The Middle East conflict between Iran and its Arab neighbours has been dominating global attention. Attention is focused primarily on the competing interests of Iran, the Gulf states and Western powers vying for position and influence. Yet from Singapore’s perspective, there is another crucial player and location in the saga unfolding: the strategically located Strait of Hormuz, through which a third of global energy supplies are consumed by Europe and Asia in their original form. Its security issues cannot be ignored for much longer.

With supply lines under pressure, Singapore faces two threats: a sharp rise in the cost of imported energy and industrial materials, threatening the economic recovery; and a stern test of the 1982 United Nations Convention on the Law of the Sea, specifically the rules for transit passage that Singapore respects scrupulously. To date, it has declined Iran’s offers to arrange safe passage for vessels carrying fuel, a decision consistent with its usual approach to the law of the sea.

Singapore is not geographically close to the Gulf, but Gulf instability matters to the city-state. A significant proportion of Singapore’s oil imports, and indeed its gas supplies, come from the Middle East. Almost all of these supplies transit through the Strait of Hormuz and its approaches. As a result, any disturbance, whether military or through-proxy, or even simple harassment of commercial vessels, that affects the Straits is likely to have very rapid and significant repercussions for the country’s refining and related petrochemical sectors, given its position as the world’s leading energy trading centre. The lack of strategic reserves and the absence of alternative supplies other than by sea expose the country to serious and embedded risk, for the economy as well as the security of its people.

It seems that the threat itself is escalating the exposure. Iran is selecting the moment to attack, and almost by definition chooses not to go to war. That means that its........

© Eurasia Review