It doesn’t take much to block a shipping lane. One vessel blocked the Suez Canal for six days in 2021.
The Ever Given container ship wedged itself across the waterway during strong winds, halting tanker traffic for nearly a week.
The estimated cost to global trade was $50-$60 billion (€43-€52 billion).
Iran only needs one guy with a rocket launcher standing on the shore to make the Strait of Hormuz inoperable.
READ MORE
Tankers are large and slow, making them sitting ducks in a war zone.
And it’s not obvious that military escorts – which US president Donald Trump is trying and failing to get Nato allies to help with – is a solution.
Insurers are not going to cover vessels attempting to navigate war-torn regions.
According to the Financial Times, shipping groups, including MSC, Maersk, CMA CGM and Hapag-Lloyd, have informed customers they reserve the right to invoke a 19th-century rule that allows them to leave containers at the nearest available port at their client’s expense.
[ If real trouble hits the financial markets, here are two things to watchOpens in new window ]
“At the moment, it’s a complete wild west,” said David Ozard of removal group John Mason International.
With the skies controlled by Israel and the US, weaponising energy by blocking tanker traffic and attacking energy infrastructure in the region was Tehran’s only play: economic warfare to combat conventional warfare.
Iran has threatened to close the strait several times in the past, most recently in 2018 and 2019 in response to western sanctions on its oil exports and it’s inconceivable that this wasn’t gamed out in Washington in advance.
The effectiveness of this tactic, however, seems to have been underestimated.
Last year, Tehran’s response to US-Israeli attacks was largely performative and de-escalatory; now it has a more concerted strategy, targeting military bases, energy infrastructure and airports in the region to effectively paralyse it economically.
The difficult choices that could dramatically increase housing supply in Dublin
It is using its long coastline to launch short-range attacks, over water, which are harder to detect and intercept.
This might be designed to weaken western-supplied air defence systems before deploying more powerful cruise missiles.
Or has Iran’s ballistic capability already been destroyed by US-Israeli forces? That’s a key unknown.
The strategy is also financially corrosive on the US.
Iran’s Shahed drones cost $20,000-$30,000 to make, while the US F-16 jet missiles used to intercept them cost $400,000. US-made Patriot air-defence missiles cost up to $4 million each.
Either way, we’re down to a simple binary: either the strait is opened in the next two weeks, or the world faces an energy price shock on a par with the one triggered by Russia’s invasion of Ukraine in 2022.
Israel’s targeting of Iran’s South Pars gasfield, the largest natural gasfield in the world, seemingly done without US consent, and Iran’s retaliatory strike on Qatar’s Ras Laffan LNG complex mark a worrying escalation.
On the back of these attacks, European gas futures surged as much as 35 per cent to more than double their pre-war level while Brent crude rose as high as $119 a barrel.
[ Iran war: What can EU leaders do about rising energy prices?Opens in new window ]
Israel’s objectives have never quite coalesced with the US’s and it seems to be slowly enmeshing Washington in a more complex military encounter.
On the eve of US midterm elections, and with another price shock looming, Trump finds himself in a classic escalatory trap. Either he raises the stakes or backs down. And the cracks are already appearing.
The US National Counterterrorism Center director Joe Kent, a US army veteran and a strong proponent of Trump’s America First doctrine, resigned on Tuesday, alleging Washington had been dragged into a war by Israel on false pretences.
“I cannot in good conscience support the ongoing war in Iran. Iran posed no imminent threat to our nation, and it is clear that we started this war due to pressure from Israel and its powerful American lobby,” he wrote in a letter to Trump posted to social media.
He alleged that “high-ranking Israeli officials” and influential US journalists had sown “misinformation” that led the president to undermine his “America First” platform.
US national intelligence director Tulsi Gabbard, who defected from the Democrats to the Republicans in protest at the US’s involvement in so-called “forever wars”, also seemed to contradict one of Trump’s justifications for the attacks, suggesting Iran had not been rebuilding its nuclear enrichment capabilities following US and Israeli attacks last year.
Iran’s Islamic republic regime only has to stay standing to claim victory. It knows that it probably has the “strategic patience” to outlast Trump, but Israel will try to keep the US in the fight for as long as possible.
The conflict is no longer just a US-Israeli air campaign against Iran; it is now a broader regional war involving Lebanon, the Gulf states, shipping and energy markets.
The issue is no longer whether Israel and the US have inflicted damage on Iran – they patently have – but whether Trump can turn this military dominance into a political outcome or whether we’re headed further down the road of unintended consequences.
