How Washington is making the Strait of Hormuz irrelevant — whether Iran likes it or not

The threat that isn’t really a threat

When Scott Bessent stood before G20 energy ministers in the United States and declared that the Strait of Hormuz would soon be a “worthless piece of water,” he wasn’t offering warmongering flair. He was announcing a strategy.

The Strait — the narrow chokepoint through which roughly a fifth of the world’s daily oil consumption once flowed — was closed by Iran in February following US-Israeli strikes on Iranian territory. The closure sent shockwaves through global energy markets. Brent crude, which had been trading well below $80 a barrel before the conflict, surged past $91 in days and continued climbing as uncertainty deepened. Asian markets wavered. UK households were projected to lose £2,400 in spending power over two years.

Bessent’s claim that alternative pipelines would bypass Hormuz within two years is, on its face, ambitious. But the ambition itself is the point. The US is signaling to the world that it considers the Iranian-controlled waterway expendable — and that it is actively funding the infrastructure to prove it.

Who is building the alternatives

The pipelines Bessent referenced are real, though they remain incomplete. The Eastern Route pipeline, running from Saudi Arabia through Jordan to the Mediterranean port of Aqaba, has been under construction for years. Saudi Aramco has been gradually increasing throughput along the route as a contingency plan, but it currently moves far less oil than the Hormuz corridor ever did — roughly 4 million barrels per day at full capacity compared to the 21 million that once passed through the strait daily before the war.

The UAE is pursuing its own variant: the Falconflex pipeline connecting eastern UAE fields to the Gulf of Oman, bypassing Hormuz entirely. Qatar, too, is advancing LNG export routes that sidestep Iranian waters.

None of these projects can replace Hormuz overnight. But none of them need to. What matters is the directional signal: the world’s largest oil-importing nations, led by Washington, are now investing billions in infrastructure that treats the Strait of Hormuz as a risk to be managed rather than a necessity to be accepted.

The economics of irrelevance

This is where the calculus gets interesting — and troubling for Tehran.

Iran derives a disproportionate share of its export revenue from oil that passes through Hormuz. Kharg Island alone handles approximately 90 percent of the country’s oil exports. When Bessent dismissed Kharg Island as irrelevant — after a Russian-linked AI-generated video purporting to show it destroyed circulated on social media — the message was twofold: the US can inflict damage on Iranian infrastructure, and even if it doesn’t, the island’s strategic value is evaporating regardless.

Hamid Bovard, CEO of the National Iranian Oil Company, pushed back, calling Trump’s claims “laughable” and insisting operations on Kharg were “calm and appropriate.” But the very fact that Iran felt compelled to respond to an AI video suggests how deeply the psychological dimension of this conflict has shifted. Iran is no longer just defending its territory — it is defending the relevance of its geography.

The allies are already moving

European governments are feeling the pain most acutely. The Centre for Economics and Business Research calculated that the conflict will erase £70.4 billion from UK real disposable income across 2026 and 2027. That figure isn’t theoretical — it represents the combined effect of higher energy bills, shipping insurance costs, and inflation that outpaces wage growth.

But the European response has been notably pragmatic. Countries with direct pipeline access to alternative routes are accelerating their commitments. Germany has quietly expanded its interest in Mediterranean gas deals with UAE and Qatar. France is deepening energy ties with Saudi Arabia. The EU’s emergency energy council meetings have increasingly focused on diversification rather than de-escalation — a tacit acknowledgment that the Hormuz closure may persist longer than diplomats would like to admit.

Russia, meanwhile, sees an opportunity. Vladimir Putin told Iranian President Masoud Pezeshkian in Kyrgyzstan that Moscow stood in “solidarity” with Iran and would maintain economic and trade ties regardless of the conflict. The timing is no accident: Russia benefits from high oil prices and Iranian distraction, and it has every incentive to see the US-Europe energy alliance stretch thin across new supply chains that exclude both Tehran and Moscow.

What happens next

The most consequential development may be the least discussed. Bessent said the US could announce new sanctions on Iran as early as next week, citing “great support” from allies. If those sanctions target Iran’s remaining shipping routes — not just the strait but the alternative outlets Iran has cultivated with Venezuela, Syria, and North Korea — they could further isolate Tehran economically at the precise moment it is most vulnerable.

At the same time, the US military is showing signs of strain. Retired Army Major General Randy Manner publicly called for Defense Secretary Pete Hegseth’s resignation after a purge of senior Pentagon officials. Army Secretary Dan Driscoll resigned amid reported tensions. Reports from aboard the USS Abraham Lincoln describe crews exhausted after six months at sea, with morale crumbling. Another warship is being deployed to the region.

These are not fronts that Iran is exploiting overtly. But they matter. A US military overextended across multiple theaters — the Middle East, the South China Sea, NATO’s eastern flank — is a US military that cannot credibly threaten Hormuz’s closure while simultaneously guaranteeing the security of alternative routes.

The Strait of Hormuz may not actually become worthless. It may remain operational at reduced capacity for years. But the trajectory is clear: the question is no longer whether the world depends on Hormuz, but how quickly that dependency can be shed. And on that timeline, Washington holds the cards.

For Iran, the lesson is harsh. Closing the strait proved it could disrupt global markets. But disruption without leverage is just noise — and the world is already building the walls to contain it.