For nearly six months, the United States and Israel have been locked in a regional conflict with Iran. The negative economic impact on the global economy has been significant, as traffic through the Strait of Hormuz remains far below prewar levels. This drop comes despite President Donald Trump’s assurance that the U.S. Navy controls the chokepoint and a statement by Energy Secretary Chris Wright that the Navy has been escorting ships through the strait, with a recent weekly average volume of 8 million barrels of oil per day — still much lower than the prewar average of 20 million barrels per day. Serving as a transit corridor for upwards of 20% of global energy trade, the Strait of Hormuz has become a core part of Iran’s power projection strategy. Even if the U.S., Israel, and the allied Gulf nations reach a deal with Iran, it is unlikely that the Islamic Revolutionary Guard Corps will allow transit through the Strait of Hormuz to ever return to prewar normality.
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