Will Iran close the Strait of Hormuz and is India ready for the fallout?

As tensions escalate once more in the volatile Middle East following U.S. strikes on Iran's key nuclear facilities, concerns have resurfaced globally over a potential Iranian move to shut down the Strait of Hormuz—a critical maritime artery that handles nearly 20 percent of the world's daily oil and gas shipments.

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Yet, amid growing geopolitical uncertainty, India appears relatively insulated from the worst-case fallout, owing to its increasingly diversified energy sourcing strategy, reduced reliance on the Gulf, and robust natural gas import alternatives.

The Strait of Hormuz, barely 21 miles wide at its narrowest, connects the oil-rich Persian Gulf to the Arabian Sea and ultimately the global market. It is flanked by Iran to the north and the Arabian Peninsula to the south and serves as the main transit point for crude and liquefied natural gas (LNG) exports from regional heavyweights like Saudi Arabia, Iraq, the UAE, Kuwait, Qatar, and Iran itself. In 2024, more than 20 million barrels of oil and close to 290 million cubic meters of LNG passed through the strait every day, according to the U.S. Energy Information Administration (EIA).

While any prolonged disruption in this critical choke-point could severely impact global energy security and spike prices, India, which imports about 90 percent of its oil and around 50 percent of its natural gas, is not in panic mode. Of India's daily crude oil imports of approximately 5.5 million barrels, only around 2 million barrels pass through the Strait of Hormuz, meaning over 60 percent of its oil imports are already logistically detached from this vulnerable route.