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South Korean Flagged Chemical Tanker Seized by Iran in Strait of Hormuz - a Vital Oil Chokepoint

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On January 4th, the Islamic Revolutionary Guard Corps of Iran seized a South Korea-flagged ship carrying petrochemicals in the Strait of Hormuz.

The vessel was carrying 7,200 tons of chemicals, primarily methanol.

The ship, the tanker Hankuk Chemi, was traveling from Al-Jubail, Saudi Arabia, to Fujairah in the UAE when armed Revolutionary Guards overtook it.

Once onboard, they forced the ship to change direction and sail northwards into Iranian territorial waters.

The MT Hankuk Chemi has twenty crews; five from South Korea, eleven from Myanmar, two from Indonesia, and two from Vietnam.

The crew members are in custody at the port city of Bandar Abbas near the Strait of Hormuz.

Iran's Revolutionary Guard Corps troops on Jan 4th seized the South Korean-flagged MT Hankuk Chemi

Iran's Revolutionary Guard Corps troops on Jan 4th seized the South Korean-flagged MT Hankuk Chemi

Tensions Intensifying in the Gulf

Iran's seizure of the Hankuk Chemi comes as Tehran compels South Korea to release $7 billion of Iranian money frozen in South Korea banks due to US sanctions.

However, for South Korea to release that amount, it must apply for a waiver from the US government, or the US must return to the JCPOA.

The seizure is the latest in a series of naval incidents raising tensions in one of the world's most vital shipping lanes.

The ship seizure along the crucial Strait of Hormuz is also the latest in a series of escalations as President Trump's term draws close.

On January 4th, Iran announced it has ramped up uranium enrichment at its Fordo nuclear facility to 20%. The increase in enrichment level brings it a technical step away from weapons-grade purity levels of 90%. Uranium enriched to 90% is required to fuel nuclear weapons.

Meanwhile, January 2nd marked the first anniversary of the assassination of General Qassem Soleimani, commander of the Iranian Revolutionary Guard Corps' elite Quds Force, in a US drone attack.

In a show of force, the US deployed military assets to the region, including returning the nuclear-powered aircraft carrier USS Nimitz and repeated sorties of strategic B-52 bombers over the Persian Gulf.

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Where is the Strait of Hormuz

The Strait of Hormuz connects the Persian Gulf with the Gulf of Oman and the Arabian Sea.

Shaped like an inverted V, the waterway connects Iran to the north and Oman & the UAE to the south.

It's almost 100 miles long and 21 miles wide at its narrowest point.

However, the shipping lane's width in either direction is only two miles, separated by a two-mile buffer zone.

Its shallow depth, unfortunately, makes ships vulnerable to mines. Its proximity to Iran leaves large tankers susceptible to interception by Iranian speed boats and helicopters.

The Strait of Hormuz is a narrow waterway between the Persian Gulf and the Gulf of Oman

The Strait of Hormuz is a narrow waterway between the Persian Gulf and the Gulf of Oman

Why is the Strait of Hormuz Important

The Strait of Hormuz is the world's most important oil chokepoint because of the large oil volumes that flow through it.

Tankers hauled nearly 12 million barrels per day of oil through it in 2020

According to the US Energy Information Administration, about 21 million barrels per day of oil passed through the Strait of Hormuz every day in 2018 & 2019.

The strait is also essential for liquefied natural gas, with a quarter of the world's supply mostly from Qatar passing through annually.

Through this chokepoint, oil flows accounts for roughly 30% of all seaborne traded oil or almost 20% of oil sold worldwide.

Who Relies Most on the Strait of Hormuz

The Strait of Hormuz is vital because it is a geographic chokepoint and the primary conduit for oil exports from the Middle East to Asia.

Two-thirds of the crude oil and LNG exports that pass through the strait go to China, India, Japan, Singapore, and South Korea.

Most of the oil exported from Saudi Arabia, Iran, Kuwait, the United Arab Emirates, Bahrain, and Iraq passes through the strait.

It is also the route for all the liquefied natural gas (LNG) exports from Qatar.

Qatar's main port for LNG exports is Ras Laffan. Kuwait's key port for its oil exports is the Mina al-Ahmadi. The UAE's primary port is the Port of Fujairah. Saudi Arabia's chief port is the port of Ras Tanura. Iran's main ports are terminals at Lavan and Kharg Islands.

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Alternative Routes to Bypass the Strait of Hormuz

Closure of the Strait of Hormuz would require the use of alternate routes at increased transportation costs.

So far, only the UAE and Saudi Arabia can bypass the Strait of Hormuz.

Saudi Arabia operates the 746-mile Petroline, also known as the East-West Pipeline. The Pipeline can transports crude oil from Kingdom's eastern fields to the Red Sea at Yanbu, bypassing the Bab al-Mandeb and the Strait of Hormuz. The Pipeline can carry about 5 million per day of the Kingdom's oil exports.

The UAE also operates the 220 mile Abu Dhabi Crude Oil Pipeline. The 1.5 million barrels per day pipeline runs from its oilfields in Habshan to Fujairah's port on the Gulf of Oman. The pipeline was attacked in May 2019 by an unmanned aerial vehicle carrying explosives, shutting it down briefly.

south-korean-flagged-chemical-tanker-seized-by-iran-in-strait-of-hormuz-a-vital-oil-chokepoint

Why Iran Would Disrupt Shipping

In response to the extensive US sanctions, Iran would disrupt shipping along the Strait of Hormuz.

US sanctions intended at stopping oil sales have wrecked Iran’s economy since 2018. Iran’s economy, highly reliant on oil exports, has almost collapsed. Inflation was 44.8% in December 2020.

Disrupting the strait demonstrates that Iran can inflict pain in return on the US and its allies by reducing energy flow and driving up prices.

For many years, Iran has threatened that if they cannot export crude oil due to US sanctions, no one else would either.

However, If Iran blocks the Strait of Hormuz, it will undoubtedly destroy its economy. Unlike Saudi Arabia and the UAE, Iran cannot bypass the Strait of Hormuz.

Can the United States Defend the Strait of Hormuz

In response to the multiple against oil tankers and ships by Iran, America formed the international Maritime Security Construct.

It is a coalition tasked with maintaining order and security in the Gulf of Oman, the Persian Gulf, the Gulf of Aden, and the Red Sea.

Nations, including Australia, Bahrain, Britain, and the UAE, have joined the alliance to prevent naval harassment and illegal seizure of vessels by Iran.

The United States has tens of thousands of troops stationed across the Persian Gulf.

US troops stationed across the Persian Gulf

US troops stationed across the Persian Gulf

How Likely is Iran to Shutdown the Strait of Hormuz

The US Navy could quickly destroy the Iranian Navy head-to-head on the open sea. Iran wouldn't be able to hold off the US 5th Fleet.

However, Iran can temporarily close the strait to commercial shipping for a few days.

One way Iran could disrupt shipping is through speedboats. Many Iranian speedboats are armed with anti-ship missiles or rockets in addition to machine guns.

The real danger isn't Iranian anti-ship missiles or rockets; it is the sea mines. Mines are easy and inexpensive to manufacture. Iran has developed a large number of mines of several types.

Just closing strait for a few days would cause significant delays, rerouting, soaring oil prices, and uncertainty for commercial shipping companies.

The Strait of Hormuz is at the Center of Global Tensions.

Iran wants to send a message to the United States that if it doesn't lift economic sanctions, it can exact revenge on US allies such as South Korea.

At the moment, President Trump is not willing to risk an all-out war in the Persian Gulf.

In the event of a war between Iran and the US, expect colossal damage to the region's infrastructure, energy, tourism, financial, tourism, shipping, and logistics sectors.

US-Iran relations appear to have reached an inflection point as President-elect Joe Biden prepares to take office.

A compliance-for-compliance agreement that sees the US lift sanctions on Iran for a reduction in Iran's nuclear activities is likely the way forward.

In the short term, the United States' main priority is to ensure the continuous free flow of oil and gas through the Strait of Hormuz.

© 2021 Meziechi Nwogu

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