Sky News Daily What is the Strait of Hormuz - and why does it matter to global trade?
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Jun 23, 2025 In this discussion, Ed Conway, Sky News' economics editor, sheds light on the critical Strait of Hormuz, the world's busiest oil shipping channel. With Iran threatening to close this vital passage, he explores potential economic fallout, including skyrocketing oil prices. The conversation reveals how a blockade could disrupt global supply chains, impact UK gas imports, and influence living costs. Conway also highlights the geopolitical vulnerabilities that arise from relying on unstable regions for essential resources.
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Why Strait of Hormuz Matters
- The Strait of Hormuz is a narrow critical chokepoint for global oil and gas shipments.
- About a fifth of the world's oil goes through it, making it vital for global energy supply.
Oil Still Crucial Despite US Production
- The US is more energy self-sufficient now but the Strait of Hormuz remains crucial.
- Oil is still the bedrock of transport and global economies depend heavily on it.
Economic Impact of Strait Closure
- Closing the Strait would cause oil prices to soar and disrupt supply chains globally.
- It would hurt Iran economically too as their exports rely heavily on tanker shipments.