Hormuz is just the beginning of a world held hostage by geography

The ongoing West Asian crisis, triggered by recent strikes on Iran by the United States and Israel, has introduced a new dimension to contemporary warfare. Central to this evolving conflict is the instability surrounding the Strait of Hormuz, which has disrupted global shipping and revealed an emerging model of economic warfare.

In this framework, geography, insurance markets, and technological tools increasingly rival traditional military power in shaping strategic outcomes. The long-standing assumption that major global sea lanes would remain permanently open is now being fundamentally challenged.

Historically, control over sea lanes has been synonymous with global power projection. Classical naval strategists, most notably Alfred Thayer Mahan, argued that dominance at sea translated into dominance over trade and, consequently, geopolitical influence. Throughout the 20th century, the US embodied this doctrine through its expansive naval presence, overseas bases, and maritime patrol networks. However, the current tensions in the Strait of Hormuz suggest a transformation in this paradigm. Maritime trade can now be constrained without a conventional blockade. Drones, naval mines, and — most significantly — the escalation of insurance premiums can render shipping routes economically unviable even in the absence of direct naval confrontation.

As one of the world’s most critical energy corridors, the Strait of Hormuz facilitates the transit of a substantial share of global oil and liquefied natural gas (LNG) supplies. When security risks rise, insurance markets react swiftly. Premiums surge, coverage becomes limited, and shipowners begin avoiding the route. In effect, financial markets can close a maritime passage before military forces do. This quieter form of coercion transforms commercial risk assessment into a powerful strategic instrument.

The Hormuz crisis is not an isolated phenomenon, but part of a broader trend that may define the 21st century as a ‘chokepoint century’. Global trade depends heavily on a small number of narrow maritime passages — including Hormuz, the Strait of Malacca, Bab el-Mandeb, the Bosphorus, and the Danish Straits. Each represents a strategic pressure point. Disruptions in any of these corridors ripple outward, affecting energy prices, shipping costs, industrial supply chains, and ultimately consumer markets worldwide.

The Strait of Malacca illustrates how such vulnerabilities extend beyond West Asia. For years, Chinese policymakers have expressed concern over the ‘Malacca Dilemma’, reflecting dependence on a route beyond their full strategic control. Today, this concern applies broadly to major Asian economies. As one of the busiest maritime routes globally, Malacca carries vast volumes of oil and manufactured goods. Even without a formal blockade, rising piracy, military exercises, or geopolitical tensions can significantly increase operational costs. India, Japan, South Korea, and China depend on the route in varying degrees, highlighting a shared vulnerability. Without adequate strategic reserves or alternative supply routes, disruptions at chokepoints can rapidly escalate into economic crises.

Developments in the Red Sea and the Bab el-Mandeb Strait further demonstrate how maritime disruption no longer requires conventional naval superiority. Attacks by Houthi forces, supported externally, compelled many commercial vessels to reroute around the Cape of Good Hope, substantially increasing transit time, fuel consumption, and insurance expenses. These incidents underscore how relatively limited resources can sustain prolonged disruption to global trade networks.

In this evolving environment, risk itself has become weaponised. Insurance now functions as an extension of the battlefield. Governments are increasingly compelled to act as insurers of last resort, providing guarantees, financial support, and logistical backing once private insurers withdraw. Consequently, trade costs are no longer determined solely by market forces, but are shaped by diplomacy, conflict dynamics, and strategic rivalry.

Energy policy is also undergoing a significant transformation. Many countries are shifting away from just-in-time supply systems toward larger inventories and expanded strategic reserves. Simultaneously, the case for energy transition is gaining renewed strategic justification. Renewable energy sources such as solar and wind power are no longer viewed solely through the lens of climate policy but increasingly as instruments of national security. However, this transition is likely to remain uneven. Wealthier nations possess the fiscal capacity to accelerate diversification, while developing economies may continue relying on coal and other short-term energy solutions.

The broader implication is clear: while geography remains unchanged, its economic consequences have intensified. Maritime routes once considered stable commercial arteries have become instruments of coercion, competition, and strategic risk. The world appears to be entering an era in which control over chokepoints may matter as much as traditional military strength.

The crisis in the Strait of Hormuz, therefore, extends far beyond the Gulf region — it serves as a warning that the global economy now operates within a more fragile and contested maritime order.

Ravindra Garimella, a parliamentary bureaucrat and former Joint Secretary (Legislation), Lok Sabha Secretariat. Kush Sharma is a policy consultant and geopolitical analyst.

Disclaimer: The views expressed above are the author's own. They do not necessarily reflect the views of DH.