Stagnant, passive and dangerous. This is how the Strait of Hormuz standoff is increasingly being described.
Now in its fourth month, the crisis off Iran’s coast is marked by a mutual blockade. Tehran is charging ships up to $2 million (€1.73 million) for safe passage through the strait while the United States imposes a naval blockade, turning back ships exporting Iranian oil.
These competing blockades have failed to produce decisive results. Some Iranian vessels continue to slip, while some Asian shipping companies have agreed to pay tolls despite such fees violating international maritime law.
Meanwhile, delicate talks between the US and Iran to reopen the Strait of Hormuz have stalled several times, threatening to escalate into a wider regional conflict.
Which side will turn first?
Yet, despite Pakistan-led mediation efforts and a proposed one-page memorandum aimed at ending hostilities and reopening Hormuz, neither side appears willing to blink at first.
Dania Thafar, executive director of the Gulf International Forum (GIF), a Washington-based think tank, believes Trump’s continued military threats – aimed at increasing his influence over Iran – may be counterproductive.
“The Iranian reaction suggests the opposite,” Thafar told DW. “They interpret it as America lacking the will to pursue the war.”
US President Donald Trump faces growing pressure both at home and abroad to avoid further military action, with Gulf allies such as Saudi Arabia, the United Arab Emirates and Qatar urging restraint. Rising oil prices and rising domestic inflation are raising political heat ahead of the US midterm elections in November.
Iran’s oil revenue is declining rapidly
Meanwhile, Iran is losing about $435 million a day in trade, about two-thirds of which comes mainly from crude oil exports, Miyan Maleki, senior fellow at the Foundation for Defense of Democracies (FDD), estimated in April.
This means that with the US blockade running for 39 days as of Friday, Iran’s public finances have already suffered an estimated $17 billion loss. According to Maleki, this is in addition to the approximately $144 billion in economic damage caused by US-Israeli attacks in the first weeks of the war.
Berku Ozcelik, senior research fellow at the London-based Royal United Services Institute (RUSI), believes Iran may have gained “immense benefits” through its missile attacks on shipping and Gulf neighbors but is now being “hit hard” by the disruption of its own oil exports.
“Despite Tehran’s claims about the regime’s resilience, its economy is not blockade-proof,” Ozcelik told DW.
Gulf countries caught in the crossfire
Experts describe the standoff as a dangerous waiting game. Both the US and Iran believe they have time. However, the Gulf countries are far more risk-averse and economically insecure.
Their frustration with the impasse has transformed into a coordinated push for diplomatic success. Gulf countries have urged Trump to postpone plans for further attacks and allow more time for negotiations.
Privately, he has warned that frozen conflict would jeopardize his plans to transition economies away from fossil fuels. Gulf countries are spending hundreds of billions of dollars on ambitious industrial and tourism projects.
They strongly support Pakistan-mediated talks and the joint US-UN initiative to reopen the strait without Iranian toll or control claims.
Iran seeks regional security hegemony
As a power that sees itself reshaping the Middle East region, Iran is also using the war for long-term gains. GIF’s Thafar believes Iran’s ambitions go far beyond war victory and seek to “sway the regional order in its favor” in the long term.
“They want the Gulf states to expel the United States and bring the region under the Iranian security framework,” he told DW. He said this approach is not in the interests of the Gulf countries, despite his disappointment with Washington.
While cautiously optimistic about a breakthrough in the talks, Washington insists on a full reopening of the strait, an end to all Iranian nuclear enrichment activities and no sanctions relief without major concessions. US Secretary of State Marco Rubio has warned that military action is an option if Iran does not reach a deal.
“The challenge is that there is no magical target that the US can strike that will immediately translate into the regime’s surrender,” Ozcelic told DW. “If civilian infrastructure is targeted, it could prompt Tehran to take harsh retaliatory measures against Gulf countries.”
Among Iranians, the pain has become worse
Tehran says it will stand firm, despite the growing difficulties faced by ordinary Iranians, which are unlikely to ease any time soon.
Ozcelik said, “Tehran’s various proposals to waive fees for crossing the Strait of Hormuz or to charge for undersea cables indicate a realization by some pragmatic voices in Tehran that the Iranian economy and its people will remain in difficulty for a long time, even if sanction relief is somehow agreed upon.”
Annual inflation in Iran has soared above 54%, with prices of some food products more than doubling. The nationwide internet blackout has lasted for more than 80 days, further isolating citizens and disrupting daily life.
“While Trump sees it [winning the war] As part of his presidential legacy, Iranians see this as a matter of regime survival and the future of their country,” Thafar underlined.
Edited by: Srinivas Majumdaru