Hormuz Choked Again as US-Iran Truce Shatters, India Braces for Energy Shock

The Strait of Hormuz, a choke point for roughly a fifth of global oil and gas, is once again a flashpoint as the fragile ceasefire between the United States and Iran has completely disintegrated. Tehran's Islamic Revolutionary Guard Corps declared the crucial waterway closed on July 11-12, following a series of retaliatory strikes with Washington over recent attacks on commercial shipping. This aggressive move, quickly disputed by the US, immediately sends shockwaves through global energy markets and puts India, a major energy importer, on high alert for significant oil and liquefied petroleum gas (LPG) supply disruptions. This latest escalation marks the complete collapse of the Islamabad Memorandum of Understanding, a 60-day truce signed on June 17, which President Donald Trump declared 'over' on July 7. Since then, Iran has targeted commercial vessels, including the M/V GFS Galaxy, prompting the US Central Command to launch multiple waves of airstrikes against Iranian military targets across the Gulf, including critical oil infrastructure sites like Kharg Island, Bandar Abbas, and Qeshm Island. Iran, in turn, has struck US interests and allied nations from Bahrain to Oman, widening the conflict. Brent crude prices have surged past $79 a barrel amid the spiraling tensions, with some analysts recalling the earlier March 2026 surge where prices topped $114 per barrel. For India, the closure presents an immediate and severe challenge, particularly for its heavily import-dependent LPG sector, where 90% of supplies historically transit Hormuz. While New Delhi has diversified its crude oil sources and has reserves for several weeks, the prolonged disruption will inevitably lead to higher procurement costs and potential shortages, impacting household budgets and industrial users. The international community watches closely, as any sustained closure risks a global energy crisis, pushing nations like India to accelerate energy diversification and alternative shipping routes to mitigate future geopolitical risks.