What to know about the Strait of Hormuz

A key waterway for global shipping

The Strait of Hormuz is a bending waterway, about 33 kilometers (21 miles) wide at its narrowest point. It connects the Persian Gulf to the Gulf of Oman. From there, ships can then travel to the rest of the world. While Iran and Oman have their territorial waters in the strait, it's viewed as an international waterway all ships can ply. The UAE, home to the skyscraper-studded city of Dubai, also sits near the waterway.

The strait long has been important for trade

The Strait of Hormuz through history has been important for trade, with ceramics, ivory, silk and textiles moving from China through the region. In the modern era, it is the route for supertankers carrying oil and gas from Saudi Arabia, Kuwait, Iraq, Qatar, Bahrain, the UAE and Iran. The vast majority of it goes to markets in Asia, including Iran's only remaining oil customer, China.

While there are pipelines in Saudi Arabia and the UAE that can avoid the passage, the U.S. Energy Information Administration says “most volumes that transit the strait have no alternative means of exiting the region.”

Threats to the route have spiked global energy prices in the past, including during the Israel-Iran war in June.

Mounting attacks

The United Kingdom Maritime Trade Operations center, run by the British military, says it has received 20 reports of incidents affecting vessels in and around the Persian Gulf, Strait of Hormuz and Gulf of Oman as of Thursday. It lists 16 attacks and four others as “suspicious activity,” involving tankers, tugs, cargo and other vessels.

Is the strait closed?

The strait is effectively but not officially closed as Iran targets energy infrastructure and traffic through the strait.

Previously, Iran temporarily shut down parts of the strait in mid-February for what it said was a military drill. In past times of tension and conflict, Iran has at times harassed shipping though the narrows, and during the 1980s Iran-Iraq war, both sides attacked tankers and other vessels, using naval mines to completely shut down traffic at points. But Iran up until now not carried out repeated threats to close the waterway altogether since then, even during last year’s 12-day war when Israel and the U.S. bombarded Iran’s key nuclear and military sites.

The U.S. is rolling out ship reinsurance in the region through the U.S. International Development Finance Corp., a government agency that partners with the private sector to back global investment projects, in an effort to get ships moving through the strait again.

Political risk insurance is a type of coverage intended to protect firms against financial losses caused by unstable political conditions, government actions, or violence. Marine insurers had been canceling or raising rates for insurance in the region.

The U.S. reinsurance facility will insure losses up to approximately $20 billion on a rolling basis, according to the International Development Finance Corp., focusing on insuring cargo and physical damage to a ship’s structure and operating machinery to start.

Trump said that, if necessary, the U.S. Navy would escort oil tankers through the strait, though that has yet to happen.

There is a French-led initiative in the works that could involve European and non-European nations helping to escort tankers with the aim of gradually reopening the strait “as soon as possible after the most intense phase of the conflict is over.”

Mine fears

On Tuesday, Trump said the U.S. military “completely destroyed” 16 inactive Iranian mine-laying ships.

Trump in his social media post added that there would be “more to follow,” suggesting the U.S. would target additional mine-laying vessels.

The announcement of the targeting of the ships came soon after two other social media posts by the U.S. president in which he said he has no reports of Iran putting explosive mines in the strategic waterway, but also warned Tehran if mines were laid he wanted them immediately removed.

Global shippers suspend operations

Global shippers have issued service alerts saying they have suspended operations in the area. Danish shipping company Maersk, the world’s biggest shipping company, said Sunday it is suspending all vessel crossings in the Strait of Hormuz until further notice. Other ocean carriers including Hapag-Lloyd, CMA-CGM and MSC made similar announcements.

“Those ships that got stuck in the Gulf are not going anywhere," said Tom Goldsby, logistics chairman in the Supply Chain Management Department at the University of Tennessee. "There’s also a whole host of ships that were heading into the Gulf to replace them, and of course they’re anchored or going elsewhere now."

There are currently about 400 oil and product tankers idle in the Gulf, and one oil tanker passed through the Strait of Hormuz without incident on Monday, according to data from the website MarineTraffic.

Moves to free up oil

As the Strait of Hormuz remains at a standstill, a group representing many of the world’s wealthiest countries said it will release the largest volume of emergency oil reserves in its history. The International Energy Agency said it will make 400 million barrels of oil available from its members’ emergency reserves, which is more than double the 182.7 million barrels that the IEA’s 32 member countries released in 2022 in response to Russia’s full-scale invasion of Ukraine.

And the White House said it is considering waiving Jones Act requirements, although the action has not been finalized, White House press secretary Karoline Leavitt said in a statement.

The 1920s law is often blamed for making gas more expensive. It requires goods shipped between U.S. ports to be moved on U.S.-flagged vessels, and is designed to protect the American shipbuilding sector.

Temporarily waiving the requirement could “ensure vital energy products and agricultural necessities are flowing freely to U.S. ports.” The action has not been finalized, she said.