There is a structural reality about the modern global economy. The entire $35-trillion architecture of international trade that underpins the living standards of eight billion people flows, with remarkable concentration, through a handful of narrow waterways that are geographically irreplaceable and strategically indefensible in a durable way. As the Strait of Hormuz remains mostly closed on the account of the US-Israel war on Iran for over a month now, we are witnessing a controlled detonation of a most critical node in the global supply chain. As they always do, the shockwaves have begun rippling outwards instantaneously and indiscriminately.
Stretching approximately 167 km from the Persian Gulf to the Gulf of Oman and narrowing to a mere 33 km at its tightest point, Hormuz channels roughly 20 million barrels of crude oil and petroleum products every single day, nearly a fifth of global seaborne oil, alongside about 19 percent of the world’s liquefied natural gas. For the Gulf States, there is no meaningful bypass. The pipelines that exist—the East-West Pipeline across Saudi Arabia and the Abu Dhabi Crude Oil Pipeline—carry a fraction of Hormuz’s throughput and cannot substitute for a closure of the strait.
The US-Israeli strikes, predicated on the delusion that military power can be projected with surgical precision and zero systemic consequence, have instead detonated a time bomb buried in the foundations of world trade. The utterly predictable crisis in Hormuz is a learning, in real time and at immense cost, that no nation, however powerful, can sever the Gordian knot of interdependence without the blade swinging back to wound its own hand.
The deeper damage runs through supply chains. South Korea, which imports 97 percent of its energy, draws most of its oil and LNG directly from West Asia through Hormuz. South Korean giants Samsung and SK Hynix together control 67 percent of global dynamic random-access memory production and nearly 80 percent of high-bandwidth memory, a critical substrate of the global AI boom. Disrupting South Korea’s energy supply is, in effect, disrupting the semiconductor supply chain for every AI data centre on the planet.
There is Qatar. Its damaged LNG trains took about 12.8 million tonnes of annual capacity offline, at a potential revenue loss exceeding $20 billion a year, with repairs estimated to take 3-5 years. Qatar also produces a third of the world’s helium, an element irreplaceable in semiconductor fabrication; spot helium prices have already doubled. Supply chains are nested within supply chains, and Hormuz sits atop them all.
Yet, to frame this crisis as a Hormuz problem alone is to fundamentally misread the nature of the vulnerability. The global trading system rests on four major maritime chokepoints—the Strait of Hormuz, Suez Canal and Bab el-Mandeb, the Strait of Malacca, and Panama Canal—apart from 20-odd passages. The failure of any one node generates immediate, disproportionate consequences across others, as rerouted traffic overwhelms the alternative passages, port hubs and logistics chains.
Hormuz’s closure has already re-energised the Houthis: their declared intention to resume attacks on commercial shipping around the Bab el-Mandeb threatens to sever the Asia-Europe maritime corridor through the Suez. Between 2023 and 2025, Houthi interdictions reduced Suez traffic from over 26,000 vessels a year to roughly 13,000. The tonnage of ships transiting the Gulf of Aden had fallen 76 percent compared to late 2023. Compounded by Hormuz’s closure, Houthi attacks would force virtually all Asia-Europe trade to the Cape of Good Hope route—adding 10-14 days per voyage, with a typical cost premium approaching $400,000 per large container vessel on the East Asia-Europe route under EU Emissions Trading System charges alone, and insurance premiums that are already reflecting war-risk recalculations in real time.
Further east, the Strait of Malacca carries approximately 16 million barrels of oil per day and handles a quarter of global seaborne trade, including 45 percent of seaborne crude and 26 percent of global car shipments. At its narrowest, in the Phillip Channel, it is barely 2-3 km wide, with over 80,000-100,000 vessels transiting annually under International Maritime Organization’s traffic separation schemes and a mandatory under-keel clearance of 3.5 metres that caps laden very large crude carrier drafts to 20-21.5 metres.
This is what Hu Jintao described as the “Malacca dilemma”, to describe the vulnerability of a huge amount of critical Chinese imports passing through these straits. Nearly 80 percent of China’s oil imports pass through Malacca, a strategic dependency Beijing has long attempted to address through pipelines, port investments and naval capacity-building. None of it resolves the underlying concentration risk yet.
Vessels exceeding this Malaccamax standard must divert to the Sunda Strait, with its relatively deeper controlling depths of 20-30 metres, but with navigational hazards especially around Anak Krakatau or through the unplumbed and more distant Lombok Strait, which adds days to transit time. Fallback routes exist, but they are exactly that—fallbacks, not substitutes.
The Turkish straits—Bosphorus and Dardanelles—illustrate a different dimension of the chokepoint problem. Carrying approximately 3 percent of global seaborne trade, they appear numerically modest until one recalls that this includes roughly 20 percent of global wheat exports from Ukraine, Russia and Romania. The Bosphorus narrows to 700 metres and runs through the heart of Istanbul, carrying 40,000-50,000 vessels annually. Russia’s access to warm waters flows is exclusively through these straits controlled by Türkiye, a Nato ally. All other Russian naval facilities—Murmansk and the Kola Peninsula bases for its Northern Fleet, St Petersburg in the Baltic, Vladivostok adjacent to the Sea of Japan—suffer significant winter constraints.
The Panama canal, though carrying only around 2.5 percent of global seaborne trade, handles approximately 40 percent of all US containerised shipments, valued at $270 billion annually. The canal demonstrated its climate vulnerability graphically in 2023 and 2024, when severe droughts reduced freshwater reservoirs and forced transit restrictions.
The fundamental strategic lesson is one that ought to be self-evident to any government serious about its national interest in a deeply integrated global economy: no State can jeopardise a maritime chokepoint without inflicting economic damage on itself, its allies, its trading partners and ultimately the very international system upon which its prosperity depends.
The interconnectedness that globalisation built is not a weakness to be exploited; it is a mutual hostage situation. The unilateral hegemonic approach—the belief that one nation can dictate the terms of global commons access—fails because there is no such thing as a localised disruption in a globalised system.
Manish Tewari | MP, lawyer, former Union I&B minister and author of A World Adrift
(Views are personal)
(manishtewari01@gmail.com)