The U.S. and Israeli attacks on Iran are focusing attention on the Strait of Hormuz, a narrow but strategically vital waterway in the region that serves as a key artery for global oil shipments.
The passage of oil tankers and other commercial ships has all but halted in the strait, sparking concerns that a prolonged conflict in the region could constrain global oil supplies, according to economists. Crude prices, which traded in the mid-$60 range in the days before the start of military operations on Feb. 28, temporarily soared above $100 a barrel for the first time since 2022.
“The combination of an escalating conflict (including Israeli attacks on Iranian fuel depots), the ongoing disruption of Hormuz and announcements of producer shut-ins indicates the crisis is unlikely to be resolved any time soon,” energy analysts with Eurasia Group, a political risk consulting firm, said in a March 9 report.
Here’s what to know about the Strait of Hormuz.
What is the Strait of Hormuz?
The strategic sea passage, located on Iran’s southern border, connects the Persian Gulf to the Gulf of Oman and the Arabian Sea. Long an important commercial trade route, the Strait of Hormuz ordinarily enables the flow of about 20% of global oil — roughly 15 million barrels of crude per day — along with liquefied natural gas shipments. Experts describe it as a strategic “choke-point” for crude.
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The strait — almost 100 miles long and 21 miles wide at its narrowest point — allows the world’s largest vessels to transport oil and gas from the Middle East to China, Europe and the U.S. Most of that crude comes from Saudi Arabia, the United Arab Emirates, Iraq, Kuwait, Qatar and Iran.
What is happening in the Strait of Hormuz?
The Iran war has brought the passage of oil tankers through the strait to a virtual standstill. As a result, oil prices have surged on concerns that a prolonged disruption of crude supplies in the region could sharply boost energy costs, including U.S. gas prices.
“It is de facto closed in that no one dares to go through,” Arne Lohmann Rasmussen, chief analyst at Global Risk Management, a provider of energy market insights, told CBS News. “You can be attacked, and you can’t get insurance or it is extremely expensive, so you have to wait until the security situation is better.”
“If oil and gas coming from the strait is cut off, that has significant ramifications for the market,” he added. “While there is no physical blockade, threats from the Iranians, plus drone and missile attacks, mean tankers are not going through the strait.”
A critical question moving forward is the duration of the war and how long the strait remains too dangerous to traverse, analysts said.
“If the reduction in tanker traffic continues for a week or so, it will be historic. Beyond that, it would be epochal for the oil market with prices rising to ration scarce supply and impacts in financial markets,” S&P Global head of crude oil research Jim Burkhard said in a report.
How high could oil prices rise if the strait remains closed?
Energy experts said an extended conflict in Iran that locks up the Strait of Hormuz could keep oil prices above $100 barrel, driving up gasoline and other energy prices.
As of March 9, the national average gas price in the U.S. had jumped to $3.45 per gallon, up more than 51 cents over the last week and roughly 42 cents from a year ago, according to tracking service GasBuddy.
“In just a week, consumers have seen gasoline prices surge at one of the fastest rates in years after oil prices spiked following U.S. strikes on Iran and the effective closure of the Strait of Hormuz,” Patrick De Haan, head of petroleum analysis at GasBuddy, said in a report. “With additional attacks across the Middle East over the weekend pushing oil above $100 per barrel for the first time in years, fuel markets are now rapidly recalibrating to the risk of prolonged disruption to global supply flows.”
That said, Iran could struggle to indefinitely throttle ship traffic through the Strait of Hormuz as the U.S. and Israel degrade the country’s navy and other military capabilities, according to analysts. Blocking Iranian oil from being exported to markets overseas would also badly damage the company’s fragile economy, experts note.
To address such concerns, President Trump on March 3 said the U.S. International Development Finance Corporation would provide insurance to all ships passing through the Persian Gulf. Mr. Trump also said the U.S. Navy would escort tankers through the Strait of Hormuz, if necessary.
What has President Trump said about the Strait of Hormuz and oil?
In a phone interview with CBS News on Monday, March 9, Mr. Trump said the United States “could do a lot” about the strait and threatened Iran if it inhibits the waterway. The president also said, “The war is very complete, pretty much.”
“They’ve shot everything they have to shoot, and they better not try anything cute or it’s going to be the end of that country. … If they do anything bad, that would be the end of Iran and you’d never hear the name again,” he said.
The president also said on March 9 that the strait was open and claimed ships had been entering the strait, but said he was still “thinking about taking it over.”
Speaking later that day to reporters at his Miami-area golf club, Mr. Trump said he doesn’t expect the war to end next week, but “soon.”
The president said Iran will get hit “at a much, much harder level” if Iran does anything to stop the world’s oil supply, saying: “I will not allow a terrorist regime to hold the world hostage and attempt to stop the globe’s oil supply.”
Mr. Trump reiterated that the U.S. is offering political risk insurance to any tankers in the Persian Gulf, and the U.S. could escort tankers through the strait if needed.
“If they do anything, the price will be incalculable,” the president said of potential Iranian operations against oil tankers.
Are there alternatives to the Strait of Hormuz?
Oil that ordinarily would pass through the Strait of Hormuz by ship could be exported via other routes.
Those include the East-West Pipeline, also known as Petroline, a nearly 750-mile-long pipeline in Saudi Arabia that delivers oil to ports on the Red Sea. Shipments could also be diverted to the Abu Dhabi Crude Oil Pipeline, a roughly 400-mile pipeline in the United Arab Emirates that transports oil to a facility on the Gulf of Oman.
Yet such alternative routes can only accommodate a fraction of the volume of oil that ordinarily passes through the Strait of Hormuz on a daily basis, according to experts.
David Oxley, chief climate and commodities economist at Capital Economics, said in a note to investors: “From an energy market perspective, the impact on energy flows from the Middle East will be dictated by two key variables: a) how long the Strait of Hormuz remains closed, and; b) the extent to which potential damage to energy infrastructure in the region constrains energy exports in the future, even when/if shipping through the strait resumes.”
