By Saanchi Gupta | Updated: April 6, 2026 6:28 PM IST
You may have heard about the Strait of Hormuz in news lately. Are you wondering why is this water route so important for the world? Even a small disruption here can affect fuel prices globally. Here, we take you through a simple breakdown of why it matters so much.
It is a narrow water passage between the Omani Musandam Peninsula and Iran. This makes it an integral global shipping route. After US and Israel attacked Iran on February 28, the latter had effectively locked the passage for many countries, affecting the global oil supplies.
You may be surprised to know that 20 per cent of the world’s oil supply passes through this route. This makes it one of the busiest oil transit points. Any disruption here may impact global fuel supply.
Countries like Saudi Arabia, UAE, Iraq and Kuwait export oil through this route and they are considered some of the biggest oil producers.
India remained almost 60 percent dependent on the oil imports, out of which, 90 per cent entered the country through the Strait of Hormuz. This is one of the reasons for the supply chain distributions and LPG crisis in some parts of India when the war started. However, the government later directed for an increase in the domestic LPG production to solve the crisis. In a nutshell, India imports most of its oil from West Asia, which directly affects petrol, diesel and LPG supply.
Any conflict in the region can greatly affect shipping as the ships may slow down or avoid the route during conflicts. This leads to supply issues and price rise globally.
If the Strait of Hormuz gets completely blocked, the oil supplies may reduce significantly, which can further result in global supply reduction and an increase in fuel prices. This impacts transport, economy and daily life.