The war on Iran, in the second week of fighting and in mid March, shifted into a conflict over freedom of navigation in the Strait of Hormuz.
This strategic shift by Iran was not accidental; rather, using the strait had long been anticipated as a political lever. Between 15 and 20 million barrels of crude oil are exported through it to global markets, meaning that any disruption to freedom of navigation there would have negative repercussions for the global energy industry.
The US-Israeli coalition did not initially raise the issue of freedom of navigation in the Arabian Gulf or the Strait of Hormuz at the start of the war. Iran itself also refrained from “activating” the issue of the strait until Israeli forces assassinated Iran’s Supreme Leader, Ali Khamenei. US President Trump later announced linking freedom of navigation in the strait to a permanent ceasefire agreement. However, Iran again suspended navigation after Israel escalated its attacks on Lebanon.
Since then, the gist of the coalition’s media coverage - particularly Israeli - has changed. Instead of emphasizing a potential uprising by the Iranian people against their rulers, which Israeli intelligence had failed to orchestrate successfully, freedom of navigation in the strait became the primary objective on which both sides, at least Washington and Tehran, focused.
At the same time, Israel paid little attention to the strait in either its military operations or its media. This is not surprising, as Israel’s oil import sources do not depend on the strait, and its gas supplies have become domestic.
Iran opened a new front in the war by targeting, through drone and missile strikes, residential, military, and oil facilities in Gulf Cooperation Council countries. Iran’s closure of the strait reduced about 75 percent of its production capacity, due to its inability to export through it. Iraqi oil exports also dropped from 4.3 million barrels per day before the war to 800,000 barrels per day.
Iran also bombed the Haifa refinery in Israel, while Iranian industrial facilities suffered heavy losses due to US-Israeli strikes at the beginning of the war.
The question now is: when will international shipping return to normal, and how will that affect the new oil price range? There are currently dozens of tankers needing to pass through the strait, with thousands of sailors stranded onboard. Considering the disputes and maneuvering surrounding efforts to hold a meeting to sign a ceasefire - reflecting ongoing disagreements - it may take several months for navigation to return to its pre-war norm under these conditions.
