From the moment Iran's Revolutionary Guard issued warnings on 28 February that no ships would traverse the Strait of Hormuz, the global economy entered crisis mode. Within weeks, what started as an Iranian threat became brutal reality: roughly one-fifth of the world's daily oil supply ground to a standstill in a waterway just 21 nautical miles wide at its narrowest point.
The collapse followed coordinated US-Israel military strikes on Iran that killed its supreme leader Ali Khamenei. In response, Iran declared the strait closed to all vessels flagged by the United States and its allies. Insurance companies withdrew coverage. Shipping firms suspended operations. Ship-tracking data first showed a 70% reduction in traffic.
The economic damage has been swift and severe. Oil prices have surged above $100 per barrel, the highest since 2022 after the Russia-Ukraine war began. For an economy already struggling with inflation, the implications ripple far beyond fuel pumps. Qatar's giant gas and chemical company QatarEnergy was hit by military strikes and had to stop production entirely, including helium, urea, aluminium and plastics.
What strikes you first is the sheer breadth of the disruption. This is not merely an oil crisis. Fertiliser represents one of the biggest downstream risks, with roughly one-third of global fertiliser trade transiting the Strait of Hormuz, including large volumes of nitrogen exports. As farmers in Iowa and India face the spring planting season, fertiliser costs have soared. Since the Hormuz blockade began, urea prices have jumped 35%.
Faced with this crisis, President Trump appealed to world leaders to form an international naval coalition. He named China, France, Japan, South Korea and the United Kingdom as potential partners. Australia, Japan, Poland, Sweden and Spain said they had no intentions of sending military ships. French President Emmanuel Macron stated: "We are not party to the conflict, and therefore, France will never take part in operations to open or liberate the Strait of Hormuz in the current context."
Australia will not send naval ships to assist in reopening the Strait of Hormuz, a government minister said on Monday. "We won't be sending a ship to the Strait of Hormuz. We know how incredibly important that is, but that's not something that we've been asked or that we're contributing to," Catherine King said.
The reluctance reflects genuine complexities. Many allies question whether military escort operations will meaningfully resolve Iran's threat, which relies on drones rather than conventional naval blockade. Iran achieved the closure through drone strikes in the vicinity of the strait, leading insurers and shipping companies to decide that it was unsafe to traverse the waterway. Insurers wouldn't underwrite ships, and companies wouldn't risk the passage without coverage. Insurance, not missiles, built this wall.
The irony deepened when Trump shifted position. Trump said the United States does not "need any help" in reopening the Strait of Hormuz, despite his appeals for an international coalition. "We don't need too much help, and we don't need any help," he told reporters.
Yet the blockade persists. Traffic through the strait, which normally carries about one-fifth of global oil supplies, has plunged more than 95 percent since the start of the US and Israel's war on Iran. Daily transits by non-Iranian ships, mostly Chinese, Indian and Pakistani-flagged vessels, have dropped into single digits. Some countries have negotiated directly with Iran for safe passage, suggesting the crisis may eventually fracture into a patchwork of separate diplomatic arrangements rather than a unified resolution.
The genuine tension here is real. World leaders face pressure from their own publics and economies to avoid entanglement in a conflict they did not initiate, yet they also face the consequences of inaction. Middle Eastern allies feel the same tension. Meanwhile, Asia, which depends most heavily on Gulf energy, bears much of the pain. In 2024, 84 percent of crude oil shipments transiting the strait headed to Asian markets, with a similar pattern in gas trade. China, India, Japan and South Korea accounted for a combined 69 percent intake of all crude oil flows through the strait.
The question now is whether the crisis resolves through military pressure on Iran, through diplomacy that allows selective transits, or through painful adaptation to higher energy costs and longer supply chains. Each path carries its own risks and costs. What is clear is that the Strait of Hormuz, easily overlooked on most maps, has become one of the world's most consequential choke points, and no coalition has yet found the will or capability to unlock it.