Iran closes the Strait of Hormuz; will Sri Lanka’s oil supply also be disrupted?

2026-03-01 - 05:17

Iran’s Islamic Revolutionary Guard Corps has announced that no vessel will be permitted to pass through the Strait of Hormuz. Iran’s Tasnim News Agency, reporting on the matter, stated that this move comes as Iranian armed forces continue retaliatory strikes against the United States and Israeli targets. The news agency also reported that Iranian attacks have so far damaged 14 US bases. Following joint strikes by Israel and the United States on Iran, the Middle East region has now turned into a tinderbox. All airlines flying to the Middle East have temporarily suspended flights, prioritising the safety of passengers and crew. In addition, several Middle Eastern countries have taken steps to close their airspace in response to the situation. With Iran now acting to close the Strait of Hormuz amid the ongoing tensions, the development has already begun to affect numerous countries around the world. Why is the Strait of Hormuz important? This narrow sea passage connecting the Persian Gulf and the Gulf of Oman is often described as the world’s “energy hub”. At its narrowest point, it is about 21 miles wide, while the navigable shipping lane is said to be only around 2 miles wide. It is also the principal, and effectively the only, sea route used to transport crude oil exported from Saudi Arabia, Iraq, the United Arab Emirates and Kuwait to global markets. Ownership of the Strait of Hormuz Many assume that it belongs solely to Iran, but this is not the actual situation. It lies between Iran to the north and Oman and the United Arab Emirates to the south. It is also said that most of the shipping lanes fall within waters belonging to Oman. However, due to its narrowness, vessels are often required to pass through Iranian territorial waters as well. Legal status Under the United Nations Convention on the Law of the Sea, it is regarded as an ‘international strait’. Therefore, no country has the legal right to obstruct peaceful maritime navigation through it. What happens if the Strait of Hormuz is closed? Around 20% of the world’s daily crude oil consumption passes through this strait. Closing it would effectively halt about one-fifth of the global oil supply at once, according to reports. This could lead to a surge in global oil prices, rising global inflation, increases in the prices of goods and services, and major factories in Europe and Asia being forced to scale down or suspend operations. Can Iran actually close the Strait of Hormuz? Given that Iran possesses a large missile arsenal and a fleet of small, fast attack craft, it has the capability to obstruct this narrow waterway. However, several major complications would arise. As the United States Fifth Fleet is stationed in the region, such an attempt could trigger a major military confrontation. Moreover, closing this route could severely affect Iran’s own oil exports and economy. Impact on Sri Lanka Analysts abroad are of the view that the impact on Sri Lanka could be severe, as the country imports oil from the Middle East. They point out that not only oil and gas, but also electricity prices could rise sharply as a result.