What's Going On With The Strait of Hormuz? EXPLAINER
Suggested Resources:
Matin-Asgari, Afshin. Axis of Empire: A History of Iran-US Relations. Jan. 2026. https://bookshop.org/a/83711/9781839762260
Coup 53 [Documentary, 2019]. https://vimeo.com/ondemand/coup53movie
Sources
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Dyson, Ben. “Marine War Insurance for Hormuz Dries up as Middle East War Intensifies.” S&P Global Market Intelligence, March 3, 2026. https://www.spglobal.com/market-intelligence/en/news-insights/articles/2026/3/marine-war-insurance-for-hormuz-dries-up-as-middle-east-war-intensifies-99283143.
Eavis, Peter. “Energy Secretary Says Tankers Could Start Moving Soon.” Business. The New York Times, March 8, 2026. https://www.nytimes.com/2026/03/08/business/chris-wright-strait-of-hormuz.html.
Energy.Gov. “Strategic Petroleum Reserve.” August 31, 2025. https://www.energy.gov/hgeo/opr/strategic-petroleum-reserve.
Fassihi, Farnaz, and Devon Lum. “Israel Strikes Oil Facilities in Iran.” World. The New York Times, March 8, 2026. https://www.nytimes.com/2026/03/07/world/middleeast/israel-iran-oil-strikes.html.
“Frequently Asked Questions (FAQs) - U.S. Energy Information Administration (EIA).” Accessed March 9, 2026. https://www.eia.gov/tools/faqs/faq.php?id=33&t=6.
Hernandez, America. “How Much Oil Do G7 Countries Hold in Emergency Reserves?” Energy. Reuters, March 9, 2026. https://www.reuters.com/business/energy/how-much-oil-do-g7-countries-hold-emergency-reserves-2026-03-09/.
“How Does the U.S. Government Use the Strategic Petroleum Reserve? | Council on Foreign Relations.” January 11, 2023. https://www.cfr.org/backgrounders/how-does-us-government-use-strategic-petroleum-reserve.
Islam, Faisal. G7 Nations to Hold Emergency Meeting on Oil as Stock Markets Sink. March 9, 2026. https://www.bbc.com/news/articles/c79542n0grwo.
Leali. “G7 Weighs Using Emergency Oil Reserves amid Soaring Prices Driven by War.” POLITICO, March 9, 2026. https://www.politico.eu/article/g7-finance-ministers-weigh-using-emergency-oil-reserves-amid-soaring-prices/.
Montanaro, Domenico. “Poll: A Majority of Americans Opposes U.S. Military Action in Iran.” Middle East Conflict. NPR, March 6, 2026. https://www.npr.org/2026/03/06/nx-s1-5737627/iran-us-military-poll-trump-approval.
Prétat, Harrison, Monica Sato, Aidan Powers-Riggs, and Matthew P. Funaiole. “No One, Not Even Beijing, Is Getting Through the Strait of Hormuz.” Center for Strategic and International Studies, March 6, 2026. https://www.csis.org/analysis/no-one-not-even-beijing-getting-through-strait-hormuz.
Strauss Center for International Security and Law. “Strait of Hormuz - Geography - The Strauss Center.” Accessed March 9, 2026. https://www.strausscenter.org/strait-of-hormuz-geography/.
Tondo, Lorenzo. “Iran Threatens Retaliatory Attacks on Oil Facilities across Gulf after Israeli Strikes.” World News. The Guardian, March 8, 2026. https://www.theguardian.com/world/2026/mar/08/iran-new-supreme-leader-selected-says-deciding-body.
US Energy Information Administration. “Amid Regional Conflict, the Strait of Hormuz Remains Critical Oil Chokepoint - U.S. Energy Information Administration (EIA).” Accessed March 9, 2026. https://www.eia.gov/todayinenergy/detail.php?id=65504.
Transcript
Hi it’s Monday, March 9, 2026, you’re tuned into Why, America? I’m your lawyer friend, Leeja Miller. Over the weekend, the Israeli military bombed numerous oil storage depots and refineries in and around Iran’s capital city Tehran, a sprawling metropolis that’s home to 10 million people, some of whom live and work near the targeted strike areas. Videos of the attacks show columns of fire and smoke billowing into the night sky in densely populated areas. Iran has threatened swift retaliation against oil facilities in neighboring countries and against Israel, with a spokesperson for Iran’s Revolutionary Guards threatening that oil will top $200 dollars per barrel if Israel and the US continue attacking their energy infrastructure. Iran has named a new supreme leader, Mojtaba Khamenei, the second son of slain leader Ayatollah Ali Khamenei. The son is described as even more hardline than his father, indicating that Iran has no intention of backing down or pulling a Venezuela and attempting to appease Trump. All of this indicates that the escalating conflict in the middle east will not be a quick military operation, and could stretch on for weeks or months. This prospect has upset global markets, including the price of oil, which peaked at near $120 per barrel this morning before falling back to just over $100. With all of the chaos, I wanted to center our focus on one tiny geographic region playing an outsized role in this conflict and in geopolitical calculations as the war rages on: the Strait of Hormuz, a 20 mile wide stretch of water through which one fifth of the world’s oil is shipped. Today we’re discussing the ongoing battle over control of this strait and how shuttering this tiny bit of water could have implications across the entire global economy that will impact more than just what you pay at the gas pump.
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Let’s start with the basics, because I know these get kind of brushed over in the news coverage of this conflict. The Strait of Hormuz is situated between Oman to the south and Iran to the north. It is 20 miles wide at its narrowest point, but has depths of over 650 feet in some places, making it passable by even the largest shipping vessels.
This makes the Strait of Hormuz the most important oil transit choke point in the world. According to the US Energy Information Administration, quote “Chokepoints are narrow channels along widely used global sea routes that are critical to global energy security. The inability of oil to transit a major chokepoint, even temporarily, can create substantial supply delays and raise shipping costs, potentially increasing world energy prices. Although most chokepoints can be circumvented by using other routes—often adding significantly to transit time—some chokepoints have no practical alternatives. Most volumes that transit the strait have no alternative means of exiting the region.” Fully 20% of the world’s crude oil and liquid natural gas passes through the Straight of Hormuz, upwards of 20 million barrels every single day, coming from Persian Gulf countries Iran, Iraq, Kuwait, Qatar, and Saudi Arabia, and being shipped all over the world, though most oil passing through the strait of hormuz is bound for Asia. While certain countries, like Saudi Arabia, have built extensive oil pipeline networks that can bring oil to other areas and circumvent the Strait of Hormuz, the most direct shipping route and the one depended on again by 20% of the world’s oil, is through the strait. So, as you can imagine, control over these waters is incredibly consequential not only for the region but also for the world.
There are 8 major islands dotting the waters of the strait of hormuz. 7 of them are controlled by Iran, though Iran and the United Arab Emirates disagree as to the ownership of some of the islands. On top of this, United Nations maritime law allows countries to exercise control of the territorial seas up to 12 nautical miles from their coastline–which is equal to 13.8 non-nautical miles. So if at the narrowest point the strait is 20 miles across, that means the straight of Hormuz at its narrowest point lies within Iran and Oman’s territorial waters, with some overlap. But Iran’s military and naval presence in the strait and around the contested islands means Iran has de facto control over the islands and, therefore, stronger influence over what happens in the waters of the strait of hormuz. And Iran knows this gives them leverage on a global scale.
Now, to be clear, there is no physical blockade in the Strait of Hormuz. They didn’t put up a bunch of orange cones on floating buoys and say alright this strait is closed find somewhere else. They could theoretically lay mines across the strait that would explode if crossed, they have the capability to do so, but that’s not what’s happening. Instead, Iran has issued threats against any tanker attempting to pass through, and has made good on those threats by attacking at least five ships in recent days. They have also threatened and attacked various ports in neighboring countries around the Gulf Coast, making it precarious just for the shipping vessels to dock anywhere. Which means upwards of 150 giant shipping vessels are stranded inside the Persian Gulf or waiting to pass through the strait on the other side in the Gulf of Oman.
Because of these increased threats of attacks on oil tankers passing through the Strait of Hormuz, you also then have another issue: insurance. Boring but important to understand. Businesses need liability insurance to make sure if something bad happens it doesn’t bankrupt them. Insurance companies charge a bunch of money to say hey if something bad does happen, we’ll pay for it. But when the threat of something bad happening increases dramatically, so too does the price to insure the business, with some insurance companies opting to not offer certain coverage altogether if the risk becomes so high that it's not worth it for them. That’s what’s happening here–these major oil tankers, which are expensive in themselves and are carrying expensive cargo, need insurance to protect them should something bad happen. And insurance companies are now increasing the cost of coverage up to 400% or more. It can now cost upwards of $400,000 just to ship one of these tankers through the strait to Asia, which is double what it was before the start of the war. And that’s if you can even get insurance–some insurers are deciding to no longer cover any damage incurred in the ongoing war. Owners of these tankers are then unwilling to send their ships through the strait because the cost is too high or any damage incurred, damage which is more and more likely as the conflict continues, would then fall on them. So you have the threats from Iran on top of the threats from insurance companies effectively shutting down the strait of Hormuz even if there is no actual physical blockade in place. The result is that, prior to the war, about 153 vessels were passing through the Strait every day. Now, only 13 on average are passing per day.
And you have to follow the money on this one to understand how this conflict might spread. Insurers are also concerned with the Red Sea, located on the other side of Saudi Arabia from the Strait of Hormuz, and another major waterway through which oil passes, though not as large or consequential as Hormuz. In the Red Sea, historically the Houthis, the Iran-backed group in Yemen, have attacked shipping vessels there, something that could start happening again especially as this conflict continues. The Red Sea is also the site of Saudi Arabian oil pipelines that are used to divert oil away from the Strait of Hormuz to bypass conflict there. Choking off both straits would increase the global oil crisis.
The Trump regime has claimed it will provide its own insurance to these oil tankers to get tankers moving, and that the US government could cover up to $20 billion in losses. However, shipping analysts say it would take a hell of a lot more than that to insure these tankers and make up for the damage that Iran has promised to inflict on any tanker attempting to pass through the strait. Trump has also floated the idea that the US Navy might go out there and provide escort forces to protect tankers as they pass through the strait. That option is not without precedent–during the eight year Iran-Iraq war in the 1980s, the US sent warships to escort Kuwaiti tankers carrying Iraqi oil through the strait that were especially vulnerable to attack from the warring countries attempting to exert economic pressure. But the problem with that is that Iran is now actively at war with the US, so any US naval ships sent to the area would be vulnerable to attack. Also, reminder that federally-backed insurance coverage and naval escort service for these tankers, and any resulting losses, would come out of the taxes we pay. It’s tax season and I just discovered how much money I owe still for 2025 and my estimates were SO far off. I’m very thankful to do this work and that this channel is growing, but the fact that this money I’m paying will be going towards bombs for children and a US-instigated war with Iran is hard to swallow, especially when Jeff Bezos and Elon Musk and their businesses pay zero taxes or a fraction of one percent some years. It makes me sick!!!
With all of this in play, the question on everyone’s mind, especially the analysts and businesses waiting to see how things play out, is how long will this conflict last? The true answer is no one knows. But Trump has claimed variously that it will just be a couple weeks but threatened that it could be a few months. Karoline Leavitt recently did not rule out US boots on the ground in Iran, which would escalate the conflict dramatically–so far our involvement has been more remote via air and sea or supporting Israeli attacks. Putting US personnel on the ground is a completely different ballgame and would absolutely lead to longer term conflict between the US and Iran, as well as between Iran and Israel and Iran and all of its other enemies in the region. Plus Iran is home to over 90 million people and takes up a land mass equivalent to all of Western Europe–the US invading a territory like Iran would not end quickly.
Trump’s energy secretary, Chris Wright, who up until now has gotten very little air time compared to many of Trump’s goons, went on CNN over the weekend and said quote “We’re not too long, I think, before you will see more regular resumption of ship traffic through the Strait of Hormuz.” He claimed that the worst case scenario is that it will take a few weeks tops to get ships moving again. The regime seems to be betting that, along with Israel, it will be able to take out Iran’s naval and military capabilities so that its threats hold less weight, because they won’t have the capacity to attack ships passing through the strait. That is, I think, a tall order given the sheer size of Iran, its many proxy armies, and the breadth of Trump’s stated goals in Iran, which change daily but include to obliterate its nuclear capabilities, to “defang” it so it can’t support terrorism abroad, to dismantle its navy, to weaken its military, etc. And given the fact that Trump has a proven history of lying–just 8 months ago he claimed to have completely annihilated Iran’s nuclear capabilities and yet here we are–its hard to know if or when we will ever reach our objectives, or at what point Trump will decide we can declare victory–whether true or not–and head home. We are also now involved in a war in which we are tied to Israel, which has even more to lose given its proximity to the conflict, and which the United States has proven, time and again, willing to do literally anything to support, appease, and keep happy. Neither Trump nor Netanyahu are men who are willing to ever admit defeat, so it's unclear what “victory” looks like in this conflict.
According to Trump, it’s all worth it. Over the weekend he posted on Truth Social, quote “Short term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for USA and world safety and peace. Only fools would think differently!” And when will that destruction of the Iran nuclear threat BE over? Who knows. According to Trump it was over last summer. But it’s back, apparently, and who knows what it will take to make it go away this time.
If the conflict does stretch for weeks or months, there is increased likelihood that its impacts will spread beyond just the Strait of Hormuz. Decreased supply of oil out of the Persian Gulf, oil that primarily serves Asia and, importantly, China, could increasingly mean Chinese involvement in the conflict or, at the very least, pressure from China to resolve the conflict quickly. Iran could potentially use the safe passage of oil tankers bound for China as a bargaining chip to exert pressure on China to get involved in some way, such as by providing Iran with financial, military, or other support. China is the largest single destination for energy flows through the Strait of Hormuz. China gets 40% of its oil and 30% of its liquid natural gas (LNG) through the strait. And China buys fully 90% of all of Iran’s oil exports. So the oil-based dependence goes both ways.
And this is an example of how this effective blockade of the Strait of Hormuz could impact the entire world, beyond just the price you see at the gas pump. Because the US has other oil reserves and much of the oil going through the Strait of Hormuz is bound for Asia, not the US. But globalization means that we are incredibly dependent on China and the rest of Asia for so much of our STUFF. And in America, we fucking LOVE stuff. So add on top of the increased tariff prices now the increased oil prices onto every major consumer good that is produced in Asia, which is dependent on the Strait of Hormuz for its oil. Whether it's making the stuff or shipping the stuff, every step of the supply chain is going to get more expensive as oil exports get clamped off and oil barrels get more and more expensive.
But many major countries have large reserves of crude oil on hand in order to mitigate against these types of global disruptions in oil supply. Today the finance ministers from the Group of 7 or G7 countries–Canada, France, Germany, Italy, Japan, the US, and the UK met to discuss a possible release of the G7 oil reserves. The United States has a series of 4 huge underground salt caverns along the coast of the Gulf of Mexico where the country’s Strategic Petroleum Reserve is stored. The sites have the capacity to hold 714 million barrels total, though they currently hold about 415 million barrels. Japan has 260 million barrels on reserve, Germany has 110 million, France has 120 million, Italy has 76 million, the UK has 38 million, and Canada doesn’t have any because they are a net exporter of oil–they produce about 5 million barrels of oil per day, most of which is exported to the US. As for the US reserves, Trump has broad authority to order the sale of the reserve oil in response to emergencies and disruptions in the oil supply chain. Presidents have routinely tapped into the oil reserves, most recently by Biden in response to the Pandemic and Russia’s war with Ukraine. The strategic petroleum reserves were created in response to the 1973 oil embargo imposed by the Organization of Petroleum Exporting Countries or OPEC in retaliation for the US’s support of Israel during the Fourth Arab-Israeli War. Basically, it is beneficial for the US to have major oil reserves so that it is less beholden to oil rich countries and can therefore make geopolitical decisions without access to oil being as much of a concern. Another way we could do that is by, I don’t know, becoming less dependent on oil through the use of renewable energy, wild concept, but you know what the fuck do I know.
By releasing this oil at a time when Persian Gulf countries have lowered daily output because the oil has nowhere to go with the strait of hormuz closed, the G7 countries would thereby raise the global oil supply which would then lower the price per barrel of crude oil, making the entire economy more affordable, because if everything is created or shipped using oil, then everything is more expensive when the price of a barrel of oil goes up, not just at the gas pump when you fill up your car. When this measure was implemented in 2022 in response to Russia’s invasion of Ukraine, it helped bring Brent prices down from $139 per barrel to $105 per barrel over the course of about two months. Now just to give you an idea of the scale, the strategic oil reserves of all the G7 countries combined is equal to just over a month of the G7 countries’ total oil usage. The US alone uses about 20 million barrels of oil per day. Of course, we get our oil from places other than the persian gulf as well, so we wouldn’t need to supply 100% of the oil for all G7 countries, but it helps put into perspective the sheer quantity of oil we’re consuming and how much this closure of the strait of hormuz disrupts everything. And to paint the larger picture: The disruption in the flow of oil could lead, according to Politico, to the dreaded staglfation–a major disruption in economic growth, because of global uncertainty, combined with a sharp uptick in consumer prices, because everything will be more expensive to make and ship. This would then force central banks to raise interest rates to address that inflation by raising the cost of borrowing, which reduces consumer spending and business investment, meaning the demand for goods and services goes down, and so the inflationary prices go down as well–because the lower the demand, the less companies can charge for the things they’re selling. But that’s a thorny theory when stagflation is afoot, because economic growth is already depressed, so raising interest rates, making it cost more to borrow money, could depress it further, leading to a full blown global recession, including a major upset of the labor market leading to widespread unemployment.
And financial markets are indicating they do not think there’s a lot of hope for a swift resolution to this conflict. On Friday last week, analysts were keeping it cool, but due to the continued bombings over the weekend, including of major oil refineries in Iran, the market has absolutely lost its cool. This morning in Asia, oil prices jumped 25%, hitting almost $120 per barrel but then falling back to around $107 dollars. Gas prices in the UK jumped 25%. Stock markets across Europe fell sharply, upwards of 2% in some places, fully 5.2% in Japan and 6% in Korea. And in the US, markets fell 1.3% on average as gas prices surpassed $100 per barrel for the first time since 2022. Gas prices at the pump rose to $3.48 on average, up from $2.90 a month ago. Despite this, economists are cautioning against complete panic–there was an oil price shock after Russia invaded Ukraine in 2022 at the peak of Covid-era supply chain chaos and that did not trigger major recessions in the US or Europe. So the TLDR of it all is that no one knows what’s going to happen to gas prices, to consumer prices, or to the global economy. No one, not even, apparently, Trump himself knows how long this conflict will last. And no one BESIDES Trump and probably Netanyahu of Israel, WANTS to be involved in this conflict. Well, not no one. About 36% of respondents to a recent poll indicated they approve of how Trump is handling Iran. So it's incredibly unpopular by the numbers, fully 64% of people do not approve of how Trump is handling Iran, 56% say they oppose military action. But I find it unsettling still that 36% of respondents, and this is to an NPR/PBS/Marist combo poll, so these respondents likely aren’t fully representative of his base of supporters, many of whom would never respond to a poll conducted by two public news media and an elitist university, even still 36% say they DO approve of how Trump is handling Iran. I think the headlines tend to try to tell the story in a way that wraps it up in a tidy bow–a majority of Americans opposes US military action in Iran, is how NPR summarized this poll. Which isn’t incorrect, but I think the real headline is that 36% of people do approve of Trump’s handling of this situation. I live in such a bubble and an echo chamber that it’s fucking flabbergasting to see numbers like that like my flabbers are gasted who is looking at the apocalyptic videos and images coming out of Iran right now and saying yes this is correct, my tax dollars hard at work, I approve, looks great. Who watches Trump speak and thinks yup I trust him with the nuclear codes. Fine by me? Apparently over a third of Americans do. I don’t have any way of tying up this point with its own tidy bow I just wanted to point that out. We are a deeply broken, deeply divided country. The president is doing shit most of us do not approve of, but there is still a not insignificant subset of the population that is gung ho for useless war. We have to look that in the face if we’re ever going to contend with how we got here. Here meaning this war with Iran or here meaning this second Trump term. I don’t have a cute “what can we do about it” message at the end of this video, because like every war before this it is completely out of our hands, and people are being sent to die at the whim of powerful egotistical men on a rampage. That’s not to say that it’s not worth speaking out and continuing to make it known that most people do not want this, and at least in theory as a democracy what the majority wants should matter. But it’s hard not to feel pretty helpless about all of it. I always turn to information and education when things feel out of my control. The same is true here. I am starting by reading a brand new book called Axis of Empire: A History of Iran-US Relations by historian Afshin Matin-Asgari. I also want to watch the film Coup 53, a 2019 documentary directed by Iranian film maker Taghi Amirani about the CIA and M16 backed ouster of Iran’s democratically elected prime minister. I invite you to read or watch those, or comment below other sources so we can all learn more, which I at least find helps me feel like I have a grasp on understanding what’s going on, even if I can’t control it.
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And if you liked this episode, you’ll like my episode from last week about AI, the Pentagon, and why you shouldn’t download Claude either.
