maritime security agency UKMTO said in a statement. In a separate incident, another vessel was “struck by an unknown projectile, causing a fire. The fire has been extinguished, and the vessel intends to continue on its voyage,” UKMTO said.

The private maritime security company Vanguard Tech indicated that the second vessel, a tanker, was located approximately 17 nautical miles northwest of Mina Saqr in the United Arab Emirates. On Sunday, Iranian state television said an oil tanker was “sinking” after being struck while transiting the Strait of Hormuz. “The fate of the offending oil tanker that was struck while attempting to illegally pass through the Strait of Hormuz is that it is now sinking,” state TV reported, without elaborating. Images broadcast by the television station showed thick black smoke billowing from the burning tanker. The Strait of Hormuz is a narrow maritime passage between Iran and Oman. It is one of the most strategic global energy pressure points, and any disruption here will adversely impact Asia, Europe, and beyond. At its narrowest point, it is only 33 km wide. The navigable lane is not more than 10 km, with about 3 km of passage for outbound traffic and 3 km for inbound traffic. The northern side of the strait is controlled by Iran, which has hilly terrain. From these hills, Iran can effectively monitor traffic flowing through the strait using radar. It can also deploy air defence and surface-to-surface weapons on these mountains to control who enters or exits the strait.

Geographic & Strategic Overview of the Strait of Hormuz

The geographic importance of this strait cannot be overemphasized, as global shipping lanes are completely dependent on it. The southern part of Hormuz belongs to Oman, and the Musandam Peninsula juts into the strait, narrowing the passage even further. Very large naval ships cannot manoeuvre effectively in the strait because of the shallow depth. This limits naval vessels’ ability to conduct tactical operations, thereby restricting their options as they enter this choke point. This geography favors asymmetric warfare. A smaller power does not need naval superiority to cause disruption; it only needs to create uncertainty.

Why is the Strait of Hormuz so Important?

This is the world’s most important strategic energy chokepoint in human history. The average daily energy flow through this strait, in terms of crude oil and condensate, is about 21 million barrels, which is roughly 20% of global consumption. When it comes to LNG, about 90 million tonnes move annually, accounting for nearly 25% of global trade. Apart from these, refined petroleum products also move in large quantities through Hormuz every day. To put this in perspective, one in every five barrels of fuel consumed in the world passes through this strait.

Why Pipelines Cannot Fully Replace the Strait

Saudi Arabia’s East–West pipeline carries oil to the Red Sea, but it is insufficient to replace all Gulf exports. The UAE’s Fujairah pipeline bypasses Hormuz, but it serves only a fraction of UAE exports. Kuwait and Qatar remain completely dependent on this strait. Simply put, pipelines can offset Hormuz’s strategic importance to some extent, but they cannot completely replace it, at least not in the near future.

Nations that Depend on the Strait of Hormuz

Let us look at how oil-exporting countries of the Gulf would be affected. Saudi Arabia exports millions of barrels per day, and oil revenue funds infrastructure, development, social spending, Vision 2030 reforms, and government salaries. Any disruption in oil flow outside the country will severely affect these sectors. Iraq relies on oil for over 90% of its government revenue and social spending. Nearly 100% of Iraq’s exports depend on the Strait of Hormuz. Qatar is the world’s largest liquefied natural gas exporter. It’s gas heats homes, powers factories, and generates electricity across Asia and Europe. Any disruption to Qatar’s gas exports will have a serious impact on the ground.

Major Energy Importers

India

India is one of the most exposed countries to any disruption of oil trade through this region. India imports about 80–90% of its fossil fuels, including crude oil, and over 50% of its natural gas requirements from the Middle East. Middle Eastern supply dominates due to proximity and compatibility with refining. Even a $10 increase in crude prices significantly worsens India’s trade deficit.

China

China is the world’s largest consumer of crude oil. Nearly 50% of its crude flows through this region. China maintains strategic reserves, but they are not infinite. The Chinese economy, its stability, and the well-being of its people are heavily dependent on uninterrupted oil imports.

Japan and South Korea

Japan and South Korea have no domestic oil or gas production. Both of them are completely dependent on Middle Eastern energy supplies. They hold large strategic reserves of around 120 days; however, these reserves are designed for emergencies, not prolonged crises.

How Energy Dependence Translates into Economic Vulnerability

Oil’s Role Beyond Transport

Oil drives nations. Diesel-powered agricultural pumps and tractors depend entirely on fuel. Any price fluctuation has a cascading effect on agricultural output, which directly impacts the common man. It also affects foreign reserves and inflation. Aviation fuel plays a major role in transporting people and goods. Any increase raises ticket prices and fuels inflation.

India’s Inflation Sensitivity

India’s inflation sensitivity to increases in crude prices cannot be overstated. Food inflation, driven by higher transportation costs, directly affects the Indian government’s budgets and subsidies. Household spending power declines sharply as oil prices rise. Historically, crude price shocks in India have weakened the rupee, forced tax adjustments, and widened fiscal deficits, severely impacting the country’s annual budgets.

Military Reality: Why the Strait Is Hard to Secure

Militarily, Iran enjoys substantial asymmetric capabilities. It can render warships and even aircraft carriers ineffective through fast-attack boats, anti-ship missiles, and mining the region. This could prevent American vessels from entering or exiting Hormuz.

There are also intelligence reports suggesting Iran has developed submarine-launched anti-ship missiles in addition to torpedoes, with ranges sufficient to sink very large crude carriers. All of this gives Iran a tremendous asymmetric advantage.

VLCCs as Strategic Targets

VLCC (Very Large Crude Carrier) is an ideal tool for disruption. It is over 300 meters long and must move slowly in confined, shallow waters like Hormuz. It can carry up to 2 million barrels of crude. An attack could spill oil, contaminate the region, and make it unusable for months. Such a catastrophe is something neither America nor the world is prepared to accept. In many ways, this would be worse than a nuclear attack.

Scenario Analysis: If One or Two VLCCs Are Sunk or Disabled

Physical Disruption

A single disabled VLCC in the narrow lane can obstruct traffic in both directions. As discussed earlier, the navigable width is only about 10 km. This would force ships to reroute, sometimes taking weeks or months to reach their destinations. Ships west of the strait could remain tangled, unable to exit Hormuz. Salvage operations would be extremely slow due to the risks of oil spills and explosive hazards. The narrow corridor further complicates salvage efforts.

Insurance and Commercial Reaction

The shipping industry is entirely dependent on insurance. As risk rises, insurance premiums spike sharply, and insurers may even withdraw coverage from the region. Ship owners would then refuse to enter the area, as operating without insurance would be commercially unviable. Even without a formal blockade, shipping would be severely affected.

Immediate Impact on Global Oil Markets

A spike of up to 50% in global fuel prices is a realistic scenario. Panic buying by nations and consumers cannot be ruled out. Stock markets would plunge, especially in countries fully dependent on imported energy.

Specific Impact on India

Fuel Prices and Public Pressure

An increase in crude prices would directly translate into higher petrol and diesel prices. This would provide ammunition to opposition parties and intensify political pressure on the ruling government to cut taxes, thereby increasing subsidy burdens. In extreme cases, such pressures could even lead to the fall of a government. Since India does not hold large strategic reserves, the impact would be immediate and severe.

External Sector Stress

Higher oil prices would increase import bills, weaken the rupee, and place heavy pressure on foreign exchange reserves. The RBI would struggle to manage inflation, and in extreme cases, India could slip into recession. This could lead to law-and-order issues and even malnutrition, reminiscent of conditions during the Second World War.

Strategic Reserves: A Temporary Buffer

India’s reserves cover only a few weeks of consumption. While higher prices may slightly reduce demand, the reduction would not be sufficient to withstand prolonged disruption. Indian Railways would also be affected, affecting rural India’s access to food, medicine, and essential supplies.

Can the Strait be Secured?

Naval Presence

International intervention appears to be the only viable solution. The United Nations has repeatedly demonstrated its inability to control such situations and has long been perceived as a toothless tiger. Countries dependent on fossil fuels are gradually expanding mitigation strategies by investing in renewable energy, increasing strategic reserves, and seeking alternative pipelines. India, for instance, is looking toward Russia for energy. These measures will take time to yield results. Until then, the Strait of Hormuz remains a major fault line. The Strait of Hormuz is critically important because the global economy depends on the energy that flows through it. It is extremely fragile, both geographically and politically. For India and other Asian countries that are heavily dependent on imported energy, there is little control over the actions of the US, Israel, or Iran.