Persian Gulf

Overview

The Persian Gulf is a regional sea in the Middle East, bordered by Iran on its northern shore and seven Arab states along its western and southern shores: Iraq, Kuwait, Saudi Arabia, Bahrain, Qatar, the United Arab Emirates and Oman. Its connection to the Gulf of Oman and the open ocean runs through the Strait of Hormuz. The sea links coastal ports, offshore oil facilities and international shipping routes. Its geography gives the states along its shores both access to maritime trade and a shared exposure to disruption at the strait.

The Persian Gulf has long been important to commerce, but oil exports made it central to the global economy. Roughly 20 percent of the world’s oil passes through the Strait of Hormuz. Tankers leaving the gulf must use that outlet, so interference with shipping can affect energy supplies far beyond the eight coastal countries. The gulf has also been the setting for the Iran–Iraq War at sea, the Gulf War, a sustained United States military presence and repeated confrontations involving the Iranian regime’s naval forces. China’s demand for oil has added another major economic interest in secure passage through the region.

Geography

The Persian Gulf narrows toward the Strait of Hormuz at its southeastern end. From there, ships enter the Gulf of Oman before reaching the open ocean. This single outlet concentrates traffic from oil terminals and commercial ports across the gulf. Major shipping routes pass close to Iran’s coastline, where vessels can face threats with little advance warning. Confined waters and heavy traffic also provide opportunities to conceal small vessels among ordinary maritime activity. These features make geography a central factor in both the gulf’s commercial value and its security.

At the northern end, the Tigris and Euphrates join before their waters reach the gulf through the Shatt al-Arab. That waterway connects the Persian Gulf with the Iranian ports of Khorramshahr and Abadan and the Iraqi port of Basra. Control and navigation of the Shatt al-Arab were longstanding sources of disagreement between Iran and Iraq. A treaty in 1847 addressed the boundary and freedom of navigation, while a 1975 agreement placed the boundary along the waterway’s midpoint. Neither arrangement removed the broader strategic importance of the river outlet and the nearby oil facilities.

Islands and coastal installations shape activity elsewhere in the gulf. Kharg Island, in its northern waters, serves as Iran’s main crude oil export terminal. Iran has deployed coastal defense cruise missiles along its gulf coastline and on Abu Musa, the Tunbs and the Farsi islands. Bandar Abbas, near the Strait of Hormuz, is close to the Persian Gulf Star gas condensate refinery, built and partially operated by the Islamic Revolutionary Guard Corps. The refinery processes 480,000 barrels of condensate daily, about 19 percent of Iran’s refinery feedstock. Along the southern shore, Dubai grew from a trading settlement on a creek into a major commercial center.

Jewish history

Jewish communities participated in the gulf’s commercial life, including in the Iranian port of Bushehr. After an Iranian naval base was established there in the eighteenth century, the port developed as a trading center. The English East India Company drew Jews from Bushehr’s surroundings and from Iraqi cities, including Basra and Baghdad, into its commercial networks. Jewish merchants were associated with the company and with Dutch trade in goods shipped to European markets. A Jewish traveler visiting around 1828 described a community of roughly 200 Jewish families and three synagogues in Bushehr, while also recording their poor treatment. His account offers a view of both Jewish participation in the port economy and the community’s circumstances at the time.

Israel’s later engagement with Persian Gulf states formed part of a wider diplomatic effort. After the 1994 peace treaty between Israel and Jordan, Shimon Peres pursued relations with Arab countries in North Africa and the Persian Gulf as part of his vision of a “New Middle East.” Relations between Israel and the United Arab Emirates changed markedly with their normalization agreement in 2020. The prospect of Israeli military, security and intelligence cooperation with the Emirates became a particular concern for the Iranian regime, whose officials threatened the Emirates over a potential Israeli presence in the gulf.

Modern history

During the reign of Mohammad Reza Pahlavi, Iran played a role in Persian Gulf security. The Iranian Revolution changed the regional setting. In 1981, Saudi Arabia, Kuwait, Qatar, Bahrain, Oman and the United Arab Emirates established the Gulf Cooperation Council amid fears of revolutionary Iran and spillover from the Iran–Iraq War. Iraq has a Persian Gulf coastline but is not a GCC member. The council gave the six Arab states a forum for cooperation while they faced war nearby and uncertainty about the intentions of the new Iranian regime.

The Iran–Iraq War placed ports, oil terminals and shipping in danger. Before the war, Iraq had developed a new port and offshore oil-loading terminals in the Persian Gulf, while Iran had expanded oil facilities on Kharg Island. During the 1980s, Iranian forces attacked shipping in the gulf. In the war’s final phase, they fought a series of naval battles against the United States Navy in April 1988 and suffered heavy losses. Those battles exposed the vulnerability of large vessels to air and missile attack and reinforced the Iranian regime’s interest in smaller, missile-armed craft. Revolutionary Guards naval forces had used massed small-boat tactics during the war, but the fighting also demonstrated their vulnerability to United States naval and air power.

On August 2, 1990, Saddam Hussein invaded Kuwait. President George H. W. Bush condemned Iraq’s aggression and identified longstanding United States interests in the Persian Gulf. The invasion brought American troops to Saudi Arabia and led to the Gulf War. The war and the end of the Cold War altered regional diplomacy, including the conditions under which Syria moved toward negotiations involving Israel. For Gulf states, the invasion showed that a neighboring army could threaten their sovereignty and that regional security required both local defense and the ability to bring outside forces to their aid.

United States forces remained in and near the Persian Gulf after the Gulf War. Their forward presence exceeded 200 aircraft, 20 ships and nearly 20,000 personnel afloat and ashore. These forces deterred Iran and Iraq and supported enforcement of sanctions on Baghdad. When an Iraqi military buildup near Kuwait raised renewed concern in 1994, the United States deployed nearly 30,000 service members to the gulf. Washington signed formal defense cooperation or access agreements with every GCC member except Saudi Arabia, where the arrangement was informal. Bahrain’s role became especially prominent as host of the United States Navy’s Fifth Fleet headquarters, while Abu Dhabi provided access to al-Dhafra Air Base for surveillance flights monitoring Iranian regime activity.

Gulf states also invested in their own defenses. In July 2007, President George W. Bush announced a regional arms initiative that included a proposed $20 billion weapons deal with Saudi Arabia. The same policy increased United States defense aid to Israel to $30 billion over ten years and renewed $13 billion in aid to Egypt. Saudi Arabia and the United Arab Emirates led Gulf states in ordering roughly $25 billion of military equipment, initially focused on air and missile defense. Abu Dhabi became the first customer outside the United States military to order the Terminal High Altitude Area Defense system. These purchases reflected concern about missile threats as well as the continuing importance of United States defense cooperation.

Security

The Iranian regime treats the Persian Gulf as a principal theater for a possible confrontation with the United States. Its naval planning centers on closing the Strait of Hormuz and attacking opposing forces inside the gulf. In 2007, Ali Khamenei assigned the Islamic Revolutionary Guard Corps Navy responsibility for the Persian Gulf and Strait of Hormuz, while assigning Iran’s regular navy waters outside the gulf. The Guards’ navy has conducted aggressive operations in the gulf and strait since the early 1980s. In 2008, the regime delegated more naval authority to lower-level commanders, increasing the risk that an encounter could escalate. Its practice of rewarding commanders who take operational risks adds to that danger.

Iranian naval capabilities are suited to threatening traffic in the gulf’s confined waters. They include limpet mines, coastal cruise missiles, speedboats, explosive boats and submarines. Shore-based anti-ship missiles can strike targets across much of the Persian Gulf and Gulf of Oman. Small, missile-armed boats can operate in groups and exploit short reaction times near shipping lanes; coastal inlets offer places from which to mount small-unit attacks. The 1988 battles helped drive the regime’s development of fast boats and coordinated swarming tactics. In July 2020, the Islamic Revolutionary Guard Corps Navy chief announced underground onshore and offshore missile facilities along Iran’s Gulf of Oman and Persian Gulf coasts. These capabilities threaten Gulf states, international commerce and oil exports passing through the strait.

Encounters at sea have shown how quickly operations can become dangerous. In January 2016, the Revolutionary Guards detained ten United States sailors after their two boats entered Iranian territorial waters following a navigation malfunction; the sailors were released after about 12 hours. United States military officials recorded monthly averages of 1.75 unsafe Iranian Revolutionary Guard Corps naval actions in 2015, three in 2016 and two during the first seven months of 2017. Recorded unsafe encounters fell to zero from mid-August 2017 during a change in the force’s conduct. Armed Iranian vessels again harassed United States naval ships in April 2020, prompting a United States warning about vessels approaching within 100 meters. The variation in encounters illustrates how commanders’ decisions affect risk in crowded waters.

Gulf governments have also faced threats beyond direct naval encounters. At a security conference in Doha, GCC Secretary-General Abdul Rahman al-Attiya identified the Iranian regime’s nuclear ambitions as a direct threat to Gulf states and NATO. Bahrain has faced Iranian regime subversion, sometimes involving its Lebanese proxy Hezbollah, a terrorist organization. The regime maintained substantial trade ties with the United Arab Emirates through Dubai while pursuing hostile activity against Emirati interests in the Persian Gulf. Its naval and aerial forces and proxy organizations have threatened shipping across the Gulf of Oman, Strait of Hormuz, Persian Gulf and Red Sea. Increased attacks by the Houthi movement, a terrorist organization, forced some tankers carrying crude from the Persian Gulf to Europe to sail around southern Africa.

The United Arab Emirates–Israel normalization agreement changed the Iranian regime’s assessment of Gulf security. Senior Iranian officials threatened the Emirates over Israel’s potential presence in the Persian Gulf. The regime feared that normalization would expand Israeli military, security and intelligence activity in the region and improve Emirati access to defensive technology, including missile defense. The agreement therefore had a security dimension alongside its diplomatic and commercial effects. It also placed the Emirates’ relations with Israel within a wider Gulf setting marked by Iranian missile capabilities, threats to shipping and continuing United States defense commitments.

Present day

The Persian Gulf remains a major source of oil for Iran and the Arab states along its shores and a vital supply region for China. In 1996, China imported $1.2 billion of oil from Persian Gulf countries, representing 34.6 percent of its crude imports. From 2010 through 2019, gulf countries supplied an average of 48 percent of China’s oil imports. By 2019, China imported $106.5 billion of oil from the region, or 43.9 percent of its crude imports. China’s dependence gives it a substantial interest in continued exports and safe passage through the Strait of Hormuz. It also ties Chinese economic interests to the security choices of several Gulf states, rather than to relations with Iran alone.

China’s largest Gulf trade relationships include United States partners. China–Saudi Arabia trade grew from $7.3 billion in 2003 to $63 billion in 2018. In the same year, China–United Arab Emirates trade reached $46.1 billion, compared with $24.5 billion in trade between the United States and the Emirates. United States sanctions drove Iranian crude sales to China down by more than half between the first quarters of 2019 and 2020. In the first quarter of 2020, Saudi Arabia supplied more than one-third of Persian Gulf oil sold to China, while Iraq supplied another fifth. These figures show the economic weight of Saudi Arabia, the Emirates and Iraq in China’s Gulf relationships.

Trade held up during the first quarter of 2020 despite the COVID-19 economic contraction. Persian Gulf countries bought $17.9 billion in Chinese goods and exported $37.1 billion in goods to China. Crude oil accounted for $27.9 billion of their exports to China, nearly half of China’s crude imports for that quarter. Both Chinese exports to and imports from gulf states rose. The scale of these exchanges links China’s energy supply and the gulf states’ export income to maritime access. A disruption at the Strait of Hormuz can therefore affect countries that do not border the Persian Gulf as well as those whose ports and oil terminals line its shores.

The consequences of interrupted passage became clear after the Iranian regime blocked the Strait of Hormuz: more than 2,000 ships remained trapped in the Persian Gulf, increasing the importance of transfer operations through the Gulf of Oman and efforts to address the blockade. On May 27, 2026, the United States sanctioned the Iranian-created Persian Gulf Strait Authority, a body linked to the Islamic Revolutionary Guard Corps that managed requests for passage through the strait. The episode underscored the gulf’s central geographic constraint. Its ports can serve a vast international trade, but ships entering or leaving them remain dependent on access through a narrow outlet subject to military pressure.