Singapore warns Iran's veto could threaten global shipping

Asian economies face the deepest economic risk from Strait of Hormuz disruptions, but Singapore's foreign minister warns the real strategic danger lies in Iran's potential veto power over global shipping lanes. The narrow waterway connecting the Persian Gulf and the Arabian Sea serves as a critical artery for regional energy supplies. Any prolonged closure would immediately strain markets across Asia.

U.S. President Donald Trump argued earlier this year that Asian nations should fund and manage the security of the route rather than relying on American naval forces. He told reporters, "We don't use the strait. We don't need it. Europe needs it. Korea, Japan, China, [and] a lot of other people." Singapore Foreign Minister Vivian Balakrishnan acknowledged the economic reality behind that assessment. He told CNBC on Wednesday at the Milken Institute's Asia Summit in Singapore that the United States is not completely wrong about Asia carrying the primary burden.

The conversation shifts quickly from economics to security. Balakrishnan noted that Tehran's push to charge vessels for passage goes far beyond generating revenue. Establishing a toll system would effectively grant Iran the authority to decide which ships enter or exit the waterway. That control would give Tehran greater leverage right now than even a potential nuclear weapon from an Iranian point of view.

For Singapore, unrestricted maritime access is non-negotiable. The city-state grounds its position in the United Nations Convention on the Law of the Sea, which guarantees transit passage and freedom of navigation through international straits. Balakrishnan emphasized that protecting these routes is not just a policy preference but a foundational legal requirement. "This, for us, is an existential question, and it's a matter of principle, matter of international law," he said.

Neither the United States nor Gulf states are likely to accept Iranian control over the waterway. Balakrishnan expects friction and diplomatic maneuvering through the next few months as regional powers navigate the standoff. He does not anticipate a quick diplomatic off-ramp to the conflict, suggesting that tensions will likely intensify before stabilizing.

The maritime chokepoint debate fits into a larger regional pattern. In April, Balakrishnan warned that a future U.S.-China clash in the Pacific could make current Hormuz tensions look minor by comparison. Singapore plans to refuse to choose between Washington and Beijing, instead prioritizing its own economic longevity. The nation will continue to defend freedom of navigation in the Strait of Malacca and will not join efforts to block or toll critical shipping routes.