by Muhammad Nadeem
Amid rising Iran-Israel tensions, Iran may close the Strait of Hormuz, a vital oil trade route. These risks disrupt global supplies, potentially spiking oil prices and impacting India’s energy security.
As the military standoff between the United States and Iran intensifies in the aftermath of US strikes on Iranian nuclear facilities, the ripple effect is being felt far beyond the Middle East. In India, a country whose economy and strategic posture are deeply intertwined with energy imports, alarm bells have started to ring.
At the heart of this anxiety lies the Strait of Hormuz, a narrow, congested but vitally important maritime passage that handles about one-fifth of global oil and gas trade. Any disruption here sends shockwaves through international energy markets, and for India, the consequences could be immediate, economic and strategic.
Activity in the strait of Hormuz, imagine it empty when the pool is closed. pic.twitter.com/OQ5nd3tSIR
— Syrian Girl (@Partisangirl) June 22, 2025
A Waterway That Moves the World
Stretching just 33 kilometres across at its narrowest, the Strait of Hormuz connects the Persian Gulf to the Gulf of Oman and ultimately, the Arabian Sea. With Iran to the north and Oman and the UAE to the south, the passage sees the movement of over 20 million barrels of oil daily, according to the US Energy Information Administration (EIA).
As per EIA data cited by The Times of India, 20.3 million barrels of crude and 290 million cubic metres of LNG passed through the strait daily in 2024. That makes the Strait of Hormuz not just another geopolitical flashpoint; it is the global energy lifeline.
Iran, after Sunday’s US attack on its nuclear facilities at Fordo, Natanz and Esfahan, has responded not just with harsh rhetoric but with action. On June 22, its Parliament approved a measure to shut the Strait of Hormuz, a decision now pending final confirmation by the Supreme National Security Council. Revolutionary Guards Commander and lawmaker Esmail Kosari told state media, “It will be done whenever necessary.”
Is India Vulnerable
India is the third-largest consumer of crude oil globally, importing about 90 per cent of its oil needs. According to PressTV and The Hindu, over 40 per cent of these imports come from Middle Eastern suppliers, countries such as Iraq, Saudi Arabia, UAE and Kuwait, all of whom ship their oil through the Strait of Hormuz.
More specifically, The Times of India reports that 2.1 million barrels per day (bpd) of India’s 5.5 million bpd crude oil imports pass through this strait. That’s nearly 38 per cent of India’s total daily consumption.
Additionally, LNG imports could also face turbulence. While Qatar, India’s primary LNG supplier, may bypass the Strait in some shipments, disruptions in regional shipping lanes or insurance premiums could add costs and delays. Notably, a Hindu report dated June 13 projected that any Hormuz disruption would increase shipping times by 15 to 20 days and raise costs by 40–50 per cent.
The Price at the Pump and the Kitchen
Oil prices, already on an upward trajectory, surged in the days following the US strike. Brent crude crossed $77 per barrel, a near 10 per cent jump since early June. Analysts from Goldman Sachs and Citigroup are now predicting price surges that may breach $90 per barrel if the Strait is indeed closed. An extended closure could push prices even further, with Iranian state media speculating, albeit unrealistically, about $400 per barrel.
For India, this means higher fuel prices at home, despite subsidies. Diesel and LPG, two highly inflation-sensitive commodities, could see price hikes. Fertilisers, CNG, and domestic gas, all heavily dependent on natural gas imports, would also feel the pinch.
While India has a buffer in the form of strategic petroleum reserves (SPR) that can cover 9 to 10 days of imports, these are short-term cushions. The Union Oil Minister Hardeep Singh Puri, in a recent interview, claimed India’s energy security was “manageable,” citing diversified sourcing from Russia, the US, and Brazil. But even that has limits, particularly in logistics and cost.
Tankers Hesitate, Markets Quiver
Shipping activity is already responding to the crisis. According to Kpler data reported by PTI, there has been a significant drop in the number of ballast tankers (those heading empty to pick up cargo) entering the Middle East Gulf, from 69 to 40. Signals from the Gulf of Oman to the MEG (Middle East Gulf) have halved.
The consequence is tightening supply, and India, though now importing more oil from Russia than from the Gulf, cannot fully decouple from Middle Eastern oil. Russian supplies reached 2.2 million bpd in June, but Gulf imports still collectively match that number. And while Russian and US oil arrives via different routes (e.g., Suez Canal, Cape of Good Hope), transportation costs are higher, adding economic pressure.
The Wider Diplomatic Game
International actors are now engaged in backdoor diplomacy. On Sunday, US Secretary of State Marco Rubio appealed directly to China, Iran’s largest oil customer, to dissuade Tehran from following through with the Hormuz closure. “It’s economic suicide,” Rubio said. China sources 47 per cent of its maritime oil through the Strait, including 5.4 million bpd in the first quarter of 2025.
Meanwhile, naval forces in the region, particularly the US Fifth Fleet, remain on high alert. According to Bloomberg, any effort to forcibly block the Strait would likely provoke a military response.
Still, the risk of even a temporary blockade is real. Iran has used the threat of closure as leverage for decades. And while such a move would also damage Iran’s own economy, 96 per cent of its exports pass through Kharg Island at Hormuz; this time, the stakes have been raised by direct US attacks on nuclear infrastructure.
India’s Strategic Response
The Indian government, at present, appears calm but cautious. Senior officials are monitoring developments at both the Chabahar Port, a strategic investment project in Iran, and the International North-South Transport Corridor, both of which may gain importance if Hormuz remains unstable.
Diplomatically, India is expected to engage with both Washington and Tehran while working closely with China, Japan, and South Korea, all major stakeholders in Hormuz’s security. Strategically, its energy planners are recalibrating imports from Russia, West Africa and the Americas, though distances and freight costs remain a concern.
A Test of Energy Sovereignty
The Strait of Hormuz, a 33-kilometre maritime sliver, has once again emerged as a global fault line. For India, the potential closure poses more than just an economic challenge; it is a test of its energy resilience, diplomatic agility, and strategic planning. While temporary buffers exist, a prolonged crisis could leave millions in India grappling with costlier commutes, inflated cooking gas bills, and macroeconomic headwinds.
As tankers cautiously sail and navies shadow them, the next move in the Strait of Hormuz will determine more than just the course of war; it will shape how nations like India weather the geopolitical tide.
(Author is a copy editor at Kashmir Life)
