When an Iranian official this week laid out a list of demands to end the war started by the United States and Israel, he added an item that hadn’t been on Tehran’s list before: recognition of Iran’s sovereignty over the Strait of Hormuz.
The narrow waterway through which a fifth of the world’s oil and liquefied natural gas (LNG) ordinarily passes has emerged as the Islamic Republic’s most potent weapon.And it is now seeking to turn into both a source of potentially billions of dollars in annual revenue and a pressure point on the global economy.
Iran has long threatened to close the strait in case of an attack, but few expected it to follow through – or for it to prove so effective in disrupting global trade flows. The scale of the impact appears to have expanded Tehran’s ambitions, with the new demands suggesting it is seeking to turn that leverage into something more durable.
Shipping through the chokepoint has ground to a near halt amid Iranian attacks, sending global energy markets into turmoil and forcing countries far beyond the Persian Gulf to take emergency measures to secure fuel supplies.
“Iran has been a little taken aback by how successful its (Hormuz) strategy has been – by how cheap and how comparatively easy it is to hold the global economy hostage,” said Dina Esfandiary, Middle East lead at Bloomberg Economics. “One of the lessons learned in the war is that it has discovered this new leverage, and it’s likely to use it again in the future. And I think monetizing it is part of discovering that it has this leverage.”
Washington is acutely aware of that risk. US Secretary of State Marco Rubio warned Friday that one of the immediate challenges following the war would be Tehran’s attempts to establish a tolling system at Hormuz.
“Not only is this illegal, it’s unacceptable, it’s dangerous to the world, and it’s important that the world have a plan to confront it,” Rubio said after a G7 meeting in France. Foreign ministers from the group stressed “the absolute necessity” to restore “safe and toll-free freedom of navigation.”
In a nod to the growing strategic weight of the Strait of Hormuz, Mojtaba Khamenei used his first purported address as Iran’s new supreme leader to say that the leverage of blocking the waterway “must continue to be used.”