Politics
What are the stakes in Strait of Hormuz if Iran-Israel conflict worsens? TenX News
Tensions are flaring up in the Middle East and there are already knock-on effects impacting economies globally, including with higher prices for gasoline at the pumps.
According to a Reuters report on Wednesday, former Iranian economy minister Ehsan Khandouzi has said that tankers and LNG cargoes should only transit the Strait of Hormuz with Iranian permission and this policy should be carried out from “tomorrow [Wednesday] for a hundred days.”
While it’s not clear if Khandouzi was speaking personally or if his views are shared by the regime in Tehran, the stakes of any changes to passage through the Strait of Hormuz would be significant, experts say.
“It is an enormous, probably the biggest and most important maritime choke point in the world for the global economy,” says Joe Calnan, vice-president of energy and a fellow at the Canadian Global Affairs Institute.
“This is the single choke point that is most likely to upend the international economy, and there’s not very many alternative routes.”
Speaking at the G7 summit in Alberta, leaders said in a joint statement that they are watching the conflict closely.
“We urge that the resolution of the Iranian crisis leads to a broader de-escalation of hostilities in the Middle East, including a ceasefire in Gaza,” the statement said.
“We will remain vigilant to the implications for international energy markets and stand ready to coordinate, including with like-minded partners, to safeguard market stability.”
What is the Strait of Hormuz?
The Strait of Hormuz is about 30 km wide at its narrowest point and acts as a channel between the Persian Gulf and the Gulf of Oman.
Persian Gulf region showing the Strait of Hormuz, a vital shipping route, and narrow choke point on the way to the Gulf of Oman and Arabian Sea.
Although Oman, to the south, technically controls the waterway, Iran’s location immediately to the north means vessels could be at risk of attacks or blockades.
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Among the many shipping vessels that pass through the strait every day carrying a wide range of goods, the majority contain crude oil, liquified natural gas, propane and many others energy products critical to economies worldwide.
According to the U.S. Energy Information Administration, which is the statistics branch of the U.S. Department of Energy, 20 million barrels of oil per day passed through the strait, or roughly 20 per cent of global consumption, in 2024.
“The inability of oil to transit a major chokepoint, even temporarily, can create substantial supply delays and raise shipping costs, potentially increasing world energy prices,” the U.S. Energy Information Administration says.
“Although most chokepoints can be circumvented by using other routes—often adding significantly to transit time—some chokepoints have no practical alternatives. Most volumes that transit the strait have no alternative means of exiting the region, although there are some pipeline alternatives that can avoid the Strait of Hormuz.”
Takeshi Hashimoto, CEO of Japan’s second-largest shipping company MOL, was quoted by Reuters while speaking on the sidelines of the Energy Asia conference and describing the strait’s importance.
“There is no alternative route for shipments in the (Persian) Gulf — there is no other choice,” he said.
These tensions in the region are rooted in a combination of relatively recent conflicts, including Israel’s fight with Hamas in Gaza, which Iran has been involved in by arming Hamas with military resources and intelligence, while also backing Hezbollah, Houthis and other militant groups.
Iran has also opposed terms of a nuclear deal with the United States.
More recently, Israel launched strikes on Iran’s nuclear and military facilities, which led Iran to launch counterattacks. The two sides have been engaging in military strikes for almost a week since, eventually drawing the more focused watch of the United States.
If Iran were to target the Strait of Hormuz, it would rapidly escalate the situation.
“It’s a difficult option for Iran to employ as it would almost certainly introduce the U.S. and others into the conflict,” says senior geopolitical adviser Arif Lalani at StrategyCorp in an email to Global News.
Lalani was formerly the Canadian ambassador to Jordan, Iraq, Afghanistan and the United Arab Emirates and was also director general of strategic policy at what is now Global Affairs Canada.
What happens if the Strait of Hormuz is shut down?
Most of the oil coming from the Persian Gulf is bound for China, Korea, Japan, and India, with smaller volumes going to the U.S. as well, the U.S. Energy Information Administration data says.
But instability affects global oil markets, and not just individual countries.
According to the International Energy Agency, over a fifth of the world’s oil passes through the Strait of Hormuz daily, and a shutdown would mean a big spike for the price of oil beyond recent increases.
In most cases, when the price of oil goes up, so too does the price of transportation, including gasoline for cars, planes, trains, boats and more.
“If we’re talking about anywhere between five to 10 million barrels of oil per day being taken off the market, that could have huge impacts globally, and not something that’s constrained just to the Middle East,” says Calnan.
“Energy is hugely reliant on oil for transportation, for heating, for electricity, for petrochemicals, and all sorts of things — oil is really important, and this is a major supply of it.”
Gas prices in Canada, among other countries, could spike sharply if shipments reroute away from the Strait of Hormuz for fear of attacks by Iran or its proxies. The oil that Canada consumes comes largely from domestic sources, but also international, including the Middle East.
A situation where the Strait of Hormuz sees fewer, or no shipments of exports like oil not only would be bad for Canadians filling up their gas tanks, but also have wider ripple effects across the economy.
This also could mean a potential lost opportunity for Canadian oil exporters as shutdown of the strait would mean higher international demand for oil.
“If Canada had built the pipelines and ports off our West Coast, Canada could be supplying key allies and the threat of disrupting the Strait of Hormuz would be much less — Canada and the West would be stronger” says Lalani.
“Instead, Canada’s resources are marooned on the North American continent.”
Although experts feel it is unlikely that the Strait of Hormuz will be used for leverage at this stage of the conflict, it’s important to understand the risks as Iran feels further pressure.
“They (Iran) would be kind of attacking the energy security of their own customers, and not Israel or the United States by shutting down the Strait of Hormuz. It’s more of an existential threat to the global economy that Iran would be trying to use this as leverage,” says Calnan.
“I still think it’s extremely unlikely that they choose to do this, but it’s currently looking like the Iranian regime might be in a situation of truly existential threat, and that can create some pretty extreme options being on the table.”
World leaders are raising alarm after U.S. President Donald Trump threatened to impose sweeping tariffs on European allies in an effort to pressure Denmark into negotiations over Greenland.
The move is sparking protests across the Arctic and sharp rebukes from Europe and Canada.
On Saturday, thousands of people marched through snow and ice in Greenland’s capital, Nuuk, chanting “Greenland is not for sale,” waving national flags.
Police described the demonstration as the largest they have ever seen in the city.
About 825 kilometres away, dozens of people rallied in Iqaluit, Nunavut, in a show of solidarity with Greenlanders.
“Greenland is owned by the Greenlandic people,” protesters chanted in Inuktut as they marched for an hour in freezing, windy conditions.
The protests came as Trump announced he would impose a 10 per cent import tax starting next month on goods from eight European countries.
These nations include Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland, because of their opposition to U.S. control of Greenland.
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The tariff would rise to 25 per cent on June 1 if no deal was reached for what Trump called the “Complete and Total purchase of Greenland.”
The president suggested the tariffs were leveraged to force talks over Greenland, a semi-autonomous territory of NATO ally Denmark that Trump says is vital to U.S. national security.
French President Emmanuel Macron said France stands firmly behind Greenland’s sovereignty and rejected the use of trade threats.
“Tariff threats are unacceptable and have no place in this context,” Macron wrote on social media, adding that Europeans would respond “in a united and coordinated manner” if the measures are confirmed.
British Prime Minister Keir Starmer said Greenland’s future is for Greenlanders and Denmark to decide.
“Applying tariffs on allies for pursuing the collective security of NATO allies is completely wrong,” Starmer said, adding the issue would be raised directly with the U.S. administration.
Bob Rae, former Canadian ambassador to the United Nations, also chimed in on Trump’s announcement.
The tariff threat could mark a significant rupture between the U.S. and its NATO allies.
Greenland already hosts the U.S.-run Pituffik Space Base under a 1951 defence agreement with Denmark, supporting missile warning, missile defence and space surveillance for the U.S. and NATO.
“There is no sign of the Trump war of aggression against Greenland and Denmark letting up. It is not about ‘security’ any more than Venezuela was about ‘narco-terrorism.’ They are both about seizing control and plunder.”
He further added, “No country, including my own, Canada, is safe or secure.”
The tariff threat could mark a significant rupture between the U.S. and its NATO allies.
Trump is expected to face questions about the proposed tariffs and Greenland later this week.
He is scheduled to attend the World Economic Forum in Davos, alongside several European leaders he has threatened with tariffs.
— With files from The Canadian Press
© 2026 Global News, a division of Corus Entertainment Inc.
Prime Minister Mark Carney arrived in Doha on Saturday as part of a push to attract foreign investment and deepen Canada’s economic partnerships beyond its traditional allies.
Carney’s visit comes on the heels of his visit to China and follows the recent presentation of a new federal investment budget aimed at positioning Canada as a stable, attractive destination for global capital.
In a news conference on Saturday, Finance Minister François-Philippe Champagne said Canada is working to broaden its economic relationships as global trade patterns shift.
Qatar is viewed by Ottawa as a strategic partner, with officials pointing to the country’s significant investment capacity and growing influence on the global stage.
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“We need to reduce our dependence and increase our self-reliance to find a strategic path forward,” Champagne said.
“Engaging with the Middle East and China is necessary for Canada, just like our European partners have done,” Champagne added. “We buy more from the U.S.A. than anywhere else, but the trading climate right now is different.”
The conference highlighted Canada’s industrial capacity and trade advantages as key selling points for potential investors.
Champagne also said international engagement is critical as Canada works to raise its profile among global investors.
“We are one of the G7s with very big industries. We build cars, planes, ships, we have an abundance of energy, and we are the only one with free trade with all G7,” Champagne said. “With the way the world is changing, you better diversify, supply chain is changing and we need to adapt.”
Prime Minister Carney is expected to meet with senior Qatari officials, including Emir Sheikh Tamim bin Hamad Al Thani, as well as representatives of the Qatar Investment Authority.
His office says the talks will focus on expanding trade access and forging partnerships in artificial intelligence, infrastructure, energy and defence.
The visit comes amid heightened geopolitical tensions in the region, though officials say the schedule remains unchanged.
© 2026 Global News, a division of Corus Entertainment Inc.
The possibility of a forceful U.S. takeover of Greenland is raising many unprecedented questions — including how Canada, the European Union and NATO could respond or even retaliate against an ostensible ally.
A high-level meeting between Greenlandic, Danish and U.S. officials this week did not resolve the “fundamental disagreement” over the territory’s sovereignty but did set the stage for more talks. The White House made clear Thursday that U.S. President Donald Trump’s desire to control Greenland has not changed after the meeting.
“He wants the United States to acquire Greenland. He thinks it’s in our best national security to do that,” White House press secretary Karoline Leavitt said.
Denmark and European allies are sending more troops to the territory in a show of force and to display a commitment to Arctic security.
Experts say there are other, non-military measures available in the event of a U.S. annexation or invasion of Greenland, or which could at least be threatened to try and get Trump to back down.
Whether those economic measures are actually used is another matter, those experts say.
“I think it remains highly unlikely that we’ll get to that point where we have to seriously discuss consequences for a U.S. move on Greenland,” said Otto Svendsen, an associate fellow with the Europe, Russia, and Eurasia Program at the Center for Strategic and International Studies.
“So it remains contingency planning for a highly unlikely event. That being said … Denmark would certainly do everything in its power to rally a very robust European response.”
Here’s what that could entail.
EU trade, tech disruptions?
Experts agree the biggest pressure points that can be used in the U.S. surround trade and technology.
The European Parliament’s trade committee is currently debating whether to postpone implementing the trade deal signed between Trump and the EU last summer to protest the threats against Greenland, Reuters reported Wednesday.
Many lawmakers have complained that the deal is lopsided, with the EU required to cut most import duties while the U.S. sticks to a broad 15 per cent tariff for European goods.
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An even bolder move would be triggering the EU’s anti-coercion instrument — known as the “trade bazooka” — that would allow the bloc to hit non-member nations with tariffs, trade restrictions, foreign investment bans, and other penalties if that country is found to be using coercive economic measures.
Although the regulation defines coercion as “measures affecting trade and investment,” Svendsen said it could feasibly be used in a diplomatic or territorial dispute as well.
“EU lawyers have proven themselves to be very creative in recent years,” he said.
However, David Perry, president of the Canadian Global Affairs Institute, said in an email that economic measures against the U.S. are unlikely “given the massive asymmetry in the defence and economic relationship between the U.S.” and other western nations.
“Any kind of sanction against the U.S. doesn’t make sense for the same reason they can impose tariffs on others: they have the power,” Perry added.
Target U.S. tech companies?
The likeliest — and potentially least harmful — scenario for retaliation in the event of an attack on Greenland, Svendsen said, would be fines or bans against U.S. tech companies like Google, Meta and X operating in Europe.
That’s because the Trump administration has taken particular focus on preventing what they call “attacks” on American companies by foreign governments seeking to regulate their online content or tax their revenues, which has led to calls on Canada, Britain and the EU to repeal laws like digital services taxes.
“I think that would be a really smart and targeted way to get to economic interests very close to the president, while minimizing the direct impact on the on the European economy,” Svendsen said, calling such a move “low-hanging fruit.”
He also compared a future U.S. tech platform ban to how Europe moved to wean itself off Russian gas after the full-scale invasion of Ukraine in 2022.
“If you told anyone back then that Europe would basically rid itself of its dependence on Russian gas basically within a two-year period … that would have been considered completely impossible,” he said.
“Weaning the European economy off of U.S. tech would certainly be painful in the short term, but they’ve proven that they can get off those dependencies quickly if there is political will behind it in the past.”
A U.S. hostile takeover of Greenland would mean the “end” of the NATO alliance, experts and European leaders have said.
Trump himself has acknowledged it could be a “choice” between preserving the alliance or acquiring Greenland.
There is no provision within the NATO founding treaty that addresses the possibility of a NATO member taking territory from another, and how the alliance should respond to such an act.
A NATO spokesperson told Global News it wouldn’t “speculate on hypothetical scenarios” when asked how it could potentially act.
“None of this would be actionable in a NATO sense,” Perry said. “It’s an alliance that’s organized to bind the U.S. to European security, and revolves around the U.S. So there’s no scenario of NATO doing that to the U.S.”
Denmark and other European nations could move to reduce or close U.S. military bases in their countries as a possible response, experts say.
Balkan Devlen, a a senior fellow at the Macdonald-Laurier Institute and director of its Transatlantic Program, said in an interview that a U.S. annexation of Greenland would force Canada to focus entirely on boosting its defences in the Arctic.
That may include trying to decouple from NORAD, the joint northern defence network with the U.S., in favour of a purely domestic Arctic command, he said — although that process would take years and require Canada to increase defence spending even further.
“Never mind five per cent (of GDP) — we will probably need to go like seven, eight, nine per cent on defence spending to be able to do anything of that sort,” he said. “It’s not even clear that we’ll be able to have enough people to do that.”
Devlen added that any retaliatory action, whether military or financial, needs to be targeted and proportionate to what the U.S. does.
“The problem with nuclear options is that once you use it, it’s gone,” he said. “And if it doesn’t do the damage or make the change of behaviour on the other party, you’ve basically lost a lot of leverage and you might actually sustain a lot more loss yourself.”
“Unacceptable’: Allies react to Trump Greenland tariff threats – National TenX News
Canada talks trade with Qatar as Carney touches down in Doha – National TenX News
How could Canada, EU, NATO respond to a U.S. takeover of Greenland? – National TenX News
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