Threats from Iran have largely halted maritime traffic through the Strait of Hormuz, but experts doubt Tehran would risk a long-term blockade in response to US‑Israeli attacks. Around 70% of Iran’s non‑oil trade moves through ports that rely on access via the strait, and closing it would harm Iran itself by cutting off crucial imports such as food and by blocking the main markets for its exports.
Oil and gas prices have jumped since attacks began, and a sustained danger to traffic through the Strait of Hormuz could push crude toward $100 a barrel or higher. The strait is a major energy artery: about 20% of the world’s crude oil is shipped through it, with over 80% of those deliveries bound for Asia, particularly China, India and Japan. A closure would also disrupt aviation fuel and liquefied natural gas (LNG) supplies — roughly 30% of Europe’s aviation fuel and about 20% of global LNG flows use the passage. Many countries maintain strategic reserves to withstand several weeks of interruption.
A blockade would not only choke off Gulf oil to Western markets but also cut Iran off from buyers in China and India, worsening Tehran’s economic crisis. Iran has faced Western sanctions since the 1979 Islamic Revolution, with additional UN measures between 2006 and 2015 over its nuclear program. Sanctions were eased during Tehran’s participation in the 2015 nuclear deal, then tightened again after the US withdrawal in 2018. Because penalties target those who comply while leaving noncompliant states free to trade, Iran diverted most of its exports to willing partners — notably China. Data platforms show China now takes the bulk of Iranian crude, and it is the major buyer of sanctioned oil from Iran, Venezuela and Russia.
Selling into sanctioned markets forces Iran to accept discounts and higher logistics costs. Using shadow fleets, intermediaries and longer routes raises transport expenses and lowers net revenues. For Iran, China has become an indispensable lifeline for oil exports, buying the large share of crude that would otherwise have few outlets.
At the same time, sanctions have enabled China to diversify its suppliers. Beijing has moved away from suppliers closely tied to the US-led security and financial systems, instead buying discounted oil from sanctioned producers. But sanctions also weaken Iran’s long‑term oil prospects by restricting access to modern technologies, international financing and investment, which hampers production growth. Analysts expect Iran to remain a presence in global oil markets but as a structurally weakened, high‑discount supplier, trading stable volumes for lower per‑unit revenue. This gradual erosion in the oil sector reflects broader declines in economic performance and regime stability.
This article was translated from German.
