Strait of Hormuz Explained: LNG Tanker Disha, the US-Iran Deal and India's Energy Security

The immediate trigger is the safe passage of the LNG carrier Disha through the Strait of Hormuz amid the winding down of the 2026 West Asia war. Disha is a Malta-flagged LNG vessel operated by a consortium led by the Shipping Corporation of India (SCI), the country's largest state-owned shipping company under the Ministry of Ports, Shipping and Waterways. It was chartered by Petronet LNG Limited, India's largest LNG importer, to bring in a cargo of 62,370 metric tonnes of LNG loaded at Qatar's Ras Laffan facility. After being stranded in the Persian Gulf for over three months, it crossed the strait and is headed to Petronet's Dahej terminal in Gujarat. The transit is significant because it is the first by an Indian-flagged-managed merchant ship in nearly two months and the first by any vessel since the announcement of a provisional US-Iran deal to reopen the waterway.

A chokepoint is a narrow, strategically critical passage along a heavily used sea route whose closure can disrupt global trade. The Strait of Hormuz lies between Iran to the north and Oman's Musandam Peninsula (and the UAE) to the south, and it connects the Persian Gulf with the Gulf of Oman and the Arabian Sea. It is the only sea route by which oil and gas from the Gulf producers can reach the open ocean. At its narrowest, the strait is about 33 km wide, with shipping lanes of only around 3 km in each direction, which makes it acutely vulnerable to military action and mining. Around a fifth of the world's total oil consumption and roughly a quarter of all seaborne oil trade pass through it, along with about a fifth of global LNG trade, the bulk of it Qatari. The overwhelming share of this energy is destined for Asia, with China, India, Japan and South Korea as the leading importers, which is why instability here has an outsized impact on the Indian economy.

The crisis began on 28 February 2026, when the United States and Israel launched airstrikes on Iran, killing its Supreme Leader and senior officials and striking military and energy infrastructure, including Qatar's Ras Laffan LNG complex. Iran retaliated with missile and drone strikes and closed the Strait of Hormuz to shipping, with the Islamic Revolutionary Guard Corps (IRGC) warning that no vessel could pass. This abruptly halted one of the world's busiest energy corridors, spiking oil prices and triggering fuel shortages across import-dependent Asia. The United States subsequently launched an aerial campaign to reopen the strait and, after talks faltered, a naval blockade of Iranian ports. A two-week ceasefire mediated by Pakistan was agreed in early April, but it frayed as Iran sought to control traffic and levy heavy transit tolls, and as both sides maintained competing blockades. A fresh memorandum of understanding announced in mid-June, intended to formally end the conflict, set the stage for Disha's transit.

India is the world's third-largest consumer and importer of crude oil and imports close to 88% of its crude requirement, leaving it structurally exposed to any disruption in supply. West Asia supplies a large share of this crude, and a substantial portion of India's oil imports physically transits the Strait of Hormuz. The dependence is even sharper for gas: India imports roughly half of its natural gas as LNG, with Qatar as its single largest supplier, and almost all Qatari LNG exits through Hormuz. India is also the world's second-largest importer of liquefied petroleum gas (LPG), the cooking-gas fuel, with the overwhelming majority sourced from the Gulf. The 2026 closure translated directly into a domestic squeeze, prompting the government to ration and prioritise household cooking gas over industrial use, demonstrating how a distant maritime conflict reaches Indian kitchens.

The governing framework is the United Nations Convention on the Law of the Sea (UNCLOS), 1982, to which India is a party (ratified in 1995). Part III of UNCLOS deals with straits used for international navigation. Under Article 37 and Article 38, such straits are subject to the regime of transit passage, under which all ships and aircraft enjoy the right of continuous and expeditious passage that the bordering states cannot suspend or impede; this is stronger than the regime of innocent passage (applicable in the territorial sea), which is restricted to surface ships and can be suspended for security. The legal dispute arises because Iran signed UNCLOS in 1982 but never ratified it, and argues that transit passage is not customary international law but a "package deal" binding only on parties, claiming instead that only non-suspendable innocent passage applies. The United States, too, is not a party to UNCLOS but treats transit passage as customary law. The mainstream legal view is that Iran's blanket closure of the strait violates the right of transit passage reflected in customary international law.

India's response combined naval, diplomatic and administrative tools. The Indian Navy provided escort and reassurance under Operation Sankalp, its standing Gulf maritime-security mission launched in June 2019 after tanker attacks in the Gulf of Oman, supplemented in 2026 by a dedicated energy-protection escort effort to shepherd India-bound tankers to safer waters in the northern Arabian Sea. The Ministry of External Affairs engaged Iran and Gulf partners at the highest level to secure safe passage and move stranded cargo. The Directorate General of Shipping ran a round-the-clock control room handling tens of thousands of calls and emails and coordinating the repatriation of Indian seafarers. A notable operational detail is that most vessels crossed by "going dark"—switching off their AIS transponders to avoid detection—whereas Disha transited with its AIS transponder on, signalling growing confidence that the corridor was reopening.

Physical alternatives to the strait are limited. Only Saudi Arabia (its East-West pipeline to the Red Sea, with capacity of around 7 million barrels per day) and the UAE (its pipeline to the Fujairah port on the Gulf of Oman) can route some crude around Hormuz, but their combined spare capacity cannot replace the volumes that normally transit the strait. For India, the strategically relevant overland and trade-route alternatives are the Chabahar Port in Iran—which lies on the Gulf of Oman, outside the Strait of Hormuz—and the linked International North-South Transport Corridor (INSTC) connecting India to Iran, Central Asia and Russia, as well as the proposed India-Middle East-Europe Economic Corridor (IMEC). However, these corridors mainly serve general trade and connectivity; they do not substitute for the crude and LNG that must still physically exit the Gulf through Hormuz. The realistic levers therefore lie in source diversification, strategic storage and demand-side energy transition rather than in any single bypass route.

Deepen source diversification: India has already widened its crude basket to around 40 countries, including large volumes from Russia and the United States; sustaining and expanding non-Gulf sources reduces single-corridor risk.

Build strategic reserves to global norms: India's strategic petroleum reserves cover only about 9.5 days, far below the International Energy Agency's recommended 90-day import cover; completing Phase-II caverns at Chandikhol and Padur and creating dedicated strategic LNG storage are priorities.

Strengthen maritime security architecture: continued naval presence under Operation Sankalp, armed security teams aboard merchant ships, and real-time tracking enhance the safety of Indian-flagged vessels and seafarers.

Develop alternative connectivity: operationalising Chabahar, the INSTC and IMEC builds resilient trade routes, even if they cannot fully replace Hormuz for energy.

Calibrated diplomacy: India must maintain balanced ties with Iran, Israel and the Gulf states, leveraging its large diaspora and energy partnerships to protect its interests during regional flashpoints.

Accelerate the energy transition: scaling up domestic exploration, renewables, green hydrogen, biofuels and the gas-grid network is the long-term structural hedge against import and chokepoint dependence.