Iran War Topic Week

By Rustam Taghizade

The Strategic Paradox

When the Trump administration granted India a 30-day waiver on March 5 to purchase Russian oil, the formal justification was straightforward: stabilize global energy markets after Iran effectively closed the Strait of Hormuz. Yet beneath the surface, a deeper story unfolded. The waiver revealed a tension between two pillars of contemporary U.S. strategy—the use of maritime power to secure global chokepoints and the use of economic sanctions to punish adversaries. In the spring of 2026, those two pillars collided, and Russian oil began flowing to India because Iran had shut the strait.

For 10 months before the Iran war began on February 28, Washington had pressured New Delhi to reduce its imports of Russian crude, and the campaign was partially successful. Russia’s share of Indian oil imports fell from 36 percent to 31 percent by early 2026. The United States had sanctioned Russian energy companies and made clear that continuing to buy Russian oil would jeopardize relations.

Then the war came. Within days, Iran effectively closed the Strait of Hormuz, through which 85–90 percent of India’s crude and liquefied petroleum gas normally transited. Tanker traffic plunged by 97 percent. India’s strategic petroleum reserves stood at barely one month’s supply.

Faced with an energy crisis, New Delhi looked to the only substantial source of crude still within reach: Russian oil already at sea. Approximately 65 million barrels of Russian crude were floating within a thirty-day sailing radius of Indian ports—cargoes loaded before the November 2025 sanctions but now stranded because of the war’s disruption.

The choice for Washington was stark: either insist on sanctions compliance and watch India’s economy suffer or grant a temporary waiver and allow Russian oil to flow. The administration chose the waiver. It did so not because it trusted Moscow, but because the closure of Hormuz had rendered its own sanctions architecture operationally irrelevant.

 The Numbers Behind the Decision

Indicator	Pre-war (February)	Post-Closure (March)
Daily tanker transits through Hormuz	151 vessels	4-5 vessels
Daily tanker transits through Hormuz	85-90 %	Effectively zero
Russian crude within 30 days of India	——–	65 millions barrels
Indian strategic petroleum reserves	1 month	1 month

The arithmetic was unforgiving. Without the waiver, India’s energy supplies would have faced a catastrophic gap. With the waiver, Russian oil could reach Indian refineries while Washington bought time to try to reopen the strait.

A Game Theory Perspective

The interaction among the four central actors—the United States, Iran, India, and Russia—can be illustrated with a simple payoff matrix. The two primary players are the United States and Iran. Their strategies determine the environment in which India

	Iran Keeps Strait Closed	Iran Opens Straight
US Maintains Sanctions	(-2, -2) – War drags on; India faces energy crisis; Russia gains little market access	(+4, -1) – US sanctions effective; Iran loses leverage; India returns to Gulf oil
US Grants Oil Waiver	(-1, +1) – Iran gains tactical win; Russia sells oil; US sanctions undermined	(+3, +3) – Normal trade restored; both sides avoid worst outcomes

The matrix shows why the waiver was strategically rational despite its contradictions. When Iran keeps the strait closed and the US maintains sanctions (top-left cell), both lose: the war continues, India suffers, and Russia gets no extra revenue. When the US grants a waiver while the strait remains closed (bottom-left), Iran retains its coercive leverage but Russia gains a vital market—a net positive for Moscow and Tehran, but a loss for Washington’s sanctions regime.

The only outcome that fully satisfies all actors is the bottom-right cell: an open strait and normal oil trade. That cell remains out of reach for as long as the Hormuz closure persists.

The Evolving Waiver Framework

What began as an India-specific emergency measure has since taken on a more structured form. On March 5, the Treasury issued a waiver allowing Indian refiners, IOC, BPCL, HPCL, and Reliance Industries, to purchase Russian crude cargoes that were already in transit. When the Treasury expanded the waiver on March 12–13, Indian refiners remained the only significant buyers of the authorized Russian barrels.

Crucially, the expansion continued to apply only to cargoes already on the water, did not restore formal banking channels, and did not lift underlying sanctions. As Miad Maleki, a former US Treasury official, explained, General License U authorized “the commodity transaction; it says nothing about payment.” The license permits the sale of oil but does not restore banking access or create a formal payment channel, a distinction that allows trade in physical barrels while preserving financial pressure.

On March 20, Washington applied the same waiver model to roughly 170 million barrels of Iranian crude floating offshore. Once again, India remained the only swing buyer. Reliance Industries purchased 5 million barrels of Iranian crude at a $7 premium to Brent, and other Indian refiners reportedly plan to resume purchases. The effect was immediate: India’s participation disrupted China’s near-monopsony over sanctioned Iranian crude, reshaping pricing leverage without formally lifting sanctions.

India’s Strategic Ascent

The waiver’s implications extend beyond temporary oil supply management. Before 2019, Indian refiners imported roughly 450,000 barrels per day of Iranian crude under contracts with the National Iranian Oil Company. They retain the technical configuration and commercial familiarity to scale quickly within short waiver windows—institutional memory that gives Washington a ready-made alternative buyer base whenever it chooses to recalibrate supply pressure.

India’s admission into the Pax Silica on February 20 formalized its role within the US-led supply chain initiative focused on reducing dependence on China in semiconductor and AI production. Prime Minister Narendra Modi visited Israel on February 25–26, where the two countries elevated ties to a “special strategic partnership.” Two days later, Operation Epic Fury began. Together, Pax Silica realigns industrial supply chains while the waiver framework redirects sanctioned energy flows, positioning India within the technological and commodity axes of great-power competition.

What the Crisis Reveals About Maritime Coercion

The episode underscores three limits of maritime coercion as a tool of statecraft.

First, naval power alone cannot guarantee passage through a contested chokepoint. The U.S. Navy maintains two carrier strike groups in the region, yet it could not prevent Iran from functionally closing the strait. Iran’s asymmetric toolkit, cheap drones, naval mines, and shore-based anti-ship missiles, imposes costs that even a superior navy cannot easily neutralize without escalating to a ground invasion, which Washington has repeatedly ruled out. As of March 26, American forces had sunk at least 60 Iranian warships and destroyed numerous fast attack boats, yet the strait remains effectively closed.

Second, economic sanctions are vulnerable to physical disruption of trade routes. Sanctions on Russian oil worked as long as alternative supplies were available. Once the Strait of Hormuz became impassable, those alternatives vanished. India’s energy needs forced a choice between sanctions enforcement and energy security. The latter won.

Third, secondary sanctions lose credibility when the primary chokepoint is closed. The United States spent years building a coalition to enforce sanctions on Russian energy. That coalition expected that compliant states would have access to reliable energy markets. When those markets were cut off by an adversary, the sanctions architecture buckled. India’s waiver was not a sign of policy reversal but a consequence of strategic interdependence.

The New Russia-India Energy Axis

India’s calculus changed rapidly after the war began. By March 19, Russian Deputy Energy Minister Pavel Sorokin and Indian Petroleum Minister Hardeep Singh Puri had reached a “verbal agreement” to negotiate a liquefied natural gas deal, the first such direct supply since the start of the Ukraine war. The two officials also agreed to further increase crude oil sales to India, which could double from January’s levels to at least 40 percent of India’s total imports in about a month.

Indian refiners have already purchased approximately 60 million barrels of Russian oil for April delivery, which is more than double February’s volumes. The purchases are priced at $5–15 per barrel above Brent, reflecting the shift to a seller’s market.

Some Indian policymakers have lamented that New Delhi cut Russian crude imports as a concession to the U.S. before the war. A government briefing note prepared for the cabinet secretariat on March 20 warned that a prolonged disruption of oil flows from the Middle East would prompt a cascade of economic challenges: higher inflation, a weaker currency, and rising foreign debt. Export growth could take a hit of between 2 and 4 percent, and wholesale inflation could rise by 0.3 to 0.7 percent.

As Ajai Malhotra, a former Indian ambassador to Moscow, put it: “India chose the course that best served its national interests, anchored in a long-standing and trusted partnership with Russia.”

The Iranian Calculation

Iran, for its part, has calibrated its control over the strait with precision. Satellite data and marine traffic analysis show that between four and five vessels now transit the strait daily, down from 151 before the war. Most of those getting through are linked to Pakistan, China, and India—countries Iran does not consider “aggressors.”

Vessels seeking passage have reportedly stopped at Qeshm Island, where Iranian authorities check ownership, insurance, and crew connections to ensure no link to the U.S. or Israel. Some ships have also navigated outside normal shipping channels, hugging the Iranian coastline to avoid the most contested waters.

Homayoun Falakshahi, head of crude oil analysis at Kpler, noted that Iranian crude often remains unsold until reaching Asian discharge zones such as Singapore or Malaysia. By releasing cargoes under the waiver, Washington created immediate supply effects. “Now that India has entered as a competitor, the price in China will most likely increase,” Falakshahi said.

Long-Term Implications

If the Hormuz closure persists, Washington will face increasingly difficult trade-offs. The most immediate is whether to extend the waiver beyond the current framework, expand it to cover future cargoes, or allow the sanctions regime to collapse entirely. The second is whether to invest in alternative supply chains that bypass the Gulf—a process that would take years. The third is whether to accept that the era of frictionless maritime sanctions is over.

The United States is also preparing to launch a new insurance program for ships moving through the strait, providing government-backed guarantees along with naval support. First announced on March 3, the program is expected to begin soon, but there is no clear evidence that any ships have yet used it. Insurance remains available from commercial markets including Lloyd’s of London, but the cost has increased sharply. This suggests that the main concern for shipowners is not insurance, but the risk of attacks.

Treasury Secretary Scott Bessent has expressed confidence that traffic will increase. “We have seen more ships coming in and out of the Gulf today than we saw yesterday, and that’s just the beginning,” he said on March 26. Whether that confidence is justified remains to be seen.

This structural contradiction is now colliding with a second, even more politically charged layer: the public discussion of how the war might end. Leaks from the administration, deliberately planted, suggest two possible “victory” scenarios: seizing Kharg Island or removing Iran’s enriched uranium stockpile from Isfahan. Neither withstands basic scrutiny. Kharg is a single pipeline fed by one onshore pumping station. A single bomb could disable it without risking a Marine expeditionary unit. Isfahan’s nuclear site is buried under hundreds of tons of rubble from previous strikes and lies 400 miles inland. No amphibious force could realistically excavate and extract anything. What these narratives reveal is not a military strategy but a political one. The administration is looking for a way to manufacture a success. The hardware moving into the Gulf and the carefully leaked conversations do not match the facts on the ground. They match the need for a story.

Conclusion

The March 5 oil waiver was not an anomaly. It was the inevitable result of a collision between two core elements of U.S. strategy: using maritime power to secure chokepoints and using economic sanctions to isolate adversaries. When those elements come into conflict, the more immediate one, physical access to energy, will usually prevail.

The Strait of Hormuz remains closed. Until it opens, the contradictions will persist. In those contradictions, Russia has found an unexpected opportunity to sell its oil, India has secured a necessary supply, and the United States has been reminded that even the most powerful navy cannot always enforce a sanctions regime without a secure strait. What began as a temporary wartime measure is now shaping a broader realignment, with India positioned at the center of both the technological and commodity axes of great-power competition. As a result of this complex historic moment, Russia has regained market access at a critical moment, while the United States has discovered that maritime coercion, however potent, cannot substitute for a functioning global energy architecture—one that its own sanctions policies helped dismantle.

 Rustam Taghizade is a geopolitical risk analyst specializing in maritime security, energy geopolitics, and the Caspian-Middle East corridor. He has contributed to Al Jazeera and is currently co-authoring a study on Iran’s post-war trajectory.

References

[1] Iran International. “US may deploy up to 17,000 troops near Iran as war enters new phase — WSJ.” March 26, 2026.

[2] The Jerusalem Post. “Voices from the Arab press: Iran threatens global shipping in Strait of Hormuz.” March 21, 2026.

[3] News On AIR. “United Arab Emirates on heightened alert amid rising West Asia tensions.” March 14, 2026.

[4] Central News Agency (Taiwan). “Bessent: Insurance program for Strait of Hormuz shipping to launch soon.” March 27, 2026.

[5] Hindustan Times. “Trump’s Iran war pushes India to rekindle old friendship with Russia.” March 26, 2026.

[6] Radio-Canada International. “How some ships are still getting through the Strait of Hormuz as Iran war drags on.” March 26, 2026.

[7] China Energy News. “India purchases 60 million barrels of Russian oil for April supply.” March 26, 2026.

[8] Hellenic Shipping News. “Container Shipping: Iran war amplifies outlook uncertainty.” March 26, 2026.

[9] SETN News. “US considers seizing Kharg Island.” March 26, 2026.

[10] Marine Insight. “U.S. Set To Launch Insurance Program To Revive Shipping Through Strait Of Hormuz.” March 26, 2026.

Featured Image: Arleigh Burke-class guided-missile destroyer USS Rafael Peralta (DDG 115) enforces a maritime blockade against an Iranian-flagged vessel. (U.S. Central Command photo)

Iran War Topic Week

By Bruce Randolph Tizes

Most analysis of the U.S.-Iran maritime war will focus on carrier strike group positioning, IRGC small-boat tactics, Marine Corps Stand-in Forces, and the operational lessons of contested chokepoints. Those analyses are necessary. They also miss a dimension Iran has built as deliberately as its mine and drone programs, one that will outlast any ceasefire: the commercial and insurance layer through which maritime trade is priced and governed. Iran is contesting the Strait kinetically. It is also contesting the distributed commercial calculus that determines whether the Strait functions as a global energy corridor at all.

The Trump administration responded with an instrument no prior administration deployed at scale. The $40 billion DFC-Chubb maritime reinsurance facility, announced March 6 and expanded April 3, 2026, treats war-risk insurance as a strategic domain and commits sovereign capital to it within weeks of a crisis beginning. The question this article addresses is whether, at a chokepoint with no bypass and under sustained war-risk pricing pressure, sovereign intervention in the insurance layer meaningfully shifts commercial behavior. The answer is yes, conditionally. Four conditions remain open before that authority becomes fully activated and durable.

The Mechanism

On December 18, 2023, the Joint War Committee (JWC), the body of Lloyd’s Market Association and London company market underwriters, extended its listed areas to cover the southern Red Sea and Bab al-Mandab. Within weeks, container ship transits through the Suez Canal collapsed by roughly 67 percent. That cascade was not driven by any single battle. It emerged from commercial decisions, reroutings, surcharges, and contract renegotiations that followed the listing.

When a corridor appears on the JWC list, standard war clauses in hull insurance policies activate cancellation-and-reinstatement mechanics, war-risk premiums reprice on a voyage-specific basis, and charterers, financiers, and flag states reassess exposure in parallel. A vessel facing a listed area does not lose the legal capacity to sail. It faces sharply higher costs and friction. When war-risk premiums rise by an order of magnitude, when charter parties invoke war clauses, and when letters of credit require renegotiation, the aggregate effect is to reroute.

This is the layer Iran’s coercive maritime architecture is built to manipulate. The March 11, 2026 attack on the Thai-flagged Mayuree Naree makes the calibration explicit: Iranian unmanned surface vessels targeted the ship’s rudder and propeller, immobilizing it rather than sinking it. Iran is not trying to fill the Strait with wreckage. It is trying to make the commercial calculus of transit prohibitive.

The Instruments

Three insurance instruments often conflated in discussion operate on distinct legal foundations.

Hull war-risk insurance covers physical damage to the vessel from war perils. Placed in specialized markets, including Lloyd’s syndicates, the London company market, Bermuda carriers, and specialty war-risk underwriters, it reprices dynamically when the JWC lists a corridor and is the layer most sensitive to kinetic risk signals.

Protection and Indemnity (P&I) cover is mutual insurance for third-party liabilities, including crew casualty, pollution, wreck removal, cargo claims, and collision liability. Within the International Group, twelve associations cover roughly 90 percent of ocean-going tonnage. P&I is bundled with certificates of financial security required under the 1992 Civil Liability Convention and the 2001 Bunkers Convention. These Blue Cards, issued by the P&I Club to the flag state, underpin the Certificate of Insurance that port-state control examines at entry. A vessel retains that certificate regardless of whether the JWC has listed the waters it transited.

The interaction among these instruments produces accumulated pressure rather than single-point failure. Hull war-risk cover becomes prohibitively expensive or subject to voyage-specific underwriting. P&I Clubs issue guidance straining cover conditions. Charterers invoke war clauses. Cargo financiers decline to fund shipments without additional guarantees. Transit volumes decline even though no single instrument has formally failed. Sanctions compliance risk, banking appetite, schedule reliability, and carrier network economics compound the pressure further.

The 2024 Red Sea Record

The United States announced Operation Prosperity Guardian on December 18, 2023, the same day the JWC extended its listing. U.S. and U.K. strikes against Houthi targets began January 11–12, 2024. Naval action degraded Houthi strike tempo. The JWC listing did not move.

War-risk premiums for Red Sea transits, which had been running near 0.05 percent of hull value before the crisis, rose into a range of 0.5 to 1.0 percent per voyage. On a $100 million hull, that is an incremental $500,000 to $1,000,000 per transit. Container ship transits through the Suez Canal dropped more than 60 percent by the fourth quarter of 2024 against 2023 levels. Maersk, MSC, CMA CGM, and Hapag-Lloyd continued routing around the Cape of Good Hope through the end of 2025, even after the Houthis announced a ceasefire in November 2025, because premiums had not normalized and the JWC listing remained in force. The operational record and the commercial record bifurcated and did not rejoin on the same timeline. The Indian Ocean High Risk Area designated for Somali piracy in 2010 was not removed until January 2023, more than a decade beyond the operational peak. Pricing inertia at Hormuz will behave differently, but not more favorably.

Hormuz has no bypass comparable to the Cape of Good Hope. Approximately 20 percent of the world’s seaborne oil trade and one-fifth of global LNG transit the strait. LNG arbitrage, strategic stockpile releases, and cargo reshuffling can moderate the shock on the margin. None preserves the commercial economics of the pre-crisis routing pattern at scale.

What the 1987–88 Tanker War Does Not Explain

The standard historical counterargument cites the Iran-Iraq Tanker War: sustained attacks across eight years, hundreds of merchant incidents, commerce continued. Lloyd’s priced the risk. Operation Earnest Will reflagged Kuwaiti tankers. The implicit conclusion is that determined naval presence restores commercial flow.

Three features distinguish the current situation. The first is attribution. Iraqi Exocet launches and Iranian attacks on identifiable Gulf-bound tonnage presented a priceable risk distribution. A corridor where mines of uncertain vintage sit in water that cannot be fully mapped presents underwriters with a distribution they struggle to model. Coverage does not simply become expensive; it becomes subject to exclusions, warranties, and voyage-specific reinstatement. The second is market structure. The 1988 London markets operated with broader war-risk appetite and more distributed capacity. The International Group’s reinsurance structure is now concentrated in an annual placement renewing each February 20, and syndicates that cannot price Hormuz exposure typically decline to write it rather than price through it. The third is sovereign presence. The 1987–88 system had no sovereign substitute in the war-risk layer. The United States in 2026 has deployed one.

The Development Finance Corporation Facility

On March 3, 2026, President Trump ordered the DFC to provide political risk insurance for maritime trade through the Gulf. On March 6, DFC CEO Ben Black and Treasury Secretary Scott Bessent announced a $20 billion maritime reinsurance facility coordinated with CENTCOM, covering Hull and Machinery and Cargo war risk. The facility committed federal capital on a timeline measured in weeks rather than the months typical of interagency coordination, signaling that the United States intended to act in a domain it had historically left to London.

On April 3, 2026, DFC and Chubb announced expansion to $40 billion total, with Travelers, Liberty Mutual, Berkshire Hathaway, AIG, Starr, and CNA joining as partners. The structure splits risk evenly: $20 billion backed by sovereign U.S. capital through DFC and $20 billion pooled by the consortium. Chubb was established as named lead underwriter, responsible for pricing, terms, policy issuance, and claims management across all three coverage lines: War Hull, War P&I, and War Cargo. Hull war cover protects the ship; cargo war cover protects the goods; the April 3 P&I extension reached the third-party liability layer whose constraint most compounds pressure on chartering and financing decisions.

The facility’s eligibility architecture carries a second function beyond restoring commercial flows. DFC outlined a rigorous Know Your Customer and sanctions-screening process covering IMO number, flag, crew composition, registered owner and ultimate beneficial owners with their domiciles, cargo type and value, cargo ownership, and lenders financing the vessel.

This vetting is designed to deny coverage to vessels intending to pay Iranian transit tolls or engage in sanctionable activity, aligning with OFAC FAQ 1249, issued April 28, 2026, which confirmed that payments to the Government of Iran or the IRGC for safe passage through Hormuz are not authorized for U.S. persons and create significant sanctions exposure for non-U.S. persons as well. Coverage eligibility and sanctions enforcement now operate as a single instrument.

The Convoy Conditionality

The facility carries a structural feature that neither the March 6 nor April 3 press releases made explicit but that Greenberg disclosed in Chubb’s Q1 2026 earnings call transcript on April 22, 2026: coverage is linked to U.S. naval convoy operations, and purchasing cover from the DFC-Chubb facility is required to join any U.S.-run convoy through the Strait. In Greenberg’s own words: “The government wanted to support shipping through the Gulf and open when they think that the risk environment is such that they can support with military convoys ships that would transit the Gulf and that has yet to occur.”

The convoy system materialized briefly. Project Freedom, launched May 4, 2026 by U.S. Central Command, guided a small number of vessels through an enhanced security corridor along Oman’s territorial waters before being paused by President Trump on May 6, after less than 48 hours and two confirmed transits. As of mid-June, the facility has not provided coverage at meaningful scale and is architecturally sound but not yet fully activated.

This conditionality clarifies the facility’s logic rather than exposing a weakness. The DFC-Chubb instrument is not designed to operate in a corridor that has not been assessed and cleared for routine commercial transit. It is designed to price the commercial risk for vessels transiting under military protection, converting the kinetic and financial instruments into a single package. The gap between that design intent and current operational reality is precisely what the conditions below address.

The Mine Problem

Chubb cannot price individual voyage risk into a corridor whose mine geometry is undefined. CENTCOM confirmed on March 10 that U.S. forces destroyed 16 Iranian mine-laying vessels near the Strait, and Reuters reported that day, citing two U.S. government sources, that Iran had deployed approximately a dozen mines in the waterway, including rocket-propelled EM-52 rising mines designed to defeat conventional magnetic and acoustic sweeping. Open-source reporting in April, corroborated by DefenseScoop citing U.S. officials, indicated Iranian command channels lacked a complete record of mine placements and that ocean currents may have shifted them further. The source base for that specific claim warrants caution, but it confirms what underwriters already infer from the broader picture: the placement distribution cannot be modeled with confidence.

The U.S. Navy entered this crisis without the mine countermeasures (MCM) assets needed to produce a cleared-corridor picture on a commercial timeline, following implementation of the FY2025 force-structure and shipbuilding plan. The Biden administration’s decommissioning of all four Bahrain-based Avengers—formally scheduled in the FY2025 shipbuilding plan published in March 2024 and executed seven weeks before the Hormuz closure—left the United States without the specialized assets needed to clear the corridor its insurance facility requires. These vessels—their wooden, low-magnetic-signature hulls specifically engineered for mined waters—were replaced not by a proven successor but by the promise of one. They physically departed the theater aboard the M/V Seaway Hawk on January 9, 2026, before Iran began mining. The Independence-class Littoral Combat Ships (LCS) designated as replacements were in Asia when the crisis began, and their MCM mission package carries documented reliability concerns: Naval News reported combat-ineffective sensor performance, lift-system single points of failure, and a runaway unmanned surface vehicle during testing. The two Avenger-class ships now being rushed to the theater, USS Chief and USS Pioneer, were homeported in Sasebo, Japan when Iran began mining.

By April 11, CENTCOM announced that guided-missile destroyers USS Frank E. Peterson and USS Michael Murphy had begun “setting conditions” for mine clearance—platforms not designed for the MCM mission. What MCM capacity determines is not whether any transits occur, but whether routine commercial flows resume at normalized insurance rates. The sovereign insurance facility is architecturally complete. The physical assessment on which its commercial terms depend is not.

Why the Insurance Layer Matters

When the United States assumes the role of primary provider of maritime war-risk coverage for Gulf energy flows, it acquires something prior administrations did not possess: durable positional authority in a domain through which global energy commerce must pass. Three forms of value accrue.

Economic. The war-risk insurance layer is where global energy trade is priced under crisis conditions. A sovereign providing capacity at scale in that layer sets reference terms the broader market prices against. U.S. underwriters, reinsurers, and U.S.-domiciled capital gain structural advantage in a market centered on London for a century. Facilities, expertise, and institutional relationships built for Hormuz become the default architecture when the next chokepoint crisis emerges. The United Kingdom built Lloyd’s position through sustained presence of exactly this kind. That opportunity is present now.

Political. Allies and partners whose energy security depends on Gulf transit, including Japan, South Korea, India, and most of Europe, will route their insurance, financing, and flag-state decisions through or around architecture the United States controls. That is leverage operating continuously through commercial channels, without coercive political cost.

Strategic. The insurance layer is where state actors increasingly contest maritime commerce below kinetic thresholds. Iran’s calibration of its architecture around pricing and availability rather than vessel destruction demonstrates the pattern. A sovereign capable of meeting that form of coercion with its own capacity holds a continuing instrument of statecraft. Withdrawing from the layer after the immediate crisis passes surrenders that instrument before its strategic value has been tested.

What Hormuz Teaches About Future Chokepoints

The Iranian approach is not idiosyncratic. It is a doctrine that can be exported. The Houthi campaign at Bab al-Mandab, also conducted without sinking commercial tonnage at significant scale, produced the same coercive effect through the same insurance-layer mechanics. Both campaigns achieved the consequence their sponsors sought: routing decisions made by underwriters, charterers, and banks rather than admiralty courts or naval commanders. The downstream consequences reach well beyond energy. The Hormuz closure simultaneously severed roughly one-third of global seaborne fertilizer trade, with potentially severe implications for food security in import-dependent regions including Yemen, Somalia, and parts of the Sahel.

The Taiwan Strait is the most consequential next case. A PLA Navy posture producing even a credible mine threat, combined with surface or undersea action below an Article 5 threshold, would force JWC consideration of strait waters and surrounding approaches. Coverage friction and premium escalation would impose serious economic costs on Japan, South Korea, and Taiwan itself well before any kinetic confrontation reached a decisive threshold. Russia has experimented with similar logic through undersea cable incidents in the Baltic and Eastern Mediterranean, where attribution is uncertain and pricing distributions are difficult to model. The Black Sea grain corridor required a sovereign-backed war-risk facility, brokered by Marsh McLennan with the Ukrainian government and Lloyd’s underwriters, because the commercial layer would not otherwise function. The Hormuz crisis is that precedent at an order of magnitude larger scale.

State and proxy actors with limited ability to win conventional sea battles are learning to coerce through the insurance layer, where attribution is ambiguous, pricing is sticky, and military force does not directly translate into commercial reopening. The capacity the United States is building for Hormuz becomes the template for what gets deployed at the next chokepoint. Whether that template is durable, allied, and operationally connected to military assessment determines whether the United States holds the instrument or rebuilds it under pressure each time.

The Skeptical Case

The thesis places the insurance layer among the central variables in maritime coercion. A responsible version must engage the most authoritative challenges.

The most direct challenge comes from the Lloyd’s Market Association. In a March 23, 2026 market statement, the LMA clarified that war insurance remains available for Hormuz transits. Eighty-eight percent of Lloyd’s marine war syndicates surveyed retained appetite to write hull war risk, and P&I cover was described as non-cancellable. The LMA’s conclusion was plain: the reason ships are not moving is safety, not insurance availability.

This refines the argument rather than defeating it. The piece does not claim coverage has vanished. It argues that pricing friction and accumulated commercial pressure shape routing decisions. The LMA’s own traffic data confirms the effect: of 111 cargo-carrying transits recorded from the opening of hostilities through late March, over 60 percent carried an Iran nexus through Iranian ownership, flag, or negotiated Iranian consent. Western commercial shipping has largely self-excluded. Safety and insurance pricing are not competing explanations; they are compounding ones. When masters assess physical risk as prohibitive, underwriters price accordingly, and when underwriters price through exclusions and voyage-specific reinstatement, charter parties and banks amplify the friction further. The DFC-Chubb facility is not a substitute for safe passage. It is the pricing architecture for when passage becomes safe enough to resume.

A second challenge is that premium spikes are historically absorbed through surcharges, charter party renegotiation, flag changes, and selective risk acceptance. The DFC-Chubb facility could prove less a re-architecture than a well-timed capital injection that smooths an adjustment the market would have made anyway. What that view does not account for is the Red Sea record: redundant engineering did not restore Suez transit volumes after two years of naval action because the composite of premium levels, charter economics, financing friction, and reputational risk remained adverse. Hormuz presents a harder version of the same problem with no bypass.

What Determines Whether the Facility Endures

The Trump administration has recognized the insurance layer as a key strategic domain and deployed sovereign capital into it at speed. Statutory certificates continue to be issued through flag states on the basis of approved-insurer cover. Port-state control continues to examine those certificates. Treaty regimes remain in force. What has changed is the range of available pricing and coverage options within which that law operates, and who now sets the reference terms. Four conditions are likely to determine whether that change endures.

First, the convoy system must operate at meaningful scale. The DFC-Chubb facility was designed around naval escort, and the two confirmed transits under Project Freedom before its May 6 pause illustrate both the concept’s validity and its current limits. For the insurance facility to function as designed, military escort must operate at a scale and regularity that commercial operators can plan around. A facility built on convoy conditionality that cannot field convoys is underwriting architecture without an underwriting event.

Second, sufficient MCM capacity must be available to define and maintain a commercially usable corridor. The decommissioning of the Bahrain-based Avengers left the United States reliant on platforms not designed for the mission, and the concrete options are limited: fast-track the LCS MCM package to demonstrated operational reliability, invest in allied MCM capacity under burden-sharing, or expand forward basing posture for the remaining Avengers. Chubb cannot price voyage risk against a corridor whose mine geometry remains undefined, and that geometry will not be defined without purpose-built MCM assets in theater.

Third, a standing CENTCOM-DFC operational channel is likely necessary. A formal mechanism, whether named a Joint Maritime Risk Assessment cell or something equivalent, through which CENTCOM’s corridor assessment translates directly into DFC voyage eligibility determinations and Chubb policy terms, is essential. Without it, sovereign capital and private underwriting architecture operate in parallel rather than in concert. This is an interagency coordination requirement, not a budgetary one, and it can be established by executive direction. The same intelligence-to-finance channel logic that governs sanctions enforcement can govern voyage underwriting.

Fourth, the facility will likely require a durable governing structure and broader allied participation. The DFC facility as publicly described lacks the pricing discipline, allied cost-sharing, and exit optionality that would make it sustainable over time. The National Flood Insurance Program, established in 1968 as a temporary measure, carries approximately $22.5 billion in accumulated debt to Treasury not because federal insurance is strategically valueless but because its structure lacks those features. The authority in 46 U.S.C. Section 53902 permits a targeted amendment establishing a transit-count or time-based schedule after which sovereign coverage contracts toward a reinsurance role, JWC delisting as an explicit drawdown trigger, and a tie to the International Group’s February 20 annual renewal as a structured off-ramp. Japan, South Korea, and India together account for a substantial share of daily Hormuz oil flows and currently contribute nothing to the facility. India has deployed warships under Operation Urja Suraksha to escort its own flagged vessels, a bilateral response to a global problem. The G7 Leaders’ process and bilateral treaty frameworks provide the lever to formalize allied participation, distribute cost, and convert American positional authority from a unilateral expenditure into a governed alliance asset. Structured this way, the facility also signals to Iran that the pricing-pressure instrument has been permanently foreclosed, not merely paused.

The insurance layer at Hormuz now reflects American sovereign capital working alongside private actuarial judgment rather than waiting on it. The eligibility vetting process has merged sanctions enforcement with underwriting eligibility, giving Washington direct visibility into who transits and under what financial arrangements. The statutory authority, the interagency relationships, and the allied diplomatic frameworks through which these four conditions can be met already exist. Whether they are met before the facility’s structure is set by inertia rather than design will determine whether the instrument endures.

Bruce Randolph Tizes applies formal methods from dynamical systems theory and game theory to long-horizon strategic and systemic risk across law, medicine, and national security policy. He is a rostered Fulbright Specialist, a Fellow of the Royal Society of Arts, and is affiliated with the Center for Bioethics at Harvard Medical School.

Featured Image: In this file photo taken on April 30, 2019, Iranian soldiers take part in the National Persian Gulf Day in the Strait of Hormuz. (Atta Kenare/AFP)

Iran War Topic Week

By Admiral Massimo Vianello (Ret.) and Master Chief Petty Officer Giovanni Giorguli (Ret.)

The conflict between Iran and the Israel-United States alliance confirms that conventional armed forces must currently confront asymmetric threats that subvert the logic of traditional power projection. In the maritime domain, naval mines, sabotage, and unmanned systems (UAVs, USVs, and UUVs) offer a highly favorable cost-benefit ratio for the weaker actor: low-cost attritable swarms can saturate adversary defenses, effectively neutralizing the overall technological gap.

These threats, once categorized as one-off tactics employed in isolation, are now weighted by indigenous industrial capacities and employed at scale by Iran and its proxy networks. They are systematically integrated with cyber operations and strategic disinformation campaigns designed to destabilize financial markets, energy security, and global communication architectures.

In the Middle Eastern theater, Iran exercises strategic control over the Strait of Hormuz through the employment of Unmanned Aerial Vehicles (UAVs), sea mines, coastal defense cruise missiles (CDCMs), and Fast Inshore Attack Craft (FIAC), deliberately avoiding a conventional naval engagement that would result in its defeat. The global economic fallout – reduced energy availability, supply chain disruption, and the escalation of insurance premiums and fuel costs – generates political instability and constrains international relations. When such a posture is sustained by great powers, it can be maintained over the long term, as demonstrated in the Ukrainian theater where Western-funded mines, drones, and missiles have effectively contained the Russian navy’s operational freedom.

The shifting paradigm of maritime engagement in the Middle Eastern theater, specifically within the Strait of Hormuz, underscores a transition from traditional naval confrontation to a sophisticated asymmetric and multi-domain posture. This analysis examines the Iranian threat profile, characterized by the integration of Anti-Access/Area Denial (A2/AD) strategies, and highlights the critical role of naval mining and the proliferation of unmanned systems. Furthermore, this article explores the emergence of seabed warfare as a critical operational domain, highlighting the vulnerability of Critical Undersea Infrastructure (CUI) and the necessity for persistent Seabed-to-Space Situational Awareness (S3A). By evaluating the integration of Emerging Disruptive Technologies (EDTs) and artificial intelligence driven autonomous systems, this paper argues for a balanced, gradual evolution toward autonomous systems, while addressing the operational, legal, and ethical challenges posed by the robotization of the maritime battlespace.

The Profile of the Iranian Threat

Following the 1979 Islamic Revolution, Iran adopted a posture of radical ideological and strategic hostility toward Israel, severing all diplomatic ties. Refusing to recognize the Jewish state, Tehran has employed rhetoric calling for its destruction and has long conducted a proxy war against Israel through a network of militarily and financially supported affiliates (Hezbollah, Hamas, and the Houthis). Tehran pursues a nuclear program, which Israel perceives as an existential threat. Furthermore, Iran views the United States as a threat to its sovereign survival. Consequently, Iran has consistently prioritized the development of A2/AD capabilities. This strategy encompasses not only the nuclear sector but also strategic missile deterrence and non-conventional capabilities, including the subsurface domain.

Specifically, drawing from the operational lessons of the Tanker War and Operation Desert Storm, the Islamic Revolutionary Guard Corps Navy (IRGCN) assigns a pivotal role to naval mines for the strategic control of the Strait of Hormuz and the Persian Gulf. Sophisticated mining techniques result from exercises focused on pre-planned measures to blockade or interdict maritime traffic using indigenous and Russian-derived moored and bottom mines, as well as Chinese-manufactured self-propelled mines. While Iran’s primary maritime area of interest is the Strait of Hormuz, its regional interests are projected elsewhere via support for terrorist factions, such as the Houthi operations in the Red Sea.¹

Iran has developed a subsurface component based on small, heavily armed platforms capable of executing asymmetric and saturation tactics, which can be suitable for seabed warfare operations.

The underwater order of battle (ORBAT) includes three 1990s-era Kilo I class submarines, one Fateh class coastal submarine, and between 14 and 17 midget submarines (one Nahang class and approximately 16 North Korean/indigenous Ghadir class). These are augmented by locally produced Swimmer Delivery Vehicles (SDVs) of the Al-Sabehat and Ghavasi types for Special Operations Forces (SOF) tasks.^2,3 Recently, the inventory has expanded to include the Nazir-1 Extra Large Unmanned Underwater Vehicle (XLUUV) and weaponized UUVs (small-scale, long-range slow torpedoes).^4,5

While the opacity of the maritime environment provides opportunities for covert subsurface operations – ranging from SOF insertion to mine-laying via surface units and midget craft – the overall underwater component also appears to maintain credible anti-ship capabilities (ASuW).

Countering Asymmetric Threats

The IRGCN and the Islamic Republic of Iran Navy (IRIN, or NEDAJA) function as two distinct naval entities, operating across different geographical Areas of Interest (AOIs) and employing divergent tactical doctrines. The former, an integral branch of the Revolutionary Guard, holds primary responsibility for asymmetric defense within the Persian Gulf and the Strait of Hormuz. The latter is focused on the protection of long-range maritime interests, blue-water patrolling, and counter-piracy operations.

Given that the IRIN’s surface combatant capability was effectively neutralized following engagements with U.S. forces, Iran’s national defense now rests fundamentally upon coastal missile batteries and the IRGCN. Consequently, it is characterized by a pronounced asymmetric posture that currently maintains a degree of containment against American military superiority.

Naval Mines

Although it is estimated that only a limited number of devices have been deployed in Hormuz to date, Iran possesses a substantial inventory of underwater ordnance (ranging between 2,000 and 6,000 units), consisting of indigenous designs and Russian or Chinese-derived systems. Therefore, the mine threat in the Strait of Hormuz must be assessed as substantial. Furthermore, it cannot be ruled out that Iran might resort to protective mining of its territorial waters, utilizing influence mines such as the MAHAM 7 (a mine that strikingly similar to the Italian Manta) and MAHAM 5, as well as contact mines like the Sadaf 01 – specifically in the approaches to Kharg Island and Bandar Abbas – to deter amphibious landings.

Additionally, the IRGCN’s asymmetric doctrine suggests the potential for Special Forces/combat diver attacks against naval units in port or at anchor, utilizing MAHAM 4-type timed limpet mines.

Under these operational conditions, Counter-Mine (CM) strategies must be conducted through preliminary left-of-launch strikes against storage depots and minelaying platforms – a tactic employed by both the USN and the Russian Federation in the Ukrainian conflict – followed by MCM (Mine Countermeasures) operations against deployed ordnance. In this latter phase, while Unmanned Underwater Vehicles (UUVs) provide significant utility for Search, Detection, and Classification (SDC), international subject matter experts maintain that effective Mine Warfare (MW) still requires specialized platforms capable of operating in high-risk contested environments where minefield boundaries remain ill-defined. This requirement is underscored by the fact that, despite the loss of primary minelaying vessels to U.S. strikes, Iran retains the capacity to seed or refresh minefields using small, fast-attack craft or Craft of Opportunity (COOP) operated by the Pasdaran.

It is therefore critical that MCM vessels are either deployable alongside the main fleet or pre-positioned in contested chokepoints. Given the persistent asymmetric threat, traditional clearance operations should ideally be reserved for the post-conflict phase to reopen commercial Sea Lines of Communication (SLOCs). During active hostilities, UUVs should be utilized for contingency interventions or risk reduction within temporary break-in channels to facilitate power projection ashore, should conditions permit.

The Houthi movement also possesses a significant naval mine arsenal. However, due to bathymetric constraints, these are primarily deployable along the Yemeni littoral to counter Saudi Coalition forces, rather than for the strategic interdiction of the Bab El Mandeb – a task for which they employ other asymmetric vectors in synergy with Iran. 

In a broader sense, the deployment of naval mines generates a psychological impact that analysts have cogently summarized: “The mined area does not have to be everywhere, to be everywhere in the minds of those who must transit it…” implying that even a negligible number of mines can precipitate complex, high-intensity crisis scenarios.⁶

Unmanned Systems: The Proliferation of Multi-Domain Robotic Warfare

The proliferation of unmanned systems has cross-sectionally impacted all warfare domains – land, air, and sea. The operational effectiveness demonstrated by Ukrainian maritime drone strikes against Russian Federation naval units, both in ports of origin and on the high seas, serves as a definitive case study of the evolving nature of naval engagement.

In the underwater dimension, despite persistent challenges related to acoustic propagation for communications, unmanned platforms are driving significant shifts in tactical procedures and are increasingly integrated with traditional naval assets.

Beyond the extensive use of Unmanned Aerial Vehicles (UAVs) for ISR (Intelligence, Surveillance, and Reconnaissance) and risk-mitigation for personnel, these platforms are now being effectively deployed as offensive vectors. This is further evidenced by the emergence of Unmanned Combat Underwater Vehicles (UCUVs), reportedly integrated into the inventories of the Al-Qassam brigades and Houthi militants.

To counter aerial threats, Counter-Unmanned Aircraft Systems (C-UAS) have rapidly evolved ranging from soft kill solutions (electronic jamming, spoofing, and hijacking) to hard kill capabilities. These range from interceptor drones equipped with net-capture to High Energy Laser (HEL) systems, kinetic effectors, and High Power Microwave (HPM) systems. The latter utilize high-intensity electromagnetic pulses to irreparably damage a platform’s electronic circuitry, resulting in immediate loss of control and neutralization.

Furthermore, the implementation of Remote ID regulations in the civil sector provides a framework that may enhance military tracking and identification Friend-or-Foe (IFF) protocols.

Regarding underwater threats, electronic countermeasures such as the Mobile Jammer Target Emulator (MJTE) are under development to counter UCUV attacks, while several nations have initiated regulatory frameworks for the governance and management of underwater battlespace.

A critical requirement remains the enhancement of capabilities to counter swarms of low-cost unmanned vehicles operating in a coordinated manner, which can saturate or severely degrade traditional defensive layers. In this context, HPM systems – which require only electrical power and offer continuous duty cycles without cooling – induced downtime – appear to be the most viable long-term solution for swarm interdiction, where conventional kinetic or laser engagement is often too slow or cost-prohibitive.

Moreover, Chinese research suggests that even fiber-optic guided drones – which have proven resilient to traditional Electronic Warfare (EW) in the Ukrainian theater – would likely succumb to high-power microwave pulses.

Attacks on Critical Undersea Infrastructure (CUI)

Strategic submarine fiber-optic cables traverse both the Strait of Hormuz and the Bab El Mandeb, where they are highly vulnerable to proxy-led interdiction – either via the accidental dragging of anchors by seemingly innocuous vessels or through deliberate underwater sabotage, similar to the Nord Stream gas pipeline kinetic strikes in the Baltic Sea.

This evolving threat landscape is driving the emergence of a new operational doctrine known as Seabed Warfare, central to this doctrine is the persistent maintenance of Seabed-to-Space Situational Awareness (S3A). This framework is designed to detect anomalous behavior, triggering subsequent inspection and exploration of the seabed where Critical Undersea Infrastructure (CUI) is located, primarily through the deployment of UUVs to mitigate threats or assess damage.

This new warfare paradigm requires the seamless integration of all assets operating within the underwater battlespace, traditionally involving Anti-Submarine Warfare (ASW), MW, and diving operations.

However, deploying unmanned systems in the subsurface dimension entails greater technical challenges than surface operations, primarily due to acoustic propagation constraints which limit communication bandwidth and range. This has spurred intensive Research and Development (R&D) efforts, often in synergy with civilian research centers, to enhance the mission endurance and operational autonomy of underwater drones across vast CUI networks.

Consequently, it is crucial to consolidate capabilities in automated underwater docking stations (for power recharging and mission data transfer), underwater mesh networks (Internet of Underwater Things – IoUT), and Machine Learning (ML) algorithms. By providing unmanned platforms with increased autonomous decision-making capacity, these technologies compensate for the inherent sub-surface communication latency.

Simultaneously, seafloor sensor arrays and the dual-use of fiber-optic cables via Distributed Acoustic Sensing (DAS) technology are becoming essential for the detection and tracking of sub-surface threat vectors.

In summary, while there is an urgent requirement to counter threats that interdict commercial transit through maritime chokepoints and disrupt hydrocarbon flows, there is an equally pressing need to protect both the sub-sea cables – which serve as the backbone of global economic interconnectivity –and the physical sub-surface infrastructure for energy transfer, such as gas and oil pipelines.

Conclusion

As noted by prominent geopolitical analysts Dario Fabbri, the geostrategic postulate remains more valid than ever:

“He who commands the sea possesses a distinct advantage, both offensively and defensively. He commands communication lines that require neither creation nor maintenance, can evade inland-originated aggression, establish the primary defensive perimeter within the depths, deprive adversaries of logistics, and lead the international system by regulating the flow of global commerce.”⁷

Contemporary maritime dominance mandates that great powers exercise effective thalassocracy: controlling strategic chokepoints, ensuring Freedom of Navigation (FONOPs), and maintaining indispensability to allied networks. For the United States, restoring secure transit through the Strait of Hormuz is not merely an energy security concern, but a strategic imperative to maintain hegemony over global markets before the rapidly expanding People’s Liberation Army Navy (PLAN) occupies the resulting power vacuums. While great powers pursue these objectives through complex and diversified carrier strike groups and fleet architectures, regional actors such as Iran pursue them via asymmetric warfare. This demonstrates that the technological gap can be mitigated through the integrated employment of naval mines, unmanned systems, coastal defense missiles, and FIAC (Fast Inshore Attack Craft) swarms.

In this landscape, the persistent availability of ISR-T (Intelligence, Surveillance, Reconnaissance, and Targeting) capabilities – encapsulated in the S3A framework – and the rigorous monitoring of pattern of life” constitute the essential prerequisites for modern maritime operations. The Hormuz theater has specifically underscored the necessity for robust MCM capabilities capable of executing the full MCM kill chain – detect, classify, identify, and neutralize – integrated with sub-surface surveillance arrays and fiber-optic technologies such as Distributed Acoustic Sensing (DAS). The multi-layered threat environment – comprising mines, missiles, UAVs/USVs, and fast-attack craft – demands a sophisticated multi-threat response capability and increasingly seamless interoperability with the civilian infrastructures managing sub-sea communications.

The prevailing trend toward casualty cross-reduction is accelerating the deployment of robotic and autonomous systems (RAS). The operational success already demonstrated by surface and underwater drones across multiple conflict theaters provides an unequivocal signal regarding the future trajectory of naval combat. However, overly ambitious transitions from conventional to fully autonomous architectures may prove counterproductive: unmanned systems possess tangible vulnerabilities – such as entanglement nets, floating cables, and physical hostile seizure – and face significant operational constraints in harsh sea state conditions. Consequently, a phased approach to remote integration is required, validated through realistic operational exercises such as those conducted by NATO, which embed military subject matter experts alongside industrial technicians in high-fidelity field conditions.

The consolidation of emerging and disruptive technologies – artificial intelligence, big data analytics, and quantum computing – will finalize this transformation, enabling levels of automation capable of autonomously managing system responses and asset coordination. This process necessitates a parallel evolution of international law – ranging from UNCLOS to international humanitarian law – to define the legal status of unmanned platforms and address the inevitable ethical dilemmas posed by lethal autonomous weapons systems capable of kinetic engagement without direct human intervention.

Massimo Vianello is a retired Italian Navy Admiral who graduated from the Italian Naval Academy. Specializing in underwater weaponry and Mine Countermeasures (MCM), he has commanded coastal minehunters, a frigate, and the sailing vessel Amerigo Vespucci. His extensive operational experience spans critical theaters, from the First Persian Gulf War and Operation Allied Force to Operation Mare Nostrum. As a former Commander of both the Mine Countermeasures Forces and the 29th Naval Task Group, Admiral Vianello now leverages his expertise as an Analyst for the Center for Geopolitical and Strategic Maritime Studies (CESMAR), where he serves as a leading subject matter expert on sub-surface warfare and undersea security.

Giovanni Giorguli is a retired Italian Navy Master Chief Petty Officer and an Autonomous Underwater Vehicles (AUVs) pioneer with almost 40 years of expertise in Mine Countermeasures and underwater technology. He is a veteran of international operations such as those in the Persian Gulf, Operation Allied Force, various NATO missions, and the 2022 FIFA World Cup security framework in Qatar. Throughout his career, he served as a key instructor and searider, shaping Italy’s national underwater tactics and doctrine. A Knight of the Order of Merit of the Italian Republic, he has authored and contributed to publications on Seabed Warfare and subsea infrastructure protection. He is currently an analyst at the Center for Geopolitical and Strategic Maritime Studies (CESMAR).

The opinions expressed are those of the authors and do not reflect the views or policy of any organization with which they are affiliated. No organizational endorsement is implied or intended.

References

1. Various Authors, “Visione Strategica dell’Underwater warfare”, Rome, Italian Navy General Staff, 2019. https://www.aljazeera.com/economy/2026/4/13/what-do-we-know-about-sea-mines-in-and-around-the-strait-of-hormuz.

2. H I Sutton, “Iranian submarine forces”, Covert Shores, 16 May 2019.

3. H I Sutton, “Demystified new low profile Iranian SDV”, Covert Shores, 10 May 2015.

4. H I Sutton, “Iranian Nazir-1 XLUUV submarine drone”, Covert Shores, 11 July 2020.

5. H I Sutton, “New Iranian weaponized underwater drone”, Covert Shores, 16 March 2022.

6. Mohammad Mansour, “What do we know about sea mines in and around the Strait of Hormuz?”, Al Jazeera, 13 April 2026,  https://www.aljazeera.com/economy/2026/4/13/what-do-we-know-about-sea-mines-in-and-around-the-strait-of-hormuz.

7. Dario Fabbri, “Geopolitica umana”, Milan, Edizioni Gribaudo, 2024. 

Featured image: An IRGCN fast patrol boat with naval mines. (Courtesy of Tasnim News Agency)

Iran War Topic Week

By James Jackson

Operation Epic Fury began on February 28, 2026, with objectives unrelated to commercial shipping: destroy Iran’s ballistic missiles and their manufacturing plants, destroy its navy, sever its proxies, and foreclose a nuclear weapon. The strait was open when the bombs fell. On March 4, Iran closed the strait in response to the strikes. What had been a campaign against Iranian military power became, by consequence, a campaign to reopen a waterway the United States had helped shut. Three months later, the strait is still closed, though not due to any failure of skill at sea. Aegis-equipped American ships have compiled a near-perfect intercept record against Iranian coastal cruise missiles, drones, and small-boat swarms. Iranian launch sites, radars, and command nodes are being struck on schedule. Yet the Iranian Revolutionary Guard Corps’ irregular forces – mobile anti-ship missiles, drones, and fast-boat flotillas dispersed along the coast – remain largely intact. The strait is still (at the time of this writing) in dispute.

Iran now runs a permission regime, issuing IRGC transit clearances and waving favored flags through. Under Project Freedom, U.S. escorts briefly pushed individual hulls through the Omani waters along the strait’s southern side, but this effort was terminated in early May. Three months into the campaign, ordinary commercial transit has collapsed to under a tenth of its pre-conflict volume and stayed there.¹ Tankers and boxships are still routing around the Cape of Good Hope, war-risk premiums for Western-linked hulls remain prohibitive, and the flow of commerce the United States went to war to restore has not returned. No amount of additional tactical excellence is bringing it back.

Whether the United States was wise to start this war is a separate question, and not the one this essay addresses. The strikes on Iran were in theory a choice to move from one state of affairs to a better one. They produced the opposite. The strait was open when the campaign began; Iran closed it in response to the strikes, and the commerce the United States sought to protect collapsed. But the war was fought, and fighting it taught what the decision (and strategy) missed. One can think the war a mistake and still find the analysis useful.

Destroying Iranian launchers was never going to reopen the strait, no matter how many the Navy hits.  Whether the strait stays closed gets decided each morning in the war-risk syndicates of London and the risk committees of the world’s shipping lines, in numbers no destroyer can reach. They hold a veto no warship can override. The Navy does not choose this fight or set its aim; it executes the policy it is handed. So the burden falls where Clausewitz put it: on the policymakers and the President who set the war’s objective. Until they accept that reopening the strait is an economic and political act rather than a targeting problem, the Navy can win every tactical engagement while the nation will remain on track to lose the war.  

What Is Actually Being Contested

Planning to win wars must begin with the aim in mind. The United States is not trying to sink the Iranian navy. Rather, it is trying to reestablish the flow of seaborne commerce. That aim defines the object of the contest, and the object is not the water. A strait is closed not when ships cannot pass but when the people who own the cargo and insure the hull decide the cost of passing exceeds the cost of going around. That decision is a financial calculation, and it forms the decisive point of a chokepoint war. Whoever controls the calculation controls the strait.

For Alfred Thayer Mahan and Julian Corbett, the most prominent theorists of modern sea power, command of the sea was a physical condition: the ability to use the sea and deny its use to the enemy. In today’s global economy, where moving goods depends as much on insurance, credit, and confidence as on hulls and engines, that condition is necessary but no longer enough. A destroyer can shield a ship, but it cannot lower that ship’s insurance bill or convince an owner that next week’s voyage will be uneventful. Command of the sea has slipped from the gun line to the insurance ledger, and the Navy did not move with it. Sea control has become an actuarial condition: whether the strait can be used is decided by the price underwriters put on the risk of crossing it – the same arithmetic an actuary applies to any hazard – not by which navy wins the day’s engagement.

The number that decides a chokepoint is the war-risk premium: the surcharge a hull pays to sail through a war zone. It tracks the persistence of a threat, not the odds that any given attack is intercepted. An underwriter is indifferent to the ninety-nine missiles that were stopped. They price the hundredth, the catastrophic loss that bankrupts the voyage, and the standing chance that it recurs tomorrow. A single ship lost undoes the record of a thousand intercepts.

The Red Sea already showed this. From January 2024, U.S. and coalition warships ran the same high-intercept campaign against the Houthis that is now underway against Iran, and ran it well. Yet container traffic through the Suez Canal fell roughly seventy-five percent and stayed down from 2024 onward through the present, with no recovery even during lulls in Houthi activity.² Carriers kept routing the long way around Africa, adding some 4,000 miles and ten to fourteen days per voyage and absorbing a roughly nine-percent cut in effective global shipping capacity, because the market was not pricing the kill ratio.³ It was pricing the chance that one drone would get through and the certainty that the threat had no announced end. The shooting was excellent. Yet the strait stayed shut.

Hormuz will reproduce this at greater intensity: a narrower, mineable waterway overlooked by mobile coastal missiles along the whole Iranian littoral, carrying roughly a fifth of the world’s oil.⁴ The premium will not fall simply because Iranian launchers are destroyed. It will fall only when the market believes the threat has durably ended, and belief in an ending is exactly what an open-ended bombing campaign cannot supply.

The Asymmetry of Doubt

The cost-per-intercept problem is by now well documented: multimillion-dollar SM-2 and SM-6 interceptors spent on twenty-thousand-dollar drones, nearly a billion dollars in such rounds burned in the Red Sea alone, and a vertical-launch magazine drawn down faster than industry can replace it, consuming the very interceptors the fleet needs for the Pacific.⁵ The Vice Chief of Naval Operations has said plainly that a protracted fight will demand more magazine depth than the force possesses.⁶

But munitions are the lesser asymmetry. The greater one is doubt. The attacker’s product is uncertainty, which is cheap, requires no successful hit, and can be sustained indefinitely from a cave with a launch rail. The defender’s product is confidence, which cannot be manufactured at all. Confidence is earned slowly and lost instantly. You cannot prove a negative to an underwriter. Premiums rise in an afternoon and fall over quarters, because the market has a long memory for danger and a short one for safety. The defender is buying a perishable good with a currency the adversary can debase at will.

None of this leaves the defender powerless. It means the defender’s familiar tools such as more intercepts and strikes are the wrong ones. The moves that actually lower the price of risk lie outside the peacetime paradigm, and a state willing to use them has them: it can shoulder the risk itself through a government guarantee or turn the same economic weapon back on Tehran by choking the oil exports that fund the war. The defender has options. Firepower aimed at launchers just isn’t one of them.

Here the kinetic campaign becomes counterproductive.  The fighting created the war zone, and the strikes cannot clear it. Their visible open-endedness sustains the one signal the underwriter cares about.  To a risk committee, an ongoing high-intensity bombing campaign is evidence the danger is still live enough to require bombing. The campaign meant to reopen the strait reads, to the people who decide whether it is open, as a daily bulletin that it remains a war zone.

The Stand-In Force, Turned Around

The Marine Corps will recognize what Iran is doing, because Iran is running the Marine Corps’ own playbook. Low-signature, mobile, lethal, and cheap, operating from inside the contested zone to deny freedom of maneuver: this is the Stand-in Forces concept made manifest, except that the stand-in force is Iranian and the maneuver denied is American.⁷ Coastal launchers and drones have held multi-billion-dollar capital ships at arm’s length and pushed carrier strike groups into recessed defensive boxes, just as the Houthis forced U.S. carriers out of the Bab el-Mandeb and sent the George H.W. Bush carrier strike group the long way around Africa.⁸

The instinct is to treat this as a targeting problem and answer it with better sensors and more interceptors. That misreads the lesson. What a stand-in force generates is doubt, the steady pressure it keeps on an adversary’s economic lifelines. The IRGC Navy has sunk little and priced a great deal. That should change how the Marine Corps measures and resources the concept. A force designed to destroy enemy hardware fights where the United States is wealthiest and most vulnerable to cost-imposition; redesign it to manufacture uncertainty in an adversary’s commercial flows and it fights where great powers are thinnest-skinned and least able to hit back. The right yardstick is cost and uncertainty imposed per dollar spent, and by that measure Iran is winning at a rate no munitions budget can match.

The Free-Rider Tell

The clearest proof that the contested good is confidence rather than control is sitting in the strait right now, transiting unmolested. Chinese-flagged and Russian-flagged vessels move through it under bilateral understandings with Tehran, using the friction the U.S. Navy generates as a shield for their own commerce.

This would be impossible if the good in dispute were physical control of water, which is indivisible. You cannot grant one ship partial control of a strait. But you can grant selective confidence, a promise not to target a particular flag, because confidence is divisible and assignable. That safe passage can be parceled out flag by flag shows what Tehran actually commands: the risk of passage. It is in the indemnity business, not the sea-lane business. The United States, sustaining a high-risk environment from which it has exempted its two principal competitors, is paying the full premium to buy Beijing and Moscow a discount.

1987: The Flag, Not the Gun

None of this is unprecedented. The United States solved the same problem in these waters thirty-nine years ago. During the Tanker War, Iran imposed doubt on Gulf shipping with mines and IRGC small boats, the 1980s edition of today’s drones and coastal missiles, and Kuwait’s tankers became uninsurable in practice. What reopened commerce was not the destruction of Iran’s navy. The largest kinetic action, Operation Praying Mantis, lasted a day and came late.⁹ It was Operation Earnest Will, and at its core Earnest Will was a flag, not a gun. By reflagging eleven Kuwaiti tankers as American, the United States moved the risk of those hulls onto the U.S. government and its implicit guarantee, collapsing the war-risk burden that had priced them off the water.¹⁰ The escort made the guarantee credible. What the cargo owners paid for was the promise behind it.

Two further features of 1987 matter for 2026. The commitment was tied to a war-termination framework, UN Security Council Resolution 598, so the market could see an ending rather than an open-ended campaign. And it was bounded precisely because it was a guarantee rather than a war. Critics attacked it as an open-ended commitment, which forced it to define its limits.¹¹ The decisive maritime weapon of the Tanker War was a credible, bounded, state-backed promise. The Navy made the promise believable. It did not make the promise, and no amount of bombing could have.

Redesigning the Campaign Around the Premium

If sea control is an actuarial condition, the campaign must drive down the price of risk directly rather than chase the launchers that are only its distant cause. Four moves follow.

First, re-create the guarantee. Let Washington itself cover the war risk that private insurers now refuse. The same thing occurred in 1987 when it put the American flag on Kuwaiti tankers, except today the tool is the U.S. Treasury’s guarantee rather than the flag. This is the single most powerful move available, and the one thing the Navy can support but cannot do on its own. Driving down the price of passage is the goal. Every strike exists only to make that guarantee believable.

Second, sell predictability, because predictability is what the market prices. A scheduled, published, escorted transit window, a convoy that reliably sails Tuesday, is worth more to an underwriter than an unannounced ninety-nine-percent intercept rate, because it converts an open-ended threat into a bounded and plannable one. What the market is buying is a schedule it can plan around.

Third, set a military goal the Navy can actually reach. Wiping out Iran’s coastal forces is not it. They are cheap, scattered, and replaced faster than the Navy can replace the missiles it spends shooting them down. But making it unlikely enough that any single attacker gets through, unlikely enough for an insurer to live with, is reachable. Pursue it with layered, cost-sustainable defenses, including the directed-energy systems the Navy is now fielding, and the fleet stops burning through magazines better preserved for a Pacific fight on an Middle Eastern attrition contest it is positioned to lose.¹²

Fourth, signal the ending. Because the price of risk depends on how open-ended the danger looks, a credible, stated path to ending the war is itself a force that brings that price down. Escalating does the opposite: it stretches out the very uncertainty the campaign seeks to end. A limited objective is not restraint for its own sake. Rather, it is a way to move the market. All of this means keeping a different scoreboard. In a chokepoint like this one, the numbers that matter are the price of insuring a voyage and the count of ships actually sailing . Those two figures tell you who holds the strait today, the way a fleet on station and an enemy kept away once did. They are the numbers this campaign is not moving.

Misassigned, Not Defeated

The Navy’s problem in the Strait of Hormuz is that it has been handed the wrong job. It is winning, with discipline and skill, every kinetic engagement in which it participates. But the war’s objectives cannot be achieved by destroying targets and killing the enemy. The war is over the price of doubt, and doubt cannot be killed. The strait will reopen when the underwriter’s veto is lifted, and lifting it is an economic and political act: a credible guarantee, a predictable corridor, and a visible ending. With the approach laid out above, the Navy can make that act credible. But it cannot bombard credibility it into being.

The warning runs past Iran and past the merits of this particular war. Consider what this war has shown. A regional power armed with cheap drones, mobile launchers, and the patience to keep the outcome in doubt has held a global chokepoint closed against the world’s premier fleet, and sold safe passage through it to that fleet’s competitors while doing so. Whether the U.S. Navy can still secure the sea lanes it exists to protect was answered once in the Red Sea, and is being answered again off Hormuz. That lesson holds whatever one thinks of the decision to intervene. The instrument that secures the modern chokepoint is the credible guarantee, and the metric that scores it is the premium. A nation that grasps this can choose its chokepoint fights on terms it can win or decline them, clear-eyed about what victory would cost. A force that keeps counting intercepts will do neither: it will go on winning every engagement and losing every strait.

LtCol James Jackson is a career logistician in the U.S. Marines, and an operational and strategic planner currently assigned to US Cyber Command. He is a graduate of the Maritime Advanced Warfighting School at the U.S. Naval War College.

Endnotes

1. As of late May 2026, roughly day 89 of the campaign, commercial transit through the strait had collapsed to under ten percent of the pre-conflict baseline and had not normalized. Iran shifted in April from continuous closure to a permission-based regime, issuing IRGC transit clearances while continuing to fire on shipping; the tanker SANMAR HERALD was attacked on April 18 despite holding a valid clearance. See Windward, “Three Months Into Operation Epic Fury: How Iran Restructured Hormuz Instead of Closing It” (May 27, 2026); USNI News, “Strait of Hormuz Commercial Transits at Lowest Level Since Operation Epic Fury Start” (May 1, 2026), citing Lloyd’s List; and GlobalSecurity.org, “Project Freedom: Strait of Hormuz, May 2026.” A roughly 70 percent drop reported by the Council on Foreign Relations and the Congressional Research Service reflects the opening weeks of the campaign rather than the sustained collapse measured three months in.

2. Container-vessel transits through the Suez Canal fell roughly 75 percent in 2024 against 2023 and had not recovered through mid-2025, persisting even through pauses in Houthi activity. See project44, “The Red Sea Crisis: Ceasefire Collapse Leaves Red Sea in Tumultuous State” (Aug. 21, 2025); and Coface, “Houthi Attacks in the Red Sea: Why Maritime Trade Is Still Not Smooth Sailing” (Dec. 29, 2025), which records container flows through Suez down by roughly 90 percent at the trough.

3. The Cape of Good Hope diversion adds approximately 4,000 nautical miles and 10–14 days to an Asia–Europe voyage. J.P. Morgan estimated the rerouting amounted to roughly a 30 percent increase in transit times and an approximately 9 percent reduction in effective global container shipping capacity. See J.P. Morgan Research, “The Impacts of the Red Sea Shipping Crisis”; and World Atlas, “How the Red Sea Shipping Crisis Affects Global Trade” (Apr. 2026).

4. On the share of seaborne oil transiting Hormuz and the waterway’s chokepoint geometry, see U.S. Energy Information Administration data as summarized in the CIMSEC call and contemporary reporting on Operation Epic Fury; for the operational character of the 2026 conflict, see Defense.info, “From Red Sea Defense to Epic Fury: How the U.S. Flipped the Drone Cost Equation” (Mar. 13, 2026).

5. On interceptor unit costs and the cost-exchange asymmetry, see Khyati Singh, “Navies Can’t Afford Expensive Solutions to Cheap Problems,” The Strategist / ASPI (Oct. 21, 2025); CSIS, “Cost and Value in Air and Missile Defense Intercepts” (Oct. 11, 2024); and “The Hidden Cost of a Missile: Why the Headlines Get Cost Wrong,” War on the Rocks (Nov. 18, 2025), which estimates roughly $1 billion in munitions expended defending Red Sea shipping since late 2023.

6. Adm. James Kilby, then acting Chief of Naval Operations, on the need for greater magazine depth in a protracted conflict, as reported in Fox News, “Navy’s Kilby on Houthi Missiles and Red Sea Costs” (2025).

7. Headquarters Marine Corps, A Concept for Stand-in Forces, (Washington, D.C.: Headquarters Marine Corps, 2021), 4.

8. On the deterrence of U.S. carrier strike groups from the Bab el-Mandeb and the resulting circuitous routing, see the CIMSEC call for articles, “War with Iran” (2026); and reporting on carrier strike group dispositions during the Red Sea campaign.

9. Operation Praying Mantis (Apr. 18, 1988) was a single-day action launched after USS Samuel B. Roberts struck an Iranian mine. See “Operation Praying Mantis,” and David B. Crist, “Joint Special Operations in Support of Earnest Will,” Joint Force Quarterly (Autumn/Winter 2001–02).

10. On the reflagging of eleven Kuwaiti tankers as U.S.-flagged vessels and the transfer of risk to the U.S. government, see “Operation Earnest Will”; Richard A. Mobley, “Intelligence Support During Operation Earnest Will, 1987–88,” Central Intelligence Agency; and Veterans Breakfast Club, “Before Today’s War with Iran, There Was the Tanker War” (Mar. 16, 2026).

11. On UNSCR 598 as a termination framework and the domestic controversy over the open-ended nature of the commitment, see “Renewed Tensions in the Persian Gulf: Further War Powers Lessons from the Tanker War,” Just Security (2023).

12. On the Navy’s pivot toward directed-energy defenses (e.g., HELIOS aboard USS Preble) as a response to the cost-exchange and magazine-depth problems, see “How to Save the U.S. Navy from Becoming a Bunch of Old ‘Battleships,'” 19FortyFive (Feb. 14, 2026).

Works Cited

Coface. “Houthi Attacks in the Red Sea: Why Maritime Trade Is Still Not Smooth Sailing.” December 29, 2025. https://www.coface.com/news-economy-and-insights/houthi-attacks-in-the-red-sea-why-maritime-trade-is-still-not-smooth-sailing

Crist, David B. “Joint Special Operations in Support of Earnest Will.” Joint Force Quarterly, Autumn/Winter 2001–02. https://apps.dtic.mil/sti/tr/pdf/ADA403506.pdf

Center for International Maritime Security. “Call for Articles: War with Iran.” 2026. https://cimsec.org/call-for-articles-war-with-iran/

Center for Strategic and International Studies. “Cost and Value in Air and Missile Defense Intercepts.” October 11, 2024. https://www.csis.org/analysis/cost-and-value-air-and-missile-defense-intercepts

Congressional Research Service. “Iran Conflict and the Strait of Hormuz: Impacts on Oil, Gas, and Other Commodities.” March 11, 2026. https://www.congress.gov/crs-product/R45281

Council on Foreign Relations. “The Strait of Hormuz: A U.S.-Iran Maritime Flash Point.” 2026. https://www.cfr.org/articles/strait-hormuz-us-iran-maritime-flash-point

Defense.info. “From Red Sea Defense to Epic Fury: How the U.S. Flipped the Drone Cost Equation.” March 13, 2026. https://defense.info/featured-story/2026/03/from-red-sea-defense-to-epic-fury-how-the-u-s-flipped-the-drone-cost-equation/

GlobalSecurity.org. “Project Freedom: Strait of Hormuz, May 2026.” https://www.globalsecurity.org/military/ops/project-freedom.htm

J.P. Morgan Research. “The Impacts of the Red Sea Shipping Crisis.” https://www.jpmorgan.com/insights/global-research/supply-chain/red-sea-shipping

Just Security. “Renewed Tensions in the Persian Gulf: Further War Powers Lessons from the Tanker War.” 2023. https://www.justsecurity.org/87650/renewed-tensions-in-the-persian-gulf-further-war-powers-lessons-from-the-tanker-war/

Mobley, Richard A. “Intelligence Support During Operation Earnest Will, 1987–88.” Central Intelligence Agency. https://www.cia.gov/resources/csi/static/Fighting-Iran.pdf

19FortyFive. “How to Save the U.S. Navy from Becoming a Bunch of Old ‘Battleships.'” February 14, 2026. https://www.19fortyfive.com/2026/02/how-to-save-the-u-s-navy-from-becoming-a-bunch-of-old-battleships/

project44. “The Red Sea Crisis: Ceasefire Collapse Leaves Red Sea in Tumultuous State.” August 21, 2025. https://www.project44.com/supply-chain-insights/the-red-sea-crisis-ceasefire-collapse-leaves-red-sea-in-tumultuous-state/

Singh, Khyati. “Navies Can’t Afford Expensive Solutions to Cheap Problems.” The Strategist (Australian Strategic Policy Institute), October 21, 2025. https://www.aspistrategist.org.au/navies-cant-afford-expensive-solutions-to-cheap-problems/

Featured Image: The Thailand-flagged cargo ship Mayuree Naree engulfed in black smoke in the Strait of Hormuz. (Royal Thai Navy photo)