Strait of Hormuz Data Flows Hit 20% of Global Total, Rivaling Oil
0h ago|4 min readStandard
Fazen Markets Editorial Desk
Collective editorial team · methodology
strait-of-hormuzsubmarine-cables
Fazen Markets Editorial Desk
Collective editorial team · methodology
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Undersea cable consortiums reported on 30 May 2026 that the Strait of Hormuz now carries approximately 20% of global internet data traffic. This figure places the volume of data transiting the maritime chokepoint on par with its more famous role in transporting 21 million barrels of oil per day. The data flow represents a strategic concentration of digital infrastructure in a persistently volatile region, elevating risks for global communications and financial markets. The strait is a critical node for data exchange between Europe, the Middle East, and Asia.
The strategic importance of the Strait of Hormuz has historically been defined by energy security. Approximately one-fifth of the world's oil supply passes through the narrow waterway, making it a focal point of geopolitical tension for decades. The 2019 attacks on oil tankers and the recurring threats of strait closures by regional actors have consistently caused oil price volatility and risk premium spikes.
The current macro backdrop features heightened Middle East tensions, with Brent crude trading near $84 per barrel. Global supply chain resilience remains a primary concern for investors following recent disruptions. The accelerated digitalization of Gulf economies, particularly in Saudi Arabia and the UAE, has driven massive investments in regional data centers and connectivity.
The catalyst for recognizing the data flow milestone is the recent activation of multiple new high-capacity submarine cables. Systems like the Africa-1 and Blue-Raman cables have chosen routes through the Strait of Hormuz to create the lowest-latency paths between key financial hubs. This infrastructure build-out has concentrated a critical mass of global data capacity in a single, high-risk geographic pinch point.
The 20% data flow figure quantifies the bandwidth of submarine cables crossing the strait. This traffic includes financial transactions, cloud computing data, and internet communications linking major economic zones. The following table compares the strait's role in data versus commodity flows.
| Flow Type | Daily Volume | Share of Global Total | Primary Risk |
|---|---|---|---|
| Crude Oil | ~21 million barrels | ~21% | Supply Disruption |
| Internet Data | ~20% of global packets | ~20% | Latency & Blackout |
Internet exchange points in Fujairah and Muscat have seen data throughput increase by over 300% since 2022. The strait now hosts more submarine cable landings than the Suez Canal. A single cable cut in the region in 2025 caused a 40% latency increase for internet traffic between India and Europe, highlighting the fragility of this concentrated infrastructure. The data concentration rivals the 17% of global LNG shipments that also transit the waterway.
The concentration of data flows creates tangible second-order effects for specific market sectors. Major technology and cloud providers with substantial infrastructure in the region, such as Microsoft (MSFT) and Amazon (AMZN) through AWS, face direct operational risk. Their equity valuations now carry an implicit geopolitical risk premium tied to the strait's stability. Conversely, telecommunications giants like AT&T (T) and Verizon (VZ), which partner on these cable systems, benefit from increased bandwidth demand but share the infrastructure vulnerability.
Specialized infrastructure firms involved in cable laying and maintenance, such as Subsea Cloud, could see increased demand for their services. The market impact of a major cable disruption would be immediate, potentially causing significant losses for high-frequency trading firms and platforms reliant on low-latency connections between continents. Acknowledging a counter-argument, some network engineers suggest internet protocols are strong enough to reroute traffic, though not without severe latency penalties that would disrupt time-sensitive financial operations.
Trading flow data indicates increased options activity on tech stocks with significant Middle East exposure. Hedge funds are building long positions in cybersecurity and satellite communication stocks as a hedge against terrestrial cable vulnerability. The market is beginning to price digital infrastructure risk with a model similar to energy security risk.
Market participants should monitor two specific near-term catalysts. The International Cable Protection Committee meeting on 15 June 2026 may publish new risk assessments and routing recommendations for the region. Secondly, earnings calls for major cloud providers in late July will be scrutinized for mentions of increased capital expenditure on redundant network paths outside the strait.
Key levels to watch include latency metrics on major internet routes between London and Mumbai. A sustained increase of over 50 milliseconds would signal emerging congestion or risk. The share price of cloud computing stocks breaking below their 200-day moving average could indicate a repricing of geopolitical risk. The activation of the new Trans-Arabian cable system in Q4 2026, which bypasses the strait, will test the market's appetite for alternative routing.
The Strait of Hormuz now carries a larger share of global data traffic than the Suez Canal, which handles an estimated 10-15% of internet flows. The Hormuz route is preferred for new cables because it offers a more direct path between data centers in Southern Europe and growing digital economies in India and Southeast Asia. This geographic advantage comes with significantly higher political risk profiles for the infrastructure owners.
A physical blockage would not sever global internet connectivity but would cause severe congestion and latency spikes for data traveling between Europe and Asia. Traffic would reroute through longer paths like the Mediterranean-Egypt-Red Sea corridor or transpacific cables, increasing latency by 50-100 milliseconds. This delay would disrupt high-frequency trading, live video conferencing, and real-time cloud services, creating an economic impact beyond simple communication issues. The financial sector would experience the most immediate operational disruption.
Several projects aim to create redundancy. The Trans-Arabian cable through Saudi Arabia and Jordan offers a land-based bypass. Satellite internet constellations from Starlink and OneWeb provide an alternative, though currently limited, bandwidth. The most ambitious project is the Arctic Fibre cable, which routes data over the top of the world, but its high cost and technical challenges have delayed widespread adoption. These alternatives are currently more expensive than the strait route.
The Strait of Hormuz has become as critical to global data flows as it is to oil, concentrating digital infrastructure risk in a single geopolitical flashpoint.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.
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