U.S. President Donald Trump will restore his "maximum pressure" campaign on Iran and drive its oil exports down to zero, a U.S. official said on Tuesday.

Iran has repeatedly threatened to close the Strait of Hormuz for traffic as a retaliation for Western pressure. That would shut down the region's trade and lead to a spike in oil prices.

The Streit of Hormuz & Oil

The strait lies between Oman and Iran and links the Gulf north of it with the Gulf of Oman to the south and the Arabian Sea beyond.

It is 21 miles (33 km) wide at its narrowest point, with the shipping lane just two miles (three km) wide in either direction.

About a fifth of the world's total oil consumption passes through the Strait or some 18-19 million barrels per day (bpd) of oil, condensate and fuel.
OPEC members Saudi Arabia, Iran, the UAE, Kuwait and Iraq export most of their crude via the Strait, mainly to Asia.

The United Arab Emirates and Saudi Arabia have sought to find other routes to bypass the Strait. The U.S. government says that 2.6 million bpd of unused capacity from existing UAE and Saudi pipelines could be available to bypass Hormuz.

Qatar, the world's biggest liquefied natural gas (LNG) exporter, sends almost all of its LNG through the Strait, accounting for around a quarter of global LNG use. Iran has threatened over the years to block the strait but never followed through. The U.S. Fifth Fleet, based in Bahrain, is tasked with protecting commercial shipping in the area.

A Timeline of Tension

• In 1973, Arab producers led by Saudi Arabia slapped an oil embargo on Western supporters of Israel in its war with Egypt. While Western countries were the main buyers of crude produced by the Arab countries at the time, nowadays Asia is the main buyer of OPEC's crude. The United States more than doubled its oil liquids production in the last two decades and has turned from the world's biggest oil importer into one of the top exporters.
  
  
• During the 1980-1988 Iran-Iraq war, the two sides sought to disrupt each other's exports in what was called the Tanker War.
  
  
• In July 1988, a U.S. warship shot down an Iranian airliner, killing all 290 aboard, in what Washington said was an accident and Tehran said was a deliberate attack.
  
  
• In January 2012, Iran threatened to block the Strait in retaliation for U.S. and European sanctions. In May 2019, four vessels - including two Saudi oil tankers - were attacked off the UAE coast, outside the Strait of Hormuz.
  
  
  (Reuters)