By Mohammad Sadat Khansari
At the weekend, the war of words between the United States and Iran heated up. Iranian President Hassan Rouhani threatened the United States saying that a war with Iran will be the “mother of all wars” and U.S. President Donald Trump responded by saying that he will not put up with such threats.
Now Iran is saying that if it is not allowed to use the Strait of Hormuz then no other country will be allowed. The Strait is the most important chokepoint in oil transit and more than 18 million barrels pass through every day which is more than a third of all oil that gets transported by sea.
The Iranian economy is already in a state of disaster with the impending U.S. embargo on Iran’s banking system and oil exports. After the heated exchange between the two presidents, the people of Iran quickly took to messaging application Telegram to urge their fellow citizens to buy U.S. dollars to hedge against the devaluation of their assets. Following the public dispute between Rouhani and Trump, the Iranian currency – the rial – lost 14 per cent against the dollar in the following hours.
This is a major problem because the price of the majority of things in the country has a link to the dollar. And the Iranian people are bracing themselves for even more turmoil when the sanctions take effect in November.
The European Union, however, is trying to keep the deal intact and it is trying to offer guarantees on oil revenue to make up for U.S. sanctions. The EU has said that it will transfer funds through the European Investment Bank (EIB) so that they go straight to Iran, but many experts are sceptical that this will happen.
The Iranian Regime is claiming to close the Strait of Hormuz because it will create enough pressure on the oil flow that many countries would urge the U.S. to reconsider. However, it is unclear whether Iran has the capability of closing the Strait as it would take considerable military forces. Iran does not have a great deal of naval resources that could compete with the technology of the West. Nevertheless, a large number of small vessels and cruse missiles is a threat that must be taken seriously.
Iranian regime’s officials, including Supreme Leader Ali Khamenei, have often made extreme threats that they cannot keep. Threats were made when the nuclear deal was being negotiated, but when Iran did not get what it wanted, the deal was made anyway and Iran didn’t mention the threat again.
The Iranian regime is likely just spouting hot air and a closure of the Strait is more than it can cope with in its weakened position. It is facing pressure from all angles, especially on the domestic front. The people of Iran are fed up with the Iranian regime’s belligerence and the regime knows that the people will not let up in their pursuit of regime change.
All the regime can do is a desperate scramble to hang in there and prolong the inevitable.
Mohammad Sadat Khansari is a researcher analyst and consultant, specializing in Human Rights, political and social affairs. He has expertise in Iran, and the Middles East affairs.