The new age of chokepoints

IRAN’S recent partial closure of the Strait of Hormuz has once again exposed how vulnerable global commerce remains to disruption at a handful of narrow passages.

Roughly a fifth of the world’s oil and a significant share of maritime trade pass through Hormuz alone. When tensions constrict such arteries, energy prices, freight rates, insurance premiums and corporate balance sheets react almost immediately.

Hormuz is not an anomaly. The global economy runs on a small number of critical passages, including the Suez Canal, Panama Canal and Strait of Malacca, that together carry more than half of global maritime trade.