Trump Administration Claims Iran Has Lost Control of Strait of Hormuz
An analyst's assessment suggests a new "Hormuz Shuttle" system, protected by the U.S. military, is circumventing Iranian threats and easing oil prices.
According to an analysis by Swiss energy analyst Alexander Stahel, Iran's regime has lost control of the Strait of Hormuz, a critical chokepoint for global oil shipments. Stahel's assessment, detailed in his investment letter The Commodity Compass, describes an operational system he terms the "Hormuz Shuttle," which he asserts is successfully moving substantial quantities of oil out of the Persian Gulf.
Stahel reports that the United Arab Emirates, followed by neighboring countries, established a robust system to transport oil via a new shipping channel along the Omani coast. This route is reportedly patrolled and protected by the United States military's Central Command. The strategy deviates from previous escort systems and has proven effective, according to Stahel, evidenced by declining oil prices in September and anticipated further decreases.
The "Hormuz Shuttle" began in May with the UAE deploying eleven very large crude carriers (VLCCs) owned by the Abu Dhabi National Oil Company (ADNOC) to ferry crude oil out of the Persian Gulf via the Oman Lane. These vessels then conduct ship-to-ship transfers before returning to the Gulf. Stahel notes that ADNOC has become proficient in this operation, with Saudi Aramco and Kuwait adopting similar models. Currently, approximately 116 vessels are engaged in this trade around the Strait of Hormuz, primarily utilizing the Oman Lane. Qatar and Iraq are also reportedly participating in the shuttle system.
Stahel concludes that Iran has failed to disrupt shipping through the Strait, and the "Hormuz Shuttle" system is scaling, diminishing Tehran's leverage. The analysis suggests that international oil prices, specifically West Texas crude and Brent crude, are expected to continue falling as markets recognize Iran's inability to impede the shuttle operations. This development is framed as a strategic success for President Trump, who has maintained a firm stance against Iran.
The article also touches upon the broader economic impact, referring to a "mullah tax" that has allegedly burdened the global economy since 1979. It posits that Iran's nuclear ambitions and missile programs have contributed to regional instability and global economic risk, with Israel bearing a significant burden due to its security concerns.
Following military operations against Iran earlier in the year, the "Hormuz Shuttle" and an American naval blockade are presented as having compelled Iran to seek negotiations. President Trump reportedly rejected these overtures, stating Iran had "overplayed its hand." Simultaneously, U.S. sanctions, described as having increased in severity, are seen as further pressuring Iran's economy.
The analysis suggests that Iran's leadership anticipated domestic political pressure on President Trump related to the midterm elections, which they believed would force him to negotiate. However, the article asserts that President Trump has maintained his strategy, prioritizing long-term historical impact over short-term electoral outcomes.