The coming irrelevancy of the Strait of Hormuz

The coming irrelevancy of the Strait of Hormuz

Hanne Nabintu Herland

The geopolitical landscape of the Middle East is experiencing a historic transformation marked by the intentional erosion of the Strait of Hormuz's strategic significance. It also signifies an aggressive economic isolation of Iran and a shift away from British control of the international naval trade.

On Aug. 19, President Donald Trump announced on Truth Social"the most crushing economic operation ever taken against any country. This will be economic warfare and isolation on an unprecedented scale … any country that allows its financial institutions, businesses, airports, or government entities to provide any type of lifeline to Iran will itself face tremendous economic consequences. Oil smuggling, swap lines, cash transfers, exchange houses, ship registries, front companies – It all needs to stop now. You know who you are."

U.S. Treasury Secretary Scott Bessent and Energy Secretary Chris Wright recently pointed out that the Strait of Hormuz as a geopolitical choke point and vulnerable maritime route is rapidly diminishing.

"The strait is never going back to the way it was," Bessent said."What we are going to see over the next two years is that the strait is going to become irrelevant."

"The economic isolation that Bessent spoke of is the final phase of a strategy that he's been carrying out since March 2025," Susan Kokinda points out at Promethean Action. The economic sanctions target Iranian financial networks, including crypto wallets and international assets. This "isolate and strangle" strategy also aims to defund Iran's regional proxies without the need for direct military confrontation.

The campaign involves alternative oil production and transport routes and a renewed focus on nuclear energy to achieve energy independence. The Gulf states' expanding oil production beyond OPEC quotas, U.S. engagement in Venezuelan oil production, and new pipelines bypassing the strait together, signal a deliberate effort to decentralize and secure energy flows. It also enhances the sovereignty of Gulf producers. This regionalism contrasts sharply with past external impositions rooted in the Cold War era of a steady flow of Middle East conflicts, Kokinda highlights.

Iran has lost significant control over the Strait of Hormuz, writes CNN. Over 80% of liquids that have passed the strait over the past two weeks have done so via the Omani route, the remaining liquids have been "dark" transits, passing in the dark without transponders. In addition, over 6 million barrels are diverted via existing pipelines, and more are being built.Combined oil transits now total around 15 million barrels per day, before the war it was around 20 million barrels.