LANGUAGE: ENGLISH

Executive Summary

The article evaluates the strategic relevance of the Strait of Hormuz. Until the outbreak of the Iranian Revolution, the Strait was not considered to be of a global strategic relevance. The Iranian decision to use the threat of closure of the Strait has led to sharp spikes in oil prices and cancellation of shipping. As a result, some oil-exporting nations took measures to bypass the Strait of Hormuz (i.e. the East - West pipeline). But currently the Strait remains of strategic relevance since every threat by Iran to close it results in market panic. For the future, demand for oil is set to significantly decline by 2050. To counter this loss of income the Gulf states are investing heavily in developing hydrogen technology which would indicate a continuing requirement for sea transport in the region in the future. Shrinking oil demand will result in growing competitiveness amongst major oil exporting countries. For example, it would make economic sense for Saudi Arabia and Oman to cooperate in constructing a pipeline direct to the Indian Ocean creating a competitive edge over GCC neighbours. The article concludes that the future strategic relevance of the Strait will continue to be determined by the priority energy exporting countries place on establishing ports of export that bypass the Strait of Hormuz.

​

​

The Strait of Hormuz

The Strait of Hormuz is a narrow waterway linking the Persian Gulf[1] to the Sea of Oman. It carries 30% of global LNG and 20% of global oil production from the Gulf to the Indian Ocean. It is bounded to the south by the mountainous Musandam Peninsula of Arabia. To the north lie the low hills of the Iranian Hormuz Region, which rise steeply up to the Persian plateau a few miles inland.

 

The Strait of Hormuz is 24 miles wide (between offshore islands) at its narrowest point and averages about 100 metres in depth. It is at its deepest, 200 metres, on the southern Musandam coast and shallows northward towards Iran (The English Channel is 22 miles wide at its narrowest and never more than 50 metres deep). The current runs through the Strait along the Iranian coast and then turns south to form an anti-clockwise circulation. The Gulf waters evaporate faster than they are replenished by the Tigris and Euphrates rivers producing a constant movement through the Strait from the Sea of Oman. Local inshore currents can reach 6km/hr and create tricky conditions for smaller vessels. Despite this, the Strait has remained the principal route for trade and passenger traffic through the centuries.

​

[1] Historically referred to as the Persian Gulf, it is commonly described by Arab countries as the Arabian Gulf. This paper will use the simple term Gulf.

 

​

The Gulf

The Gulf is a shallow marginal sea of the Indian Ocean between the Arabian Peninsula and southwestern Iran. Northwest to Southeast, it extends at about 600 miles and 200 miles wide at its broadest point. The average water depth is 35 metres and it is of high salinity, as there is inadequate freshwater inflow. The Iranian coast is mountainous, whilst the Arabian shore is largely low-lying sand and salt marsh (Sabkha). Thus, the principal conduit for trade and passenger traffic has traditionally been the sea.

 

The Gulf marks a major ethnic division between the Arabian and Iranian peoples. There is also a religious divide, with the Arabs largely following the Sunna tradition and Iranians subscribing to the Shia.

​

​

The Past

The ethnic differences noted above were not as stark in the past. The Abbasid Dynasty straddled both sides. When ousted by the Qarmations in the 10th Century CE, it continued much the same under new management. Qarmatian control stretched to Kufa just south of Baghdad; their reach extended to Mecca and Medina, which they sacked in 930 CE, stealing the Black Stone of Islam and extorting a high ransom for its return. They robbed and pillaged Haj pilgrimage groups. However, the principal sources of income were the payment of tributes from their vassal territories and neighbours, payments for rite of passage and cargo levies. Their control of the region was total, and the Strait of Hormuz had no strategic importance.

 

For most of its history, the maritime passage through the Gulf acted as a secondary but significant trade route linking the Indian Ocean to the land route to Syria and the Mediterranean. The Silk Road to the north was a primary trade conduit from Asia towards Europe. The other major trade route was running through the Red Sea to Egypt. The famed Frankincense Caravans from Dhofar in southern Oman used both the Red Sea and Gulf routes, principally through the Red Sea. The Gulf passage acted as a source of income for its suzerain states.

 

The arrival of the European powers changed this. Piracy had been on the rise for some time, principally generated by the Makran Baluch, who exerted significant control over the maritime trade routes, attacking and robbing shipping as well as exacting tributes as payment for secure rites of passage. The Portuguese arrived first, constructing fortifications along the Gulf of Oman and on the Island of Hormuz in the Strait. Over the next two centuries, the European powers vied to secure a trading advantage with local rulers. The consolidation of the British Raj in India created new strategic imperatives for them.

 

A Ras al Khaimah tribe, the Qawasim, had developed powerful maritime forces which were adept at attacking shipping. They would attack in swarms of 12 to 20 vessels that were fast, highly manoeuvrable, and shallow draft. British warships were designed and built to withstand Atlantic storms. The nimble Qawasim craft easily outmanoeuvred them, and the British could not follow them into the shallow waters and salt marsh inlets of their coastal hideouts. When the Qawasim started attacking shipping off the west coast of India and back in the Gulf forming a loose association with the Wahabi, action had to be taken.

 

In February 1806, the British forced Sheikh Sultan bin Saqr to sign a Qawlnamah committing the Qawasim to keep peace at sea and to respect the property of the East India Company. This had little effect; nor did a punitive British raid on Ras al Khaimah in 1809. By 1819, the British had had enough. On 9th December, they inflicted a decisive defeat on the Qawasim. Three months later, all tribal sheikhs had signed up to The General Treaty of January 1820. The sheikhs ruling the seven constituent states were bound by truces concluded with Great Britain in 1820 (and an agreement made in 1892 accepting British protection). It lasted, without serious challenge, for 150 years until the British withdrew in 1971. It also gave birth to their name, the Trucial States.

 

The British strategic imperatives which drove policy until the 20th century had three prime goals. The first goal was concern over Russian ambitions; it was paramount for Britain to keep Russia out of Imperial India. This meant ensuring that they did not establish a foothold in Iran and by implication, keeping potential adversaries such as France out of Iran. The second imperative was to secure the land route from London to India which included safe passage through the Gulf and Strait of Hormuz. This was reinforced by the laying of the London Karachi telegraphic communications cable in 1864 through the Persian Gulf and across the Musandam Peninsula (later re-rooted through the Strait). The third imperative was simply protecting and promoting British trade interests in the region.

 

In 1911 the Anglo-Persian Oil Company commenced oil production in Iran. Commercial exploration and production escalated in the 1930s with competition between UK and the USA to establish secure sources of oil. Momentum increased in the 1950s and countries while still technically depended on Britain for their security began to earn large incomes. Vast wealth began to accumulate in the Gulf countries and major infrastructure development began to take place in the Arabian gulf area. By 1971, the Strait of Hormuz saw 20% of all global oil production passing through daily.

 

Despite its strategic significance, the withdrawal of British forces in 1971 did not attract the concern that it might today. At that time, it was by no means certain that the Gulf would remain as the key provider of hydrocarbon energy sources. There was confidence that global oil and gas exploration would soon leave the Gulf as just another provider. Strategic analysis of potential implications of the Strait of Hormuz checkpoint would not have raised great concerns. On the south side of the Strait, the Musandam peninsula was part of the Sultanate of Oman, a close ally of the UK, whose leader, Sultan Qaboos was Sandhurst trained. The northern shores of the Strait were Iranian, whose leader Mohammed Reza Pahlavi was a close ally of the West. He equipped the country with western-sourced weapons and was seemingly edging Iran to becoming a secular nation. It seemed there was no reason for concern. Iran held celebrations commemorating the 2500 years anniversary of the Persian Empire. Who could have foreseen that the throne would fall to fundamental Islamists less than eight years later.

​

​

The Present 1971 – 2022

On 13 November 1971, shortly after the withdrawal of British forces, Iranian forces seized the Gulf islands of Abu Moussa and the Tunbs (lesser and Greater), and Arabs on the islands were expelled; the attack occurred despite having signed an agreement for joint jurisdiction with the Emirate of Sharjah only the day before. This caused great anger and mistrust particularly in the fledgling UAE which was formed only two days later. The next few years saw the creation of immense wealth for the Gulf monarchies but their seemingly amicable relationships with Iran were tinged with suspicion. Iran, at that time a powerful military nation dominated the northern coast of the Strait of Hormuz. In January 1979 the Iranian revolution deposed the Imperial Monarch and replaced it with an Islamic fundamentalist regime with a Muslim cleric at its head. Overnight, a close US ally had become a likely adversary; Military planners would now have to rate the Strait as a strategic chokepoint and potential global flashpoint. The US were still part dependent on gulf oil imports at that time so they could not ignore potential threats to their oil supply. 

 

The Iranian revolutionary government was initially preoccupied with establishing internal stability and credibility whilst externally at war with Iraq. However, in April 1988 an American warship struck a mine in the Strait. The US responded by sinking an Iranian frigate, a gunboat, and a number of armed speed boats. The relationship deteriorated further in July 1988 when an American cruiser shot down an Iranian commercial airliner having mistaken it for an Iranian warplane.

 

In June 2008, a senior Iranian commander threatened to close the Strait of Hormuz to all shipping. This was the first time that the threat was made. On many other occasions, the threat in itself was sufficient to deter commercial shipping temporarily and spike the oil prices. Whether the Iranians had the military capability to do so is open to doubt. The Iranians knew that conventional warfare against the US was out of the question. For some years they had been developing asymmetric capabilities, equipment and tactics. Their so-called swarm tactics involved launching large numbers of armed speed boats from multiple directions against military targets transiting the Strait, thus overwhelming their close-in defence systems. 

 

This form of harassment was used on numerous occasions but never in deadly earnest. From the beginning, the Iranian posture had been that the Strait belonged to them and they were free to police it as they willed and that they had the capability to enforce it.  Initially this confident assertion was treated lightly, but Iranian developments in drone and missile warfare forced allied navies to review their close-in capability against multiple simultaneous targets. However, the bottom line is that any deadly attack against a warship is tantamount to a formal declaration of war. Any such attack against a commercial vessel would leave an undeniable footprint and consequences that would outweigh any benefit.

 

Currently, Iranian focus has shifted away from the Strait of Hormuz since it seized a South Korean tanker in January 2021. There have been a number of incidents in the Sea of Oman close to the UAE port of Fujairah. The most recent was an armed boarding and attempt to force a commercial vessel to head to the Iranian port of Bandar Abbas. It was thwarted by US and UK forces. 

 

Oil exporting nations in the region have given considerable thought to creating alternatives to shipping oil through the Strait of Hormuz. Consideration was given to constructing a canal across the north of the Musandam Peninsula but was discarded because it was considered too close to Hormuz to provide a viable alternative. In 2008, the UAE looked at the construction of a canal cutting across the UAE to Fujairah. It was costed at $200 billion US. The decision was then taken to build a pipeline instead which is now operating and carries 2 million barrels daily. In 2012, Saudi Arabia considered constructing a canal through the Empty Quarter desert to the coast of Yemen, A distance of 950 miles. This was also discarded. Instead, they have decided to increase the capacity of the east-west pipeline to Yanbu on the Red Sea coast from 5m to 7m barrels daily. Elsewhere, tanker storage farms are being constructed in the UAE and Oman. The UAE storage site at Fujairah will hold 14m barrels. These projects are intended to ease any interruption of oil flow through the Strait. Slowly but surely, Gulf nations are finding alternative options to shipping oil through the Strait.

 

Is it therefore still strategically relevant? It is fair to conclude that it remains a strategic bottleneck with global implications. At current output levels, a significant proportion of Gulf oil must still be carried through the Straits of Hormuz. Is the armed closure of the Strait a real option for the Iranians? The answer is no. The repercussions would be too great. If a naval group successfully forced the Strait, Iranian credibility would be seriously damaged. The repercussions from its Gulf neighbours and customers outside would outweigh any political leverage gained. In any event, the status quo works to Iran’s advantage. Bellicose threat of closure from Tehran tend to deter commercial shipping from attempting the passage the passage through the Strait without need to resort to the military option

​

​

The Future 2022 

The Gulf energy producing states have responded positively to the call to move away from hydrocarbon. They have published net zero targets in the 2050 to 2060 period. The UAE has an operating nuclear power plant. Saudi Arabia has plans to complete construction of two nuclear plants within the next 10 years. It also has an active program to research and develop hydrogen production from nuclear energy. Oman has large solar energy projects in construction and production. All are devoting resources aimed at creating hydrogen production in the region. However, they see this as being completely separate from continuing production and export of gas and oil for as long as a demand exists. 

 

A year ago, there was an assumption of continuing decline in US dependence on Gulf oil and concomitant weakening of US foreign policy interest in the region as priority shifted to the Pacific. There was a lack of political unity across the region with Qatar as a pariah state and Oman forging an independent foreign policy path from the main GCC players. However, the past few months have seen great change with the reinstatement of Qatar and a remarkable rapprochement between Oman and Saudi Arabia. The recent al Houthi missile attacks on the UAE have brought a strong US interest in the stability of the Region.

 

Hitherto, Oman has been very cautious in its approach to relations with Saudi Arabia. Muscat has viewed with suspicion Saudi territorial ambitions towards their Indian Ocean access. Any discussion over a Saudi oil or gas pipeline and export facility direct to the Indian Ocean has been declined. Oman has long memories of Saudi support for the 1956 Oman Imamate insurrection against the Sultan and the so-called Buraimi Incident in which Saudi Arabia seized Oman land. The last few months have seen a transformation. The first road link between the two countries has now been opened. The Oman National press has been openly discussing the economic benefits of the Saudi principal energy export pipelines being constructed to connect to the Oman Indian Ocean port of Duqm (a sure sign of government approval). The Oman Railway project to to connect the Oman ports of Salalah and Duqm with the GCC states has sprung back into life.

 

The future sees a declining demand in hydrocarbon products from the Gulf region to, if Nations hold to their timetable targets, minimal fossil fuel requirements by mid-century. This appears to mitigate against the logic of investing in a multibillion-dollar pipeline through Oman. Additionally, the record of sustained unity among the Gulf nations is dismal. Amal is already concerned about the relationships that Saudi Arabia and the UAE are creating in the mirror region of the Yemen adjacent to the adjacent to the Oman border. Oman is determined not to become a client state of Saudi Arabia or the UAE. It is realistic to conclude that the current situation will continue. Any bellicose threat by Iran to close the Strait of Hormuz will be met by a panic spike in oil prices, soon settling down. This itself will create a strategic impact globally. At some stage, as fossil fuel demand decreases, the Strait of Hormuz will lose in strategic importance. 

 

However, if the future wealth of the Gulf states is to be founded on the production and export of hydrogen, there will be a need for transport ships. Hence, the economic case for pipelines connecting to the Indian Ocean ports will be strengthened. There are technical challenges with hydrogen and pipelines which should be overcome. However, given a decrease in the demand for fossil fuels and increasing competition between providers, export from an Indian Ocean port could give Saudi Arabia a commercial edge over its competitors such as Qatar which will be three days sea passage behind.

 

 

 

​