The world’s most important oil supply route, the Strait of Hormuz, is now in trouble due to the double blockade. First Iran closed it and now America under the leadership of Donald Trump has also decided to ban the movement of ships here. This step has deepened the global energy crisis and has created a big challenge for countries like India.
What is the whole matter?
Iran had earlier closed the Strait of Hormuz after the US-Israel attacks. After this, America also took retaliatory steps and imposed a blockade on the ships passing through here. Although the US Army clarified that only the ships connected to Iran’s ports will be affected, but it is certain to have an impact on global trade.
Why was there panic in the world?
The Strait of Hormuz is one of the busiest oil routes in the world. Due to the blockage here, oil prices increased rapidly and a decline was seen in the international markets. Even before this, Iran’s blockade had already created an energy crisis, now the American move has made it more serious.
Why a big concern for India?
India imports more than 85% of its crude oil needs and a large part of it comes from Gulf countries, which passes through this route. In such a situation, the blockage in Hormuz is directly affecting India’s supply chain.
Relief from relations with Iran
However, due to India’s good old relations with Iran, some Indian ships were allowed to pass even amidst this crisis. India clarified that it did not pay any fee for safe passage, but this was possible because of relationships.
Another look at oil purchases from Russia
Amidst this crisis, India has tried to start buying oil from Russia again, but the concession given by America for this has ended on April 11. Now India is demanding to increase this exemption, but no official announcement has been made yet.
Role of China and other countries
China is already a big buyer of Iran’s oil and it is not clear whether the US will take strict action against ships belonging to China or not. According to some reports, Iran is also charging ships in exchange for safe passage, which has further increased the tension.
Big diplomatic challenge before India
If permission is not received from America and India continues to buy oil from Russia, then relations with Washington may be affected. Especially when the trade deal is being negotiated between the two countries and the tariff dispute has already come to the fore.
What next?
This double blockade in Hormuz has become a big threat not only to the global economy but also to India’s energy security. In the coming days, India will have to take diplomatic and economic decisions by maintaining balance.