Hormuz Threatens Indo-Pacific Security

In late February, Iran’s Islamic Revolutionary Guard Corps (IRGC) moved to close the Strait of Hormuz, issuing warnings that “if anyone tries to pass, the heroes of the Revolutionary Guard and the regular navy will set those ships ablaze.” By targeting ships with drones and antiship missiles and laying mines, Tehran has choked off oil exports from the Middle East and sent energy prices soaring. The control of waterways has long been used to thwart adversaries and shape strategic outcomes. In 1951, after Tehran nationalized its oil industry, the United Kingdom used naval pressure to prevent Iran from exporting oil. During the 1984 “tanker war,” Iran laid mines in the Strait of Hormuz and harassed ships in response to Iraqi attacks. Throughout both these conflicts, however, the Strait of Hormuz remained in use. What the current Hormuz crisis makes plain is that closing a strait has become easier and the consequences more far-reaching. Relatively inexpensive technologies—including coastal surveillance systems, shore-based antiship missiles, drones, uncrewed surface vessels, and mines—now allow weaker states to disrupt at scale and impose costs on stronger adversaries. At the same time, the concentration of global trade and energy flows through a handful of narrow routes has magnified the impact of localized crises. Critically, the U.S. and Israeli strikes on Iran and U.S. President Donald Trump’s subsequent threat to blockade the Strait of Hormuz suggest a greater willingness by major powers to impose extensive economic costs and disregard international law, including the rules governing transit. A waterway, moreover, need not actually be closed to cause extensive pain: the mere threat of disruption is enough to raise insurance premiums, reroute shipping, and unsettle commodity markets. For Asia, the stakes are higher still: whereas Hormuz is largely an energy chokepoint, Asia’s waterways sit astride global trade, energy, and semiconductor supply chains. By demonstrating both the feasibility—even for a weaker power—of weaponizing a chokepoint and the willingness of powerful states to impose and tolerate widespread costs, Hormuz could encourage similar tactics across the Indo-Pacific. This could take the form of U.S. restrictions on access through the Strait of Malacca, a Chinese blockade of the Taiwan Strait, or U.S.-Philippine denial of access through the Luzon Strait. Pressure on these primary chokepoints could in turn extend to secondary waterways. Recent developments in the Indonesian archipelago, which have largely gone under the radar, suggest that both Washington and Beijing are more keenly anticipating disruptions and maneuvering to contest Asia’s secondary maritime corridors. After U.S. and Israeli strikes in late February, Iran did not merely retaliate with kinetic attacks. The IRGC also established a highly structured toll system in the Strait of Hormuz that required vessels to submit documentation and pay fees in order to pass. While unconfirmed reports emerged of at least one vessel paying $2 million to transit the strait, many shipping companies have publicly insisted that they will not pay fees, citing the “principle of navigation based on international law.” In mid-April, after negotiations to end the war and reopen the strait broke down, Trump declared the U.S. Navy would blockade “any and all Ships trying to enter, or leave, the Strait of Hormuz.” The declaration raised immediate legal concerns under both the UN Convention on the Law of the Sea and the law of armed conflict at sea, which governs naval warfare and conduct toward neutral shipping. For straits that are 24 nautical miles wide or narrower, such as the 21-nautical-mile-wide Strait of Hormuz, the regime of “transit passage” under UNCLOS grants ships and aircraft the right of unimpeded navigation and overflight. Although the United States has not acceded to UNCLOS, which came into force in 1994, it generally accepts its core provisions as reflecting customary international law. Even during armed conflict, nonbelligerents maintain their maritime rights. The law of armed conflict at sea recognizes only limited exceptions under which belligerents may stop and inspect vessels suspected of carrying prohibited goods. Operational guidance from U.S. Central Command (CENTCOM) subsequently narrowed the president’s directive. The blockade would be enforced impartially against vessels of all countries entering or departing Iranian ports, while not impeding freedom of navigation for vessels transiting the strait to and from non-Iranian ports. By applying the blockade impartially to vessels of all countries entering or departing Iranian ports and preserving transit rights for vessels traveling to and from non-Iranian ports, CENTCOM’s order was carefully calibrated to be legally defensible. In contrast, Iran’s actions and the U.S. president’s maximalist position clearly contravene both UNCLOS and the law of armed conflict at sea. A blanket ban on vessels transiting the strait is inconsistent with the right of transit passage and not permitted under the law of armed conflict at sea. Nor does the nonpayment of transit fees constitute a lawful ground for targeting neutral vessels. Nowhere are the consequences of weaponizing straits likely to be greater than in Asia. The Strait of Malacca, a mere 1.5 nautical miles at its narrowest, carries up to 40 percent of global trade and 80 percent of China’s energy imports. Bypassing it requires diverting through Indonesia’s secondary waterways or around Australia, adding significant time, cost, and risk. In 2003, Chinese President Hu Jintao described China’s vulnerability to a blockade of this route as the “Malacca dilemma.” Recent events in Hormuz sharpen this concern. Beijing will likely intensify its plans to reduce its dependence on the Malacca Strait by expanding overland pipelines through Myanmar, Russia, and Central Asia; increasing its Indian Ocean port access; and developing Arctic shipping routes. Disrupting this vital artery would have ramifications for countries well beyond China. The Strait of Malacca is the primary maritime corridor linking East Asian manufacturing hubs to markets in Europe and the Middle East; its closure would sever critical global supply chains, trigger macroeconomic shocks, and hurt the U.S. economy. Previously, one might reasonably have assumed that Washington would hesitate to disrupt passage through the strait given the extensive economic consequences. The Hormuz crisis, however, suggests that such considerations now carry less weight. The U.S. and Israeli attacks on Iran were undertaken with little regard for the broader fallout, including the impact on allies and partners, while the U.S. blockade, even in the narrower CENTCOM form, contributed to spikes in global energy and food prices. Hormuz also highlights how straits can be monetized for leverage. Although the Strait of Malacca’s littoral states have no incentive to close the waterway, charging for passage—perhaps under the guise of an environmental levy—is another matter. Singapore captures the lion’s share of the commercial value of passage through its port and transshipment services, but a nationalist or populist government in Indonesia or Malaysia might decide to extract rent from commercial shipping. Recently, Indonesia’s finance minister suggested that Indonesia might charge tolls for passage, although the foreign minister quickly walked the statement back. As in the Strait of Hormuz and the Strait of Malacca, disruptions in the Taiwan Strait, through which 20 percent of global maritime trade passes, would threaten global trade. But a blockade in the Taiwan Strait poses a distinct risk. Taiwan remains the world’s dominant producer of advanced semiconductors, and a blockade would restrict its energy and raw materials imports and halt exports of chips critical to global supply chains. Unlike China, which is building alternative routes to reduce its dependence on the Malacca Strait, Taiwan lacks a geographical bypass: its major ports are concentrated along its west coast, facing the strait, and its mountainous interior complicates east–west transport. In the event of a blockade, tech industries and defense production worldwide would be paralyzed. According to Bloomberg, 5.3 percent of global GDP could be erased. Beyond their potential for widespread economic disruption, these waterways also provide distinct military and operational advantages. As Hormuz demonstrates, the control of adjacent territory provides a significant edge, especially in narrow straits. Using coastal radar, shore-based missiles, drones, uncrewed surface vessels, fast attack boats, and mines, Iran has demonstrated the ability to restrict access and impose costs on a superior military, complicating broader U.S. war aims. These tactical realities have already shaped military postures in Asia. Developments in Hormuz validate China’s anti-access/area-denial (A2/AD) strategy, which seeks to restrict and complicate adversary operations in the waters surrounding China through layered missile, naval, air, and surveillance systems, and Taiwan’s “porcupine” approach, which emphasizes dispersed, mobile systems designed to repel an invasion. Although the Taiwan Strait is much wider than Hormuz—around 70 nautical miles at its narrowest—and therefore requires longer-range capabilities, the underlying principle applies: straits are strategic assets that may effectively be weaponized. Indeed, farther south, U.S.-Philippine exercises have focused on developing localized denial capabilities in the Luzon Strait, which links the South China Sea to the Pacific and whose depth allows submarines to transit undetected. The strait is a critical gateway for commercial shipping and naval movement between East Asia and the wider Pacific and would become an essential alternative route if transit through the Taiwan Strait were disrupted. Beijing recently responded to these exercises with live-fire exercises, highlighting the strait’s strategic significance. Because both the Taiwan and Luzon straits are wider than 24 nautical miles, they contain continuous exclusive economic zone corridors where high seas freedoms apply. Blockading these corridors or unjustifiably interfering with transit through them clearly violates international law. Yet the military activities in and around both straits suggest that the strategic value of controlling access to them is likely to outweigh legal constraints in a crisis. Any disruption in high-traffic straits increases pressure on secondary routes, creating new vulnerabilities. If the Strait of Malacca were constrained, traffic would have to divert through the Indonesian archipelago, including the Sunda Strait, between Sumatra and Java, and the Lombok Strait, a deep-water trench between Bali and Lombok. Both Beijing and Washington appear to be more keenly anticipating disruption in primary chokepoints and are quietly maneuvering for advantage in these waters. In early April, Jakarta discovered an unmanned underwater vehicle of suspected Chinese origin in the Lombok Strait, suggesting increased Chinese attention to this waterway. Transit in archipelagic waters is governed by archipelagic sea-lanes passage under UNCLOS, which guarantees continuous, unimpeded navigation and overflight in “normal mode” (meaning submarines may remain submerged) through state-designated corridors or routes “normally used for international navigation.” Outside these corridors, vessels (but not aircraft) enjoy only “innocent passage,” which may be suspended when “essential” for security and requires submarines to surface. The concentration of traffic into predictable corridors makes vessels and aircraft easier to track and target. Recognizing this vulnerability, Washington has sought a blanket overflight agreement with Indonesia to secure access to alternative routes. The sensitivities surrounding this deal are acute. In mid-April, just days before the operational agreement was to be signed, an Indian media outlet leaked news of the deal. Indonesia’s foreign ministry cautioned the defense ministry that the agreement risked creating “the impression that Indonesia is involved in an alliance” and could entangle it in “a regional conflict situation,” including a South China Sea conflict. The deal’s fate is now unclear. Beijing, meanwhile, has warned that the arrangement could violate the Charter of the Association of Southeast Asian Nations. States that depend on open transit cannot assume that the norms governing strategic waterways will simply endure in the face of assault. The United States and its allies and partners must take urgent action to reduce vulnerabilities in Asia’s chokepoints. Washington and its allies and partners should further bolster maritime domain awareness and response capabilities in Taiwan and other key maritime states, including Indonesia, Malaysia, and Singapore, which hosts U.S. logistics facilities, to detect and deter activities aimed at disrupting strategic waterways, such as the laying of mines. Washington and its allies should also coordinate on maritime operations designed to maintain transit through contested straits during crises. This would signal that attempts to restrict transit will be met with a collective response. To address the concentration of maritime traffic, particularly through the Malacca, Taiwan, and Luzon straits, Washington should also work with its allies and partners to upgrade secondary deep-water ports in the Philippines, Vietnam, and along India’s eastern seaboard. If the Strait of Malacca is disrupted, these ports will serve as important refueling stops for shipping diverted through the Indonesian archipelago. U.S. efforts to decentralize advanced semiconductor production to allied countries, such as Germany and Japan, must also be redoubled to reduce global dependence on semiconductor production concentrated in Taiwan. To maximize deterrence, Washington and its allies could pre-commit to economic sanctions in response to unlawful disruptions to transit through major waterways in Asia. Many of these measures are already underway, but events in the Strait of Hormuz underscore their urgency. Executing them requires diplomatic capital—a resource in short supply as Washington’s fallout with allies and partners undermines the coalitions needed to sustain open access. In addition to these collective measures, Washington should strengthen its legal and diplomatic position by finally joining UNCLOS—a recommendation routinely ignored but no less important. The United States must also align its rhetoric and practice with international law. Together, these steps would strengthen U.S. credibility when contesting actions that undermine maritime rights and signal a renewed commitment to the rules governing strategic waterways. Tehran has discovered the cheap, fast, and devastating leverage it has in the Strait of Hormuz. The warning for Asia is real: absent a sustained defense of transit rights and the freedom of the seas—and robust pushback against those who undermine them—similar dynamics could unfold across the Indo-Pacific. Given the sheer volume of global trade dependent on uninterrupted passage through regional chokepoints, the weaponization of Asia’s waterways would trigger catastrophic consequences. Subscribe to Foreign Affairs to get unlimited access.