The Strait of Hormuz – the narrow waterway through which between 20% and 25% of the world’s seaborne oil normally passes – has been effectively closed for just over two months.
As tensions have escalated, Iran has restricted passage through the Strait, while the US has imposed a naval blockade on Iranian shipping, sharply limiting Tehran’s ability to export crude. On May 3, the US president Donald Trump announced Project Freedom, by which US warships would escort vessels from countries not involved in the conflict through the Strait. But some reports have suggested that Iran has since fired on several ships attempting to transit and the waterway remains effectively closed.
The immediate consequences are tankers stranded, prices surging, and Iran rapidly running out of places to store its oil. Analysts now warn that storage could fill within weeks, forcing producers to shut wells altogether.
