Ormuz Strait

The Strait of Hormuz is a narrow waterway strategically located between Oman and Iran, connecting the Persian Gulf to the Gulf of Oman and the Arabian Sea. It is a critical chokepoint for global oil supplies, with approximately 20% of the world's oil trade passing through it. Recent escalations in Middle East tensions have directly impacted the Strait, raising concerns about potential disruptions to energy markets. These tensions, coupled with the ongoing war in Ukraine, highlight the fragility of the global energy system and the Strait's geopolitical significance. The possibility of a blockade or disruptions in the Strait have led to increased oil prices and boosted the value of oil companies. The situation underscores the need for energy sovereignty and diversification, including the development of green and renewable energy sources, to mitigate reliance on this volatile region.