There are plenty of legitimate arguments as to why more sanctions on Iran should not be pushed- they will not work, they hurt ordinary people while strengthening the leaders etc.- but the argument that sanctions should not be pushed because Iran can retaliate by closing the Strait of Hormuz is not one of them. The Strait of Hormuz is a narrow passageway that connects the Persian Gulf to the Indian Ocean. Significance of this passage comes from the fact that it is the only sea passage in the Persian Gulf. As such, approximately 88 percent of all oil leaving the Persian Gulf goes via the Strait of Hormuz. Blocking the strait would create havoc on oil market and the world economy. But as Dr. Eugene Gholz argues in this Foreign Policy article, the Strait Dope, disrupting the oil flow in the strait is harder than it looks. In fact, Iran would find it extremely difficult, if not impossible, to close the strait.
For more information on the Strait of Hormuz, click here ( as a side note- I was part of the research team that helped create this website. Therefore, the strong interest in the strait).