Iran has allowed certain ships through the Strait of Hormuz, including from India and Pakistan, as the ships are guided via a route close to Iran’s shore. It is also reported that Iran means to use its control over the Strait to preferentially support those who do not support the assault upon them. It is reported further that they may target a Western vulnerability, the dollar.
CNN, reported on March 15: “Tehran is in discussions with eight countries outside the Middle East to grant safe passage through the Strait of Hormuz to tankers carrying oil traded in Chinese yuan.” Indeed, the increasing weaponization of the dollar, given its use as the reserve currency, has given second thoughts to many countries about ending such dependence. So, Iran may well be targeting such a vulnerability. Iran, a new member of the BRICS, has advocated for a new currency for international trade. However, the same CNN source also indicated that traffic through the Strait may be managed upon other considerations as well.
South Korea’s The Chosun quoted Harrison Prett, Deputy Director of the Asia Maritime Transparency Initiative at the Center for Strategic and International Studies (CSIS), to say: “This route usage seems linked to Iran’s approval of specific ships’ passage through the strait.” They have activated a “Hormuz control system.” Natasha Kaneva, an analyst at JP Morgan, is quoted: “This situation has created a strait control system dependent on political agreements with Iran.”
However, The Chosun always reported caution in China over the developments. They reference SCMP’s quote of Wang Yiwei, Director of the Institute of International Affairs at Renmin University: “While this is a pragmatic measure that could garner more support than a full blockade, it could also draw China into broader geopolitical tensions. The implications of this plan could extend beyond mere energy transportation to issues of global order and geopolitical stability.” And a “diplomatic expert close to the Chinese government” told The Chosun: “Most global oil trade is not priced in yuan,” and those making deals with Iran take on a political risk: “The United States and Israel are also likely to respond with political countermeasures.”
