Context:
• Rising tensions in West Asia have led to near-collapse of traffic in the Strait of Hormuz, disrupting global energy supply and impacting India’s energy security.
Key Highlights:
- Geopolitical Developments
• Ship traffic reduced by ~95% since February 28
• Around 600 ships stranded
• Iran using the strait as strategic leverage - Global Energy Impact
• Over 20% of global oil and gas trade passes through the strait
• Nearly 40% of India’s imports transit this route
• Qatar halted LNG production, worsening supply shortages - Economic Implications
• Insurance premiums increased by 10–15 times
• Rising global crude prices likely to affect:
- Fuel prices
- Inflation
- Fiscal stability
- Alternative Measures
• India exploring LNG imports from:
- USA
- Russia
- Australia
• U.S. allowed temporary purchase of Russian crude (30 days)
- Strategic Responses
• U.S. considering:
- Security escorts
- Insurance support for ships
• India increasing propane-butane production for LPG
- Constraints
• Alternative routes (e.g., Red Sea) face Houthi attacks
• Limited viable substitutes for Hormuz route
Relevant Prelims Points:
• Strait of Hormuz:
- Located between Iran and Oman
- Only ~33 km wide
- Key global energy chokepoint
• Chokepoint: - Narrow passage critical for trade and navigation
• LNG (Liquefied Natural Gas): - Natural gas cooled for transport
• Exclusive Economic Zone (EEZ): - Maritime zone with resource rights up to 200 nautical miles
Relevant Mains Points:
- Energy Security Challenges
- Heavy reliance on single chokepoint increases vulnerability
- Disruptions lead to supply shocks and price volatility
- Geopolitical Implications
- Strait used as a strategic bargaining tool
- Reflects interconnectedness of global conflicts and energy markets
- Economic Impact
- Rising import costs widen current account deficit
- Inflationary pressures affect common citizens
- Strategic Autonomy
- India balancing relations with U.S., Russia, and Gulf countries
- Temporary relaxation for Russian imports highlights realpolitik
- Challenges
- Limited alternative routes and suppliers
- Exposure to geopolitical risks in West Asia
- Way Forward
- Diversify energy sources and suppliers
- Invest in renewables and green hydrogen
- Strengthen strategic petroleum reserves
- Enhance maritime security cooperation
UPSC Relevance:
• GS 1: World Geography (strategic waterways)
• GS 2: International relations (West Asia geopolitics)
• GS 3: Energy security, economy