Trump’s Risky Strategy to Blockade Iran’s Blockade

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It is a high-stakes game of blockade to chicken. U.S. asserts control over the Strait of Hormuz, Iran, for its part threatens retaliation. For the past two days, the United States has enforced a risky naval blockade of Iran, designed to end the war on American terms. So, what are we doing? We're blockading the ports in Iran where they get oil and gas shipments.

Without oil and gas money, Iran has no economy today. A look at the strategy behind the blockade, the dangers that it poses, and whether or not it's actually working.

“We can't let a country, blackmail or extort the world, because that's what they're doing.”

They're really blackmailing the world. We're not going to let that happen. I spoke with White House correspondent David Sanger, Energy Reporter Rebecca Elly, and Military correspondent Eric Schmidt. It's Wednesday, April 15th. [Music]

David, Rebecca Eric, thank you for joining us for this roundtable discussion. We appreciate it. Great to be here. Thanks for having me. Thank you. David, I want to start with where the idea for this blockade comes from.

It emerges right after Iran basically sent Vice President JD Vance Packing, sends him home from negotiations in Pakistan with no deal.

“And suddenly, the Trump administration is confronting a pretty messy situation, a ceasefire,”

without Iran letting go of control over the straight-of-horse moves. This huge, important shipping channel. And so that seems to be where this blockade begins. Right? You're absolutely right, Michael, that it seemed intolerable to the administration

that you could end this war or move toward an end of it with the Iranians exercising control over who gets through the straight.

Because through the whole 47 years of the Islamic Revolutionary Government in place since 1979,

they basically let all traffic go through without tolls. And now all of a sudden, they managed to stop traffic. They managed to declare that there would be tolls. We're still trying to figure out how much they actually collected.

“Literally, when we say tolls, literally like the one you pass on the highway.”

Yeah, 2 million dollars. Imagine every time your easy pass went through it, put 2 million bucks on your credit card. Right? This was not a situation the US could live with. So what the US Navy needed to do was reverse the dynamic.

Make sure that it wasn't the Iranians who were controlling traffic through the straight, but that it was the US Navy that was. And that sounds like a fairly straightforward process given the size of the US Navy. But in fact, it turns out it's looking like it will be pretty complicated to execute. Okay, so Eric, just define this pretty brute force military concept of a naval blockade.

Because it's its own act of aggression. That's right. By definition, a blockade is an act of war.

And what it means is one country is basically going to use.

It's military might. It's forces to block the transit of ships from other countries. That can either be through the threat of force or actual boarding of ships and seizing them. And in this case, the United States Navy has shown up with some 10,000 sailors aboard more than

a dozen warships from aircraft carriers to destroyers to the ships that carry marines. And they're essentially parked outside of the straight of our moves. Basically waiting for any ships to come either from the Persian Gulf or trying to get from where they are in the Arabian Sea into the Gulf itself. Basically, the idea is to strangle Iran's economy, but specifically, Rebecca, to strangle its oil.

That's right.

straight in a way that its neighbors have not.

“So it's exerting this control over the waterway by attacks and threats of attacks.”

So the vast majority of the oil that has been getting through has come from Iran. So it's continuing Iran to make money from oil to, in a sense, I assume, fund its own war efforts. Exactly. And just to add to Rebecca's point here, it's not only the overall Iranian economy that's

depended on this revenue, it's particularly the government.

And within that, the Islamic Revolutionary Guard Corps, which gets almost all of its

revenue and thus its ability to pursue the war from oil exports, got it. And just to be sure, we're on the same picture, is the goal, ultimately, to rest back control of the straight, or is the goal to create a blockade that would bring Iran back to the

“negotiating table so that this war actually never ignites?”

Well, as I understand, it is really both. I mean, they don't want to live in a world in which the Iranians step out at any moment. To control the straight. If that's the case, then the U.S. has to be prepared for a lengthy presence around the straight-of-war moves.

But the real goal here is to get the Iranians to move in the negotiations. Remember, this got announced right after, right, Vice President Vance left Islamabad fundamentally empty-handed. We've since learned that they are in pretty high stakes negotiation on a number of points. But the biggest difference is whether or not Iran has to give up its nuclear stockpiles,

and whether it's got to agree to give up all enrichment of uranium. But whatever it is, the straight and control over it is the leverage President from trying to exercise here. Okay. A final question about the blockade before we get to how it's actually going so far,

which is if you're the President and you're deciding to operationalize this theoretical

“blockade, what are the risks that you're assessing as you're thinking about making this?”

I put that to all three of you. What kind of blowback boomeranging can you expect as you imagine suddenly creating this naval barrier around the straight? Well, one major risk of course is that the IRGC at Iran itself lashes out. They have threatened to attack these US Navy ships, and so you could have a major escalation

of the fighting again, based over the ships coming into the straight, or even standing back outside. So that would be one major risk that the President would have to weigh.

There's a second one I can think of, and I'm sure Rebecca's got a long list as well.

It's China. So 90% of the oil that Iran ships out is headed to China. Much of it is on Chinese crude, Chinese flag ships. The President's supposed to go to Beijing in about four weeks, and what he was hoping was going to be this meeting all about sort of a new date on between China and the United States. There were supposed to be trade deals, security, understandings, and so forth.

And all of a sudden, what's looming over it, whether or not these Chinese ships that pick up their oil in Iran, get turned back by the US Navy, that is not the kind of scene they want to be confronting, especially at a moment when there are reports as Eric and others have reported in the times that the Chinese have been considering aiding the Iranians with some kind of arms. Right, a simple, efficient way to really piss off your superpower adversary is to start to systematically deprive them of oil.

Or about any risks you want to identify?

Yes, I'd say a third big category of risk is that Iran responds by restarting attacks on energy infrastructure throughout the Persian Gulf.

And that is one that carries really long-term risks for the global energy system and the global economy, because as you do more damage to the regions infrastructure, prevent refineries from operating, you risk taking energy offline for a long period of time. And already the international energy agency has estimated that more than 80 energy sites in the region have been damaged and that bringing production back to pre-war levels could take up to two years.

Wow. So this blockade has now gone from strategic theory to reality.

or creating a bunch of strategic boomeranging blowbacks that were perhaps unintended, but now problematic.

“Eric, to start, can you describe the blockade as it now stands around the straight?”

So as I mentioned before, the U.S. Navy is positioned outside the straight of Hormus, kind of waiting for any ships bound for Iranian ports. So what President Trump is calling a blockade is really more of a quarantine. They're monitoring these ships using drones, using other open source information about where these ships are coming from or where they're going to.

And if there's a suspect ship, they can get on the radio and basically call and determine if that's a ship that they might need to board.

And if it got to that point, they could actually send boarding parties board. These would be Marines, or specially trained Navy personnel could be Navy seals. They could arrive by boat. They could come by helicopter and fast rope down onto these ships to inspect the cargo. This would really be only if the ships continue a pace.

One of the reasons why you have this blockade or quarantine is really just set at a turret. The idea that the U.S. Navy is out there, and to the shipping companies whose cargo is moving,

“do they really want to have the United States seize this cargo?”

Do they really want to challenge the United States? But I think most of the hundreds of ships that are already on scene, whether they're inside the Persian Gulf or outside, are kind of staying put. And what we're now waiting for to see if there's any Iranian back ships that dare them. We'll so far are any ships carrying Iranian oil.

The thing the U.S. blockade is meant to stop are any of those ships getting through the straight. Since the blockade started. The short answer Michael is it appears not. The central command which oversees the U.S. military operations in this part of the world issued a statement 24 hours into the blockade saying that there had been no introductions.

There had been no violations of the blockade. And in fact, there had been six vessels coming out of Iranian ports on the Gulf of Oman on the Iranian coast. That it turned around after they had been contacted by the U.S. Navy ships. So the U.S. military is pointing to that to say, look, this is working so far for the ships that we want it to affect. So in these very early hours and I guess few days of this blockade, this is succeeding if you're president Trump and the U.S. military.

Well, I'd say it's succeeding halfway. It looks like for now he has stopped the Iranians from shipping oil out and thus fueling their economy and their government. What we don't know yet, Michael, is can the commerce has been bottled up in the Gulf? ships that belong to the UAE or other Arab states who are trying to ship their oil and cargo out? Can they get past the Iranians so that the U.S. can free them out to the rest of the world?

“And that's what the future of the global economy in the next few months may depend on.”

Right, because at the end of the day, and this is going to sound like a head spinning tongue twister.

This is ultimately a blockade by the U.S. of a blockade by Iran, which makes it really messy.

Exactly. And a big question for the global economy is does this mean that no oil is going to be getting out of the Persian Gulf? Or does it allow and does it give shippers the confidence to make that run? Okay. Well, discuss that right after we take a very short break.

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So let's talk about what's happening to everyone else in the world when it comes to this blockade.

That's a great success, strategically if you're the U.S. trying to disrupt the Iranian economy and get the Iranians back to the negotiating table to end this war.

“But if you are the UAE, if you are the United States, if you're Russia, what does this blockade mean for you so far?”

Do we have any intelligence about whether cargo ships are seeing the U.S. blockade as a safety net that lets them get through to straight?

Just before coming on the program, a U.S. official told me that as many as 20 commercial vessels have now been able to transit through the straight in the first 24 hours or so.

Now the official didn't describe exactly what kind of ships, but it's assumed this is a combination of tankers, cargo ships and other things. But we really need more detail to see if this is an early indication of a broader stream, like as Rebecca said, of shipers who are now more confident that they can run the gauntlet that they weren't before. Or if this is just a momentary spurred of getting through with the U.S. Navy standing by that really doesn't have a long term effect.

“Rebecca, what are your sources telling you about the trepidation level of the captains of these ships and the companies that own them and have to pay the insurance levels that they're paying now to try to go through the straight?”

I would say it's very high and increasingly the people I speak with are starting to ask not what is it going to take to reopen the straight?

But will the straight ever go back to the way it was before the war when there was free passage, no toll, and relatively little risk of being attacked? And many people think probably not.

“Let's now turn to that question. Basically, the long term future of the straight and what it's going to look like. Is it going to be something that over time the Iranians just control, perhaps in a peace deal?”

Or does this become some sort of a joint operation over time? Does the straight ever get restored to its pre-war operations? Can that gene ever be put back into the bottle, David? I'm with Rebecca. I don't think that you're going to see it go back to the way it was any time soon because the Iranians have discovered this kind of superpower they have. They had never before tried to control the straight, and suddenly they discovered that after much of their military has been destroyed, they have the ability just by dropping a few mines, or threatening ships with shoulder-fired missiles to basically bottle up everything that's in the Persian Gulf.

So we have heard a couple of proposals. At one point President Trump just briefly suggested that maybe it would be run by him and the new Iatola Hamini. That would be a business partnership I'd like to go cover. There had been more serious proposals about creating a kind of international consortium that not only monitored what was going through, but maybe charged and divided up the tolls. You could imagine Iran would be a part of that, Oman, which is straight across the other side of the straight, the United States, which would be providing security, and then you could imagine bringing in any number of countries that are dependent on what's traveling through the straight, starting with China, maybe with India, and of course the Europeans.

That would require a level of international cooperation and diplomatic sharing of power that so far the Trump administration has not shown a great interest in around the world. And so this would be a really interesting test to building an international coalition. So David and Rebecca, what you seem to both be saying is that at the end of this conflict, the straight will never again be like the Atlantic Ocean, or like the Pacific Ocean, and be a free international waterway in which commerce occurs pretty much unimpeded and free.

We're saying never, but that is certainly something that more and more people are facing at this moment.

And when we're talking about the oil market and energy demand, that leads in a few different directions. Yeah, how do you start to plan around a world where maybe the straight is told to a degree that's not tolerable? Doesn't that require a whole new level of alternatives? I would divide it into three general buckets. One is the possibility of building more alternative routes from Gulf countries to world markets that get around the straight-of-formus.

Should we turn this or pipelines? Pipelines. Now, that is complicated as well. There are only a certain number of countries that are able to get oil from one coast to another without running across another country's territory.

So then you get into the cooperation conversation again.

“That's one bucket. Another bucket is does this increase demand for oil elsewhere in the world that you can get without running the risk of going through the straight?”

And the third is whenever oil is more expensive, it makes alternatives more attractive. And those alternatives include nuclear energy, solar power, batteries, and we're already seeing many of those conversations pick up around the world. So the entire world of energy and energy infrastructure could end up changing because of this war and to a degree because of this blockade and that could end up long outlast in the conflict itself.

In the long term, Michael, I think that's exactly what could happen. And then, of course, it's been different wars, different conflicts that have shaped our energy status in the past.

But the way I try to think about this in the short term is that we are now entering a contest over which country, the United States or Iran, can endure the pain of this blockade over the next few months. The Iranians are betting that it's Trump who is going to have to back off because the closer we get to the midterm elections with gas prices going up and now the President saying and the energy sector is saying, they may stay up through the rest of the year. That's a big political problem for the Republican Party and for Donald Trump and for his remaining term because if he loses both the House and the Senate in part because of high energy prices, his domestic agenda is basically going to be over.

I mean, their leadership in Internet memes, Trump about gas prices. In fact, their lead negotiator, the Speaker of the Iranian Parliament, basically said as he left Islamabad, you could be nostalgic for five or six dollar a gallon gas. The U.S. has a different bet, which is what they failed to do militarily in 38 or 39 days of war, they can finish off economically by cutting off Iran's main source of revenue by specifically cutting off the Islamic Revolutionary Guard Corps. And they will, in the end, come back in the negotiating table and as President Trump put it, cry uncle saying, we're going to do whatever you want to do. So far, that hasn't happened, but the President is testing to see where that point is.

And the fact matter is, if anybody tells you they know which side is not going to be able to withstand the pain first, I'm not sure I'd believe them yet. Eric, final question to you, how sustainable is this blockade if it lasts for a while? The next negotiation session between the U.S. and Iran is on Thursday, but the gap between the two countries on all the major sticking points, whether that's the nuclear program or Israel's ongoing war and Lebanon remains enormous.

“How sustainable is the blockade if it keeps being required by the U.S.?”

Well, the Pentagon has said that it can sustain this blockade as long as the President needs to. The problem is it would come at a cost of what the military has to do elsewhere around the world.

It is already drawn away ships and munitions that are badly needed at the end of Pacific to possibly counter China to deal with North Korea and a conflict there. There are also pulling away interceptors and other bombs and missiles from the European command, which could possibly have gone to Ukraine. This blockade operational loan is drawing in some 10,000 U.S. Navy Marine Corps and other service personnel. The overall operation has caught about more than 50,000 if they have to remain focused on this region, because we don't know for sure that hostilities won't break out and the President won't resume dropping bombs and missiles on Iran.

“Well, David, that actually makes me want to ask you. The very last question, is this war as a full-on war, as we think about that word, likely over?”

Because yes, we're talking about a ceasefire that hasn't solved all the major problems and we're talking about the blockade, but for the most part, these two sides are not shooting at each other right now. And I imagine there's a lot of pressure for it to stay that way. I think there is. I think it would be very hard for President Trump to go back in and conduct the kind of military operation that he ran for 38 days. His base was fragmenting over it.

Allies were not coming to America's aid, but it's not only President Trump will understand that the Iranians understand it too.

“They also want to have this war over because the effects on them and on an economy that was fragile before the fighting started is got to be huge.”

And so now the question is not whether or not the war ends, but on whose terms it ends. David, Eric, Rebecca, thank you all. Thank you. Thank you. Thank you.

“On Tuesday afternoon, the leaders of France and Britain said they would develop their own plan to reopen the straight-of-war moves.”

The plan, involving a broad coalition of governments, is expected to begin only after the war is over and may exclude the United States. I'll be right back.

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Today's episode was produced by Gaylon O'Keefe, Ricky Navezki, and Jack Disodora. It was edited by Lisa Chow, contains music by Alicia but YouTube and Dan Powell. Our theme music is by Wonderland. This episode was engineered by Alyssa Moxley. That's it for today. I'm Mike of a Law.

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