After the Trump administration announced an end to Iranian sanction waivers, the country’s Revolutionary Guard force threatened to close the Strait of Hormuz, a strategic choke point at the mouth of the Persian Gulf. The EIA estimates that in 2016 around 18.5 million barrels of oil traveled through the Strait of Hormuz each day. Stopping up the strait would lead to a major economic shock. Reuters reports on the threat:
Tehran is prepared for a U.S. decision to end waivers granted to buyers of Iranian crude, an Iranian oil ministry source said on Monday, as the Revolutionary Guards repeated their threat to close the strategic Strait of Hormuz, Iranian media reported.
The United States will fail to cut Iranian oil exports to zero, the semi-official Tasnim news agency on Monday quoted an unnamed Iranian oil ministry source as saying.
U.S. President Donald Trump has decided not to reissue waivers in May allowing importers to buy Iranian oil without facing U.S. sanctions, the White House said in a statement on Monday.
Can Iran close the strait? In 2018 Michael Ratner of the Congressional Research Service wrote “experts assess this to be a low probability event. Moreover, were this to occur, it is not likely to be prolonged.” Read his full report below.