So, after weeks of watching the global economy teeter on the edge of a cliff because one country decided to throw a tantrum and block a major waterway, the grown-ups finally tried to have a word. The UK Foreign Office, probably tired of the price of everything going up, patched together a virtual conference on Thursday with representatives from more than forty countries. Their demand to the Iranian regime was about as straightforward as it gets: open the Strait of Hormuz immediately and unconditionally, and while you’re at it, start respecting the basic bloody principles of freedom of navigation and international maritime law. Or we will cry you a river.
This little get-together was a direct result of the de facto blockade Iran slapped on the strait after the US-Israeli military operation kicked off on February 28. Let’s be clear about the scale of this mess. Under normal circumstances, about a fifth of the world’s oil – that’s roughly 15 million barrels every single day – flows through that narrow stretch of water. Now? Traffic has collapsed by a staggering 94 to 95 per cent. Forget the usual 140-odd ships passing daily; in March, you could count them on one hand, with fewer than five making the trip on average. The result is exactly what you’d expect from a bunch of out-of-touch mullahs playing pirate: global energy prices have shot up by around 40 per cent, and some analysts are now whispering about crude hitting $150 a barrel. The coalition of the weeping and the wailing – I mean, the international partners – called this for what it is: Iran trying to take the entire global economy hostage.
The meeting was hosted by Britain’s Foreign Secretary, Yvette Cooper, who had to state the obvious for the record: “Iran is trying to hold the global economy hostage in the Strait of Hormuz. They must not prevail”. In the official statement released after the tears were wiped away and the hand-wringing subsided, they outlined a few areas for “collective, coordinated action.” Translation: they talked a lot about what they might do. This includes cranking up the diplomatic pressure at the UN to send Iran a very clear message, considering coordinated economic sanctions if the strait stays shut, and working with the International Maritime Organization to try and free the thousands of terrified sailors trapped in the warzone.
Because, surprise surprise, this isn’t just about oil executives losing their bonuses. The human toll is already ugly. The IMO has confirmed 21 attacks on commercial ships since the war began, with ten seafarers killed and many more seriously injured. There are roughly 20,000 civilian sailors still stuck on vessels in the Persian Gulf, running low on supplies, exhausted, and under severe psychological strain. But sure, let’s argue about diplomacy while these people sit on floating powder kegs.
Meanwhile, the political posturing is reaching peak absurdity. The Gulf Cooperation Council, led by Bahrain, is trying to get the UN Security Council to authorise the use of force to blast the strait open. Their initial draft resolution, which included the classic “all necessary means” language, got watered down faster than cheap gin at a embassy party after Russia, China, and even France balked at the idea. The final version now only authorises “defensive means.” How very reassuring. China, ever the pragmatic voice of reason, pointed out the obvious: the “root cause” of this whole debacle is the illegal US-Israeli military operation in the first place. It’s a fair point, but it doesn’t exactly help the 20,000 stranded sailors or the developing nations now facing a food and energy catastrophe.
Adding insult to injury, Iran isn’t just blocking the strait; it’s trying to monetise the crisis. Reports have emerged of a new, semi-official “toll system” run by the Islamic Revolutionary Guard Corps. Apparently, to get through, you don’t just pay a fee – you have to submit your cargo and crew manifests for approval, get a secret code, and pay the extortion in either Chinese Yuan or cryptocurrency. For a fully-laden supertanker, that little “service charge” comes to about $2 million per trip. And if you don’t pay? Well, there’s always the risk of getting blown up by a drone, as a Kuwaiti tanker recently found out near Dubai.
So, to sum up the state of play: Iran has effectively shut down the world’s most important energy artery, global inflation is roaring back to life, twenty thousand sailors are trapped in a war zone, and the world’s response is a strongly worded letter and a resolution that allows for “defensive” action. What a spectacular coalition of tears and lamentations. The only people who seem to be acting with any clarity are the opportunists, like Russia, which is already circling Indonesia like a vulture, ready to sell them oil at a nice, inflated price.
