WAR OR ECONOMY: WHY IRAN CHOSE NOT TO CLOSE THE STRAIT OF HORMUZ

The interplay of war and economy underscores Iran's cautious approach, preserving the Strait as a lifeline rather than a weapon.

- By Prajakta Karnik,

The Strait of Hormuz, a narrow waterway between Iran and Oman, is the world's most critical energy chokepoint, facilitating the passage of 20.3 million barrels of oil per day (20 per cent of global supply) and 20 per cent of global liquefied natural gas (LNG) in 2024.

Amid the escalating Israel-Iran conflict in June 2025, marked by Israel's "Operation Rising Lion" and Iran's retaliatory "True Promise 3," speculation swirled that Iran might close the Strait to retaliate against Israeli and US strikes on its nuclear, military, and energy infrastructure.

Both nations closed their airspaces during the conflict's peak, yet the Strait remained open, defying threats and unverified claims on platforms like X about Iran deploying naval mines. However, despite its rhetorical threats and the closure of air routes, a closer examination of the ongoing war reveals a complex interplay of economic imperatives, geopolitical pressures, and strategic decision-making.

RISING REGIONAL TENSIONS

The conflict intensified on June 13, 2025, when Israel launched a large-scale military operation targeting Iran's nuclear facilities (Fordow, Natanz, Isfahan), missile production sites, and energy infrastructure, including the South Pars gas field and Tehran’s oil refinery.

Israeli Prime Minister Benjamin Netanyahu claimed the strikes set back Iran’s nuclear program by years and aimed to cripple its economic lifeline.

Iran retaliated with over 300 ballistic missiles and drones, targeting Israeli military and civilian sites, though most were intercepted by Israel's Iron Dome and US assistance.