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The Hindu
14 hours ago
- Business
- The Hindu
A dire Strait
A crucial choke point for the world's oil supply may become another casualty of the Iran-Israel war. The Strait of Hormuz, a channel less than 100 km in width, separates Iran from the Arabian Peninsula, connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea. It, however, occupies an outsize importance on the global stage, serving as a key passage for oil and natural gas from the littoral nations of the Persian Gulf, such as Saudi Arabia, Iraq, Kuwait, the UAE, Qatar, and Iran to the rest of the world. Around a quarter of the world's total oil supply passes through this channel, which is 55km to 95km in width. On average, the Strait witnessed an oil flow of 20 million barrels per day in 2024. The Strait lies next to Iran, which is presently engaged in an escalating conflict with Israel after the latter bombed key nuclear and military sites on June 13, 2025. Iran retaliated with missile strikes. In the past, Iran has threatened to shut down the Strait in times of conflict, and ships have been targeted through the jamming of signals and other retaliatory measures. In the Iran-Iraq war from 1980 to 1988, tankers and cargo ships in the Gulf region were attacked by both countries, leading to U.S. intervention and the escort of Kuwaiti tankers by their warships. Concerns have arisen that Iran may follow the playbook of this war, dubbed the Tanker War. Similar threats Iran had issued similar threats to shut down the canal in 2011-12 following Western oil and banking sanctions. However, the situation de-escalated before any such attempt. The spectre of Strait shutdown resurfaced in 2019, after the U.S withdrew from the Iran nuclear deal and issued heavy sanctions on Iran, leading to a period of tense relations between the two countries. On July 19, 2019, Iran captured Stena Impero, an oil tanker sailing under the British flag, as it passed through the region, to retaliate for the British capture of its vessel. Further, it shot down a U.S surveillance drone, claiming that it had crossed over into its territorial waters. Thus, while a complete shutdown has no historical precedent, disruptions in the global oil trade is expected as the Israel-Iran war continues. Shipping companies such as Nippon Yusen KK have instructed vessels to exercise caution while passing near the Iranian coast. Delays and increased costs of shipping may also drive up oil prices. The price of Brent crude — a global benchmark — saw a brief spike, although it has now stabilised, dipping 2.33%, to settle at $77.01 a barrel. Oil prices had risen by around 3% after Israeli strikes on Iran. While alternate sea routes are not convenient, land-based pipelines may help tide over some challenges. These include pipelines operated by Saudi Arabia's national establishment, ARAMCO, and the UAE. Iran, too, operates the Goreh-Jask pipeline and the Jask export terminal in the Gulf of Oman. There has been a slight decline in the volume of oil shipped through the Strait of Hormuz since 2022, in part owing to a policy adopted by OPEC+ countries to cut down on the production of crude oil. The Strait, however, still remains a central figure. According to a brief by the U.S Energy Information Administration, Saudi Arabia moves the largest volume of crude oil and allied products through the Strait of Hormuz. More than 80% of the oil supply through the Strait of Hormuz is destined for Asian ports. India's oil supply is heavily reliant on the region, with around 40% of its crude oil imports and 54% of its liquefied natural gas imports travelling through the Strait of Hormuz. Indian oil exports may also be disrupted by the regional strife, with domestic demand taking precedence in the event of a shortfall. Union Minister for Petroleum and Natural Gas, Hardeep Singh Puri, noted that of the 5.5 million barrels of oil consumed daily in India, 1.5 million pass through the Strait. Mr. Puri has indicated that India will consider other options, including imports from West Africa, if the Strait is blocked. As trouble brews in West Asia, all eyes are on the Strait of Hormuz.
The Hindu
25-04-2025
- Politics
- The Hindu
Naidu invites Modi for relaunch of Amaravati works, extends solidarity in wake of Pahalgam attack
Andhra Pradesh Chief Minister N. Chandrababu Naidu met Prime Minister Narendra Modi at the latter's residence in New Delhi on Friday and extended wholehearted support to the Central Government in the wake of the recent terror attack in Pahalgam of Jammu and Kashmir. Condemning the attack in the strongest terms, Mr. Naidu described it as 'an act of cowardice'. He told the Prime Minister, 'We are with you, and the whole country stands with you in whatever decision you take in the interest of the nation.' He expressed confidence in Mr. Modi's strong and stable leadership to guide the country through such difficult times. Inviting Mr. Modi to visit Amaravati for relaunch of works, the Chief Minister explained the vision for the capital as a futuristic and inclusive city. He welcomed the Prime Minister's suggestions on the city's development, including adopting the Miyawaki model for urban afforestation, which the State government would implement. Mr. Naidu also extended a personal invitation to the Prime Minister to visit Srisailam, reinforcing the State's deep cultural heritage and the Centre's continued support for Andhra Pradesh's progress. During the meeting, the Chief Minister thanked the Prime Minister for his continued support for Andhra Pradesh's development journey. Conveying his gratitude for the progress on the Polavaram project, Mr. Naidu briefed the Prime Minister about the ongoing works. He also thanked the Prime Minister for considering the sanction of the BPCL Refinery and Petrochemical Complex in the State, noting that early finalisation of the ARAMCO partnership would bring added advantages to the project. Mr. Naidu appreciated the proactive assistance of the Union Government in facilitating projects like the NTPC expansion and the ArcelorMittal Nippon Steel plant. He also acknowledged the Prime Minister's role in advancing the long-pending demand for Scheduled Caste categorisation in Andhra Pradesh.
