Pakistan Says Deal Is Close Even as Iran, US Harden Stances

Summary

Noam Raydan, Senior Fellow at The Near East Institute, argues that Iran has established a lasting navigational order in the Strait of Hormuz and will not easily give up its wartime leverage. He expects the pre-war shipping lanes to remain unusable for a long time due to mines and Iranian obstruction, and sees workarounds like pipelines and ship-to-ship transfers as inadequate. The discussion implies sustained upward pressure on oil prices as normal crude flows through the key chokepoint are unlikely to resume soon.

• Iran has cemented control over Strait of Hormuz traffic and wants a dominant role in its future management
• Pre-war inbound/outbound shipping lanes are still mined and Iran will not make mine clearance easy
• Workarounds such as UAE ship-to-ship transfers and pipelines are limited and do not replace the strait
• Iraq heavily relies on the strait and has failed to build alternative pipelines due to security, financial and political obstacles
• Even if the war ends, a quick return to normal oil loadings through Hormuz is not expected
• The speaker implies oil markets face a prolonged risk premium from the strait disruption