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At least 16 vessels have reportedly been damaged, struck, or hit by attacks in the Strait of Hormuz between February 28 and March 22
The ships are stranded close to the Strait of Hormuz. (Image for representation: AFP)
Is the Strait of Hormuz open or shut? This question has no “yes’or ‘no’answers for now. With US President Donald Trump’s ultimatum and military movement, Iran’s defence and retaliation attacks, the Strait of Hormuz is anything but “open”. In fact, with the war involving the United States, Israel and Iran now moving to the waters, global economies have started feeling the heat.
The Strait of Hormuz has remained choked since the war began on February 28. At least 16 vessels have reportedly been damaged, struck, or hit by attacks in the Strait of Hormuz between February 28 and March 22, according to data from the UK Maritime Trade Operations (UKMTO). With the US now deploying more military might in the skies above Hormuz and Iran refusing the back down, the free reopening of Hormuz looks like a distant dream.
What Is Happening In The Strait Of Hormuz?
Donald Trump had on Saturday issued a 48-hour ultimatum to Tehran, saying that Washington could “obliterate” Iran’s power facilities if it does not reopen the key shipping route.
Iran, on the other hand, claimed the Strait of Hormuz was open, but not for “enemies” or the “allies of enemies”. However, on Sunday, Iran warned it will completely shut down the Strait of Hormuz if the United States follows through on threats to strike its power plants. According to Iran’s military command, Khatam Al-Anbiya, the strait would remain closed until damaged Iranian power infrastructure is rebuilt.
“If the United States’ threats regarding Iran’s power plants are carried out… the Strait of Hormuz will be completely closed, and it will not be reopened until our destroyed power plants are rebuilt,” the command said in a statement carried by state television.
The US has deployed A-10 Warthog attack planes and AH-64 Apache helicopters to the Strait of Hormuz to counter Iranian threats and reopen the strategic waterway, the Wall Street Journal reported. These assets are engaged in a “hunt and kill” mission targeting Iranian fast-attack boats, mine-laying vessels, and one-way attack drones that have disrupted global oil and LNG shipments.
According to fresh reports, the US and Israel have warned of “weeks” of more fighting, even as the global energy markets are taking a hit.
With the end of the war not in sight, analysts say the only solution to easing the stress on the energy crisis is the reopening of the Strait of Hormuz.
What Has Been The Impact On Global Energy Markets So Far?
The US-Israel-Iran war and the effective closure/disruption of the Strait of Hormuz had severely constrained global energy supply routes, sharply boosting oil and gas prices and forcing unprecedented strategic reserve releases. This in turn exacerbated inflationary pressures, weighed on global growth prospects, and increased volatility in financial markets and supply chains around the world.
The Hormuz waterway normally carries about a fifth of the world’s oil supply — roughly 20 million barrels a day — along with a major share of liquefied natural gas. As fighting intensified and insurers pulled back coverage, vessel traffic through the strait fell by around 90 per cent, sharply restricting energy flows from the Gulf. By mid-March, oil exports from the region had dropped from roughly 25 million barrels per day to about 10 million, creating one of the most severe supply squeezes in decades.
Energy prices reacted almost instantly. Brent crude surged past $100 per barrel and briefly touched about $126 — a level not seen in years — before settling into highly volatile trading above $110 as of March 23. Natural gas markets were rattled too. European benchmark gas prices nearly doubled at one stage, jumping from around €30 per megawatt-hour to over €60 before easing slightly. The strain was compounded when Qatar’s energy exports were disrupted, putting roughly a fifth of global LNG supply at risk and tightening fuel availability across Asia and Europe.
Governments scrambled to contain the damage. The International Energy Agency coordinated the release of an unprecedented 400 million barrels from strategic petroleum reserves to calm markets and prevent deeper shortages. Even so, higher fuel and transport costs began feeding into everyday prices worldwide. Analysts estimate that if disruptions persist, the shock could add roughly 0.8 percentage points to global inflation, especially hurting energy-importing economies.
Financial markets have also felt the strain. Major stock indices swung sharply as investors weighed the risk of prolonged conflict and slower growth. Shipping costs and war-risk insurance premiums climbed steeply, disrupting trade routes and delaying cargoes. Industries that depend heavily on fuel — from aviation and logistics to fertilisers and petrochemicals — faced rising input costs and tighter margins. Economists now describe the situation as the most serious global energy supply disruption since the oil crises of the 1970s, with ripple effects spreading far beyond the Middle East.
What Will Happen If Strait of Hormuz Remains Shut For A Month?
If the Strait of Hormuz remains shut for a month, the global energy system would face a severe shock, with oil and gas prices spiking sharply and inflation flaring up in many countries. International Energy Agency chief Fatih Birol has warned that the war in the Middle East could see the world face its worst energy crisis in decades, describing the situation as “very severe”.
Impact on oil markets and inflation
With the strait sealed, tankers carrying crude from Saudi Arabia, Iraq, Kuwait, the UAE, and Qatar would be stranded or forced to reroute at much higher cost, creating a supply crunch. Even if Gulf producers partially compensate via pipelines to the Red Sea, those routes can only handle a fraction of the usual flow — around 4.7 million barrels per day versus more than 20 million normally passing through Hormuz. However, with the Gulf Energy infrastructure hit in the war crossfire, chances if this are close to none. This imbalance would push oil prices higher, feeding through to petrol, diesel, and aviation fuel, and raising transport and production costs across the global economy. As Vandana Hari, founder of Vanda Insights, notes, a closure “will have a ripple effect for weeks if not months,” meaning a month‑long shutdown would lock in elevated prices and inflation for a sustained period.
Effects on global trade and shipping
Marine insurers and shipping companies would face steeply higher premiums and longer voyage times, since the alternative route around the Cape of Good Hope adds roughly two weeks and 6,000–8,000 extra nautical miles to voyages from the Gulf to Europe or the Americas. Analysts estimate that rerouting multiplies transport costs by around 50–100 per cent, costs that ultimately show up in higher consumer prices. Major importers such as India, China, and Japan would feel this acutely, as higher crude and LNG prices widen current‑account deficits and put pressure on currencies and interest‑rate policy. Several analysts warn that the “worst‑case scenario” of a sustained blockade could “trigger the worst oil supply shock in history,” underscoring how deeply a month‑long closure would rattle financial markets and trade flows.
Regional and geopolitical fallout
Iran itself would suffer economically, because even if it triggers or enforces the closure, its own oil exports would be cut off, depriving its government of vital foreign‑exchange revenue. Analysts argue that “prolonged closure of the strait would eliminate Iran’s primary source of export income,” making the strategy self‑damaging over time.
Is There A Way Out?
Several major economies have publicly backed the reopening of the Strait of Hormuz but are treading carefully on military involvement, stressing diplomacy and maritime safety over combat operations. In France, President Emmanuel Macron made Paris’s position explicit, saying France is “not party to the conflict” and therefore would “never take part in operations to open or liberate the Strait in the current context.” Instead, France has supported coordinated international efforts aimed at securing commercial navigation once conditions stabilise. Spain has struck a similar note. Prime Minister Pedro Sánchez warned that disruption in Hormuz is “a global energy security threat” that demands de-escalation and diplomacy, signalling Madrid’s reluctance to join any force-led mission while backing collective political pressure to restore safe passage.
Japan, heavily dependent on Gulf energy supplies, has also balanced concern with caution. Prime Minister Fumio Kishida emphasised the importance of stability in the waterway, stating that “ensuring the safety of maritime routes is vital for Japan and the international community.” However, Tokyo stopped short of committing naval forces under current legal and security constraints, instead joining European partners in a joint statement expressing readiness to support “appropriate efforts” to safeguard shipping. These positions reflect a common thread among US allies: strong support for reopening the Strait of Hormuz and protecting energy lifelines, but clear resistance to being drawn directly into active military operations.
March 23, 2026, 10:34 IST
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