The prospects for a resumption of Gulf oil exports look distant, absent a major diplomatic or military breakthrough, after Iran reportedly started laying mines in the Strait of Hormuz.
The US has struck Iranian mine-laying vessels, but the US Navy has refused to escort merchant shipping because of the risk of Iranian fire, Reuters reported.
Within the region, energy majors are scaling back operations and oil facilities continue to be hit by Iran, including the Ruwais Industrial Complex in Abu Dhabi. The knock-on effects are being seen worldwide, from US airlines facing a sharp hike in fuel costs to Asian refineries cutting exports so they can prioritize domestic customers.
The G7 club of industrialized nations has discussed opening strategic oil reserves to keep prices down, but that still leaves Gulf states grappling with an economic crisis they have long feared, didn’t initiate, and which the US is unable to resolve.
A military solution does not look close given the weapons Tehran still has at its disposal: Martin Sampson of the International Institute for Strategic Studies pointed to Iran’s barely used cruise missile arsenal, small patrol boats that can harass much larger vessels, and cyber warfare capabilities.