The Strait of Hormuz is both a vital passage point and a permanent point of tension. As long as the world depends on Oil from the Persian Gulf, its security will remain a major geostrategic concern. If Iran were to cross the red line, the consequences would not be limited to barrels of Oil, but the global economic balance could be shaken.

The Strait of Hormuz is considered the world's most important gateway for oil transport. Hostilities between Iran and Israel have raised fears that shipping and crude flows through the narrow waterway may now slow down.

About 21mn barrels of oil from Iran, Iraq, Kuwait, Saudi Arabia, Qatar and the United Arab Emirates pass daily through the narrow waterway separating the Islamic republic from the Gulf states, representing about one-third of the world’s seaborne oil supplies.

Amid escalating attacks between Iran and Israel, Iran threatens to withdraw from the Nuclear Non-Proliferation Treaty and potentially close the Strait of Hormuz, a critical global oil route.

Israel launched strikes against Iran on June 13, saying it targeted nuclear facilities, ballistic missile factories and military commanders during the start of a prolonged operation to prevent Tehran from building an atomic weapon.

Tensions at the Strait of Hormuz risk 20M bpd in crude oil flow, fueling a sharp rally in oil futures and boosting market volatility.

Share prices skidded in Europe and Asia on Tuesday after Israel’s military issued an evacuation warning to 330,000 people in Iran’s capital Tehran. U.S. futures also declined. Oil prices bounced after the warning for a part of the city of 9.