The Strait of Hormuz: Why is it so important and how does it affect oil prices?

Experts have raised fears of an economic shock as one-fifth of the world’s oil and gas passes through the Strait

Iran has threatened to close a major oil shipping route in retaliation for “devastating” US strikes on three of its nuclear sites - a move that could have a sharp impact on the global economy.

Tehran’s lawmakers voted to cut off the Strait of Hormuz, a trade route that sees one-fifth of the world’s oil and gas pass through it. The move has rattled investors, sending oil futures soaring by around 10 per cent since the US launched strikes on Iran.

It comes after seven US stealth bombers dropped 14 30,000-pound bunker-busting bombs on Iran’s nuclear facilities early on Sunday morning in an operation called ‘Midnight Hammer’.

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However, Iran’s parliament’s decision is not binding, and a final decision would have to be made by top Iranian security officials, according to state media.

So what is the Strait of Hormuz, and how could closing it affect global oil and gas? The Independent takes a look below.

What is the Strait of Hormuz?

The Strait of Hormuz lies between Oman and Iran and links the Gulf north of it with the Gulf of Oman to the south and the Arabian Sea beyond.

It is 21 miles (33 km) wide at its narrowest point, with the shipping lane just 2 miles (3 km) wide in either direction.

The strait, which lies in Iran’s territorial waters, sees around one-fifth of global oil supplies and a third of liquefied natural gas pass through it.

Why is the Strait of Hormuz important?

Between the start of 2022 and May 2025, somewhere between 17.8 million and 20.8 million barrels of crude, condensate and fuels flowed through the Strait every day.

The Organisation of Petroleum Exporting Countries (OPEC) members Saudi Arabia, Iran, the United Arab Emirates, Kuwait and Iraq export most of their crude via the strait, mainly to Asia.

The UAE and Saudi Arabia, which are opposed to Iran’s influence in the region, have sought to find other routes to bypass the strait.

Qatar, among the world's biggest liquefied natural gas exporters, sends almost all of its gas through the Strait.

President Donald Trump speaks from the East Room of the White House

How could Iran closing it affect global oil and gas trade?

Iran could deny access to the giant tankers that ferry oil and gas to China, Europe and other major energy-consuming regions, according to Bloomberg.

If this happened, oil prices would surge and potentially destabilise the global economy, according to the publication.

The European Union’s top diplomat, Kaja Kallas, warned on Monday that an Iranian closure of the Strait would be dangerous and "not good for anybody".

"The concerns of retaliation and this war escalating are huge, especially closing of the Strait of Hormuz by Iran is something that would be extremely dangerous and not good for anybody," she told reporters ahead of a meeting with EU foreign ministers.

What role could China play?

US Secretary of State Marco Rubio has called on China to encourage Iran not to shut down the Strait of Hormuz.

Speaking on Sunday, he told Fox News: “I encourage the Chinese government in Beijing to call them about that, because they heavily depend on the Straits of Hormuz for their oil.

"If they do that, it will be another terrible mistake. It's economic suicide for them if they do it. And we retain options to deal with that, but other countries should be looking at that as well. It would hurt other countries' economies a lot worse than ours."

He added that a move to close the strait would be a massive escalation that would provoke a response from the US.