economy
March 3, 2026
Iran may close Strait of Hormuz amid Israel conflict. How does it affect the world's oil?
This story was originally published in June 2025. Since then, the U.S. and Israel launched a wave of joint strikes against Iran, prompting the Islamic Revolutionary Guard Corps to declare that the Strait of Hormuz has been “effectively closed” to maritime vessels. To read our latest coverage on the conflict, click here. To learn more about the Strait of Hormuz, read below.
TL;DR
- The Strait of Hormuz is a narrow passage connecting the Persian Gulf to the Gulf of Oman, vital for global oil production.
- About 25% of the world's oil supply, approximately 20 million barrels per day in 2024, travels through the strait.
- A closure could cause oil prices to increase by 30% to 50%, potentially raising U.S. gas prices significantly.
- While alternative pipelines exist, they cannot transport the volume of oil that passes through the Strait of Hormuz.
- Iran has threatened to close the strait before, during the Iran-Iraq War and in 2018 amid tensions with the U.S.
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