What Happened
- The closure of the Strait of Hormuz following the US-Israel conflict with Iran has exposed the structural fragility of global trade, which depends overwhelmingly on a handful of narrow maritime passages
- Brent crude prices jumped from approximately $70/barrel to over $100 since the Hormuz crisis began, with Gulf states unable to reroute energy exports due to geography
- Five chokepoints — Hormuz, Suez, Panama, Malacca, and the Turkish Straits — collectively handle the vast majority of seaborne world trade; each faces a unique combination of geopolitical, climate, and piracy risks
- Houthi attacks (2023–2025) on the Suez Canal route had already halved annual vessel traffic from 26,000 to approximately 13,000 ships, forcing rerouting around the Cape of Good Hope
- Droughts in 2023–2024 forced the Panama Canal to restrict vessel size and passage numbers, a climate vulnerability now recognised as structural
Static Topic Bridges
UNCLOS and the Right of Transit Passage
The United Nations Convention on the Law of the Sea (UNCLOS), adopted in 1982 and in force from 1994, established the legal regime governing international straits. Article 37 defines which straits are subject to the transit passage regime — those used for international navigation connecting two parts of the high seas or Exclusive Economic Zones. Article 38 grants all ships and aircraft the right of transit passage through such straits, a right that "shall not be impeded," and Article 44 explicitly bars coastal states from suspending this right even during military exercises. The transit passage concept was a deliberate innovation to balance the 12-nautical-mile territorial sea extension with navigational freedoms.
- Iran has signed but not ratified UNCLOS and instead applies a national 1993 maritime law recognising only "innocent passage," not full transit passage
- Despite Iran's non-ratification, the transit-passage regime for international straits is widely regarded as customary international law binding on all states
- The Strait of Hormuz — shared between Iran and Oman — is approximately 33 km wide at its narrowest navigable point, with two 3.2 km traffic lanes separated by a 3.2 km median
Connection to this news: Iran's ability to legally contest the right of transit passage through Hormuz rests on its non-ratification of UNCLOS; the current crisis tests whether customary international law can be enforced without UNCLOS's dispute settlement mechanisms.
The Malacca Dilemma and China's Strategic Vulnerability
The Strait of Malacca, linking the Indian Ocean to the South China Sea, is the world's busiest shipping lane, carrying 24% of all seaborne trade and 45% of seaborne crude oil globally. Beijing's own strategists coined the phrase "Malacca Dilemma" to describe China's acute vulnerability: nearly 80% of China's oil imports pass through this single chokepoint, controlled by littoral states (Malaysia, Singapore, Indonesia) with close security ties to the United States. China's response has been multi-track — investing in overland pipelines (China-Myanmar Oil and Gas Pipeline, 2013), pursuing the China-Pakistan Economic Corridor with Gwadar port, and building naval capacity in the Indian Ocean Region.
- Singapore hosts the world's second-busiest container port (by throughput), making it the effective controller of Malacca's southern exit
- Over 130 piracy incidents were reported in and around Malacca in 2025, the highest in over a decade
- The 900 km China-Myanmar Oil and Gas Pipeline began operations in 2013, offering China partial but not full bypass capability
Connection to this news: The Hormuz crisis simultaneously stresses China's Malacca exposure — Iran is China's primary oil supplier through Hormuz, meaning two major chokepoints simultaneously bear on China's energy security.
The Suez Canal and Houthi Disruption
The Suez Canal, opened in 1869 and nationalised by Egypt in 1956, is operated by the Suez Canal Authority and handles approximately 10% of global seaborne trade, including 22% of container traffic and 20% of car shipments. The canal saves at least 10 days on the Asia-Europe route compared to the Cape of Good Hope alternative. The Houthi attacks on Red Sea shipping (2023–2025) — carried out in solidarity with Gaza — demonstrated that a non-state armed group can functionally disrupt one of the world's most critical maritime corridors without physically blocking it: insurance and diversion costs alone raised effective transit costs substantially.
- The 2021 Ever Given grounding blocked the Suez Canal for six days, disrupting approximately $10 billion in daily trade
- Houthi attacks reduced annual Suez traffic from approximately 26,000 vessels (2023) to ~13,000 (2024), forcing ships onto the Cape of Good Hope route (+10–14 days, +$1 million+ fuel per voyage)
- The Montreux Convention (1936) governs Turkey's control of the Bosphorus and Dardanelles; Turkey used it to restrict warship passage after Russia's 2022 Ukraine invasion
Connection to this news: The simultaneous stress on Hormuz and the prior stress on Suez illustrates the compounding nature of chokepoint risk — individual events that would have been manageable in isolation are now layered.
Key Facts & Data
- Strait of Hormuz: carries ~39% of seaborne crude oil trade and ~19% of global natural gas trade
- Strait of Malacca: 24% of all seaborne trade; ~80% of China's oil imports; 45% of global seaborne crude oil
- Suez Canal: 10% of global seaborne trade, 22% of container traffic
- Panama Canal: 2.5% of global seaborne trade but ~40% of US containerised shipments ($270 billion/year)
- Turkish Straits: ~3% of global seaborne trade; ~20% of global wheat exports (Ukraine, Russia, Romania)
- Experts identify 24 maritime chokepoints globally including Taiwan Strait, Dover Strait, and Bering Strait
- Gulf region handles over 26 million containers annually plus major fertiliser exports