Israel-Iran War: What is Strait of Hormuz? Will Iran block it? It may impact India by...

Being unable to fight the US directly, will Iran retaliate by choking the Strait of Hormuz? Can the Islamic Republic push Washington to its back foot by blocking the most important waterway, through which more than 20% of world petroleum and gas exports transit? Will this move also hit Tehran's closest ally China? How will India be impacted by a possible blockade of the Strait of Hormuz? These questions came to the surface after the US bombed the Iranian nuclear sites of Natanz, Isfahan and Fordow Saturday. Tehran can not fight the US, but it can certainly give it an economic blow. Will it? 

What is Strait of Hormuz?

The waterway that connects the Persian Gulf to the Gulf of Oman is called the Strait of Hormuz. Iran lies on its north coast while the Musandam peninsula is located on its south coast. It is shared by the United Arab Emirates and the Musandam Governorate, an exclave of Oman. The strait is about 167 km long, and 39 km wide, with the narrowest width of 21 km. Its importance can be gauged by the fact a third of the world's liquefied natural gas and almost 25% of total global oil consumption passed through the strait in 2019. According to the US Energy Information Administration (EIA), about 20 million barrels of oil, about one-fifth of daily global production, flow through the strait every day now.

Will price of crude oil skyrocket?

After the US bombed and destroyed the Iranian nuclear sites of Natanz, Isfahan and Fordow, the Iranian parliament voted to close the Strait of Hormuz a day later on June 22, 2025. It put the oil prices on fire. Brent crude, which was hovering between $60 and $75 in December 2024, skyrocketed to $80 per barrel in January this year. It was sold for $81 per barrel Monday, when the market opened for the first time after the bombing. The US bombing also hit the stock market as the futures fell. While Dow futures slipped 250 points, or 0.6%, S&P 500 futures tumbled 0.6%, and Nasdaq futures fell 0.7%.

Will Iran block Strait of Hormuz?

Experts believe, Iran is caught in a deep dilemma and it will be very difficult to reach a decision. China is the closest ally of Iran and it is also the biggest importer of Iranian crude oil. According to data supplied by ship tracking firm Vortexa, China bought more than 1.8 million barrels per day from Iran in the month of May. This is almost 90% of total Iranian oil exports. Besides, if the Strait of Hormuz is blocked, it will also hit the oil exports from Saudi Arabia, the United Arab Emirates (UAE), Oman, Iraq, Bahrain and Kuwait. 

How will it hit India?

India stopped buying crude oil from Iran after Tehran was slapped with the US economic sanctions and New Delhi moved closer to Washington for its own geostrategic needs. However, India imports 85% of its crude oil consumption and most of the carriers flow through the Strait of Hormuz. The cost of the crude oil will skyrocket now and experts think it may go to $90 per barrel or beyond. A barrel is equivalent to 159 litres or 42 gallons. India spent $242.4 billion on crude oil and $15.2 billion on LNG in 2024-2025. Its oil bill is most likely to go north, putting pressure on the Indian economy.