U.S. President Donald Trump in the White House on Tuesday. Mr. Trump is underestimating the determination of Iran’s IRGC to control the Strait of Hormuz, writes Rita Trichur.Mark Schiefelbein/The Associated Press
U.S. President Donald Trump’s pledge to secure the Strait of Hormuz has gone from dubious to delusional.
Iran is tightening its chokehold on the waterway – which connects the Persian Gulf to the Gulf of Oman – and is stepping up attacks on oil and gas tankers stuck in the region.
The strait has been effectively closed since Saturday because shipping insurers are increasing premiums and cancelling policies because of Iran’s drone and missile attacks. A U.S. tanker in the northern Persian Gulf and another vessel near Kuwait were among Tehran’s latest targets.
That these ship attacks continue unabated is just one of many reasons why Mr. Trump’s vow to secure the Strait of Hormuz should be met with incredulity.
How the closing of the Strait of Hormuz is affecting global oil markets
Mr. Trump is underestimating the determination of Iran’s Islamic Revolutionary Guard Corps, or IRGC, to control the strategic waterway that is used to transport 20 per cent of global shipments of oil and liquefied natural gas. There are mounting concerns that the U.S. is depleting its stockpile of weapons in this war.
The IRGC, a highly disciplined terrorist group, has been doubling down on defiance since Mr. Trump unveiled his ill-defined security plan for the strait in a social-media post.
“Effective IMMEDIATELY, I have ordered the United States Development Finance Corporation (DFC) to provide, at a very reasonable price, political risk insurance and guarantees for the Financial Security of ALL Maritime Trade, especially Energy, travelling through the Gulf,” Mr. Trump wrote on his Truth Social platform on Tuesday.
The full name of the agency is the U.S. International Development Finance Corp. As an investment arm of the U.S. government, it supports the country’s foreign policy and national-security goals through partnerships with the private sector.
“This will be available to all Shipping Lines. If necessary, the United States Navy will begin escorting tankers through the Strait of Hormuz, as soon as possible,” Mr. Trump added.
“No matter what, the United States will ensure the FREE FLOW of ENERGY to the WORLD. The United States’ ECONOMIC and MILITARY MIGHT is the GREATEST ON EARTH – More actions to come.”
Insurance brokers Marsh and Aon PLC are reportedly in discussions with Washington about how to insure oil and gas tankers, according to a Bloomberg report.
Let’s set aside the crass cash grab that this move implies.
Mr. Trump’s security promise for the Strait of Hormuz also lacks credibility because of his own record of reneged commitments, including a recent reversal on providing security guarantees for U.S. energy companies in Venezuela.
Tanker attack in the northern Persian Gulf boosts oil and gas prices, signals Iran war is widening
When Mr. Trump met with industry executives in January after the U.S. military captured Venezuelan president Nicolás Maduro, he promised “total safety, total security" to convince them to invest US$100-billion in the South American country’s energy infrastructure.
Predictably, the executives balked at Mr. Trump’s suggestion that U.S. oil companies could be “up and running” in the failed petrostate in less than 18 months.
Exxon Mobil Corp. chairman and chief executive Darren Woods, for one, said Venezuela is currently “uninvestable” – a perfectly reasonable comment that nonetheless sparked Mr. Trump’s ire.
What came next was a threat by Mr. Trump to keep Exxon Mobil out of Venezuela. Some two weeks later, U.S. Energy Secretary Chris Wright yanked the President’s offer entirely, saying that U.S. troops would not be used to provide security to oil companies.
Are we really to believe that Mr. Trump will provide U.S. naval protection to foreign vessels in the Strait of Hormuz after reneging on his offer to protect American energy companies in Venezuela?
There’s also the matter of the U.S. Navy’s continuing deployment in the Caribbean Sea and Eastern Pacific, including this week’s joint military action with Ecuador targeting narcoterrorists.
There is a risk that Mr. Trump is spreading the U.S. military too thin by waging a separate war against Iran. Thus, his security guarantees for the Strait of Hormuz are utterly implausible.
The intensity of the attacks, the killing of Iranian Supreme Leader Ayatollah Ali Khamenei, and the lack of any apparent exit plan indicated the conflict would not end anytime soon. It was already having far-reaching consequences: Safe havens in the Mideast like Dubai have seen incoming fire; hundreds of thousands of airline passengers are stranded around the globe; oil prices shot up; and U.S. allies pledged to help stop Iranian missiles and drones.
The Associated Press
Earlier this week, Helima Croft, head of global commodity strategy and Middle East and North Africa research for RBC Capital Markets, said Mr. Trump’s insurance proposal was “likely in a concepts-of-a-plan stage.” She also questioned whether there had been “sufficient co-ordination” with international tanker insurers.
“Though there is precedent for escorting tankers through the Strait, we think there may be fewer US naval assets to provide this service now than during the Iran/Iraq war given Washington’s active role in the current conflict,” Ms. Croft wrote in a research report on Tuesday.
Israel, meanwhile, has bluntly stated that it is prepared to assassinate Iran’s next leader, too, suggesting this conflict is far from over.
Mr. Trump’s haphazard war plan for Iran is risking an energy crisis. Oil prices are soaring because of snarled tanker traffic in Hormuz. It’s time for Republicans to call a spade a spade.