Strait of Hormuz: The Perilous Gamble in America's Iran Reckoning

By Victoria Chen-Hartwell | Circus of Power | March 18, 2026

The Strait of Hormuz, that narrow ribbon of water between Iran and Oman, has long been a choke point in global geopolitics—a 21-mile-wide artery through which 20% of the world's oil supply flows daily. Today, as Iranian threats to mine and blockade the strait intensify amid a spiraling US-Iran conflict, we confront not just a regional flashpoint but a profound test of the liberal international order. President Trump's "Operation Epic Fury" strikes have killed Iranian leaders and provoked retaliatory IRGC attacks on US bases, resulting in the deaths of six American airmen whose dignified transfer ceremony he attended this morning. Oil prices surged 15% to $95 a barrel, per Yahoo Finance, injecting volatility into markets already strained by trade disruptions and inflationary pressures. The Federal Reserve now projects end-2026 inflation at 2.7%, up from December estimates, with just one rate cut on the horizon—blame the war-fueled energy costs.

This escalation is no isolated skirmish; it risks unraveling the alliances, trade flows, and institutional norms that underpin global stability. As a former State Department official who navigated the intricacies of Middle East diplomacy under both Republican and Democratic administrations, I have seen how such crises can cascade. The 1979 Iranian Revolution and subsequent oil embargo plunged the world into recession; today's multipolar landscape, with China's rising influence and Europe's energy vulnerabilities, amplifies the stakes. Trump's rhetoric—"We will finish this!" as he declared on Fox News in a clip viewed 69,000 times—may rally his base, but it sidesteps the diplomatic scaffolding needed to prevent a broader conflagration. The international community, from the European Central Bank warning of underpriced geopolitical risks to China's pragmatic rebuff of US pleas for assistance in securing oil and Qatari LNG passages, is signaling unease. If mishandled, this could erode US credibility, spike global energy prices, and accelerate the de-globalization trends that threaten incremental reform and free trade.

Consider the immediate military and economic dimensions. Intelligence assessments from the Director of National Intelligence (not Tulsi Gabbard), once a vocal critic of endless wars, now portray Iran leveraging the strait as a "red line" in negotiations stalled since the US withdrawal from the JCPOA in 2018. Israeli strikes have eliminated key IRGC figures, but Iran's asymmetric responses—drone swarms on US assets and threats to close the strait—echo the 2019 tanker attacks that briefly disrupted shipping. Geopolitical Futures, a nonpartisan analysis firm, warns in a recent memo that this evokes the prelude to a "Gulf War III," where US drone operations could draw in reluctant allies. Trump is mulling a withdrawal of US forces from Hormuz patrols, shifting the burden to partners like the UK and France, while delaying his Beijing summit. Spain's denial of base access prompted Trump's tweet: "Allies like Spain say no to bases? Fine, we don't need permission." Such isolationism, while politically potent among his MAGA supporters—where a CNN poll shows 100% approval for military action—undermines the burden-sharing that has sustained post-World War II alliances.

From my vantage, having split time between Georgetown's policy salons and Palo Alto's tech corridors, this moment underscores a deeper pathology: populism as a symptom of policy failure. The Trump administration's gut-driven strikes, bypassing multilateral forums like the UN Security Council, reflect not bold leadership but a retreat from the rules-based order I have long championed. Historical parallels abound. The 1953 CIA-orchestrated coup in Iran sowed seeds of resentment that flowered into the 1979 hostage crisis; unilateralism then, as now, invited blowback. Internationally, compare this to Europe's handling of the 2022 Ukraine energy crisis: While the EU diversified supplies through Norwegian gas and LNG terminals, Iran's strait threats could force a similar scramble, delaying the green transition. The ECB's projection of higher market volatility isn't hyperbole; with renewables stalled by high fossil fuel costs, the path to net-zero grows steeper. As MIT's Nicholas Burns, a former ambassador and fellow institutionalist, urges, even amid tensions, climate-diplomacy engagement with China remains essential—yet Trump's delay on Beijing risks ceding that ground.

Critics, including Democrats and international observers, rightly decry the recklessness. PBS reports highlight how Trump "side-stepped diplomacy" for escalatory measures, while Senator Rand Paul, in a related hearing on political violence, questioned whether force can truly resolve differences—a nod to the broader erosion of norms. On X, trends like #HormuzCrisis amplify the divide: Pro-Trump accounts like @LeadingReport garner 11,000 likes for praising "America First" pullouts, while @ProudSocialist labels Gabbard a "betrayer" for her pivot from 2020 anti-war stances to justifying action today (867 likes). Globally, Norway's prime minister faced Trump's mockery, and V-Dem Institute's fresh report ties this to America's slide toward "electoral autocracy," with executive overreach mirroring Hungary's illiberal drift. Yet dismissing these as "fake news," as the MAGA echo chamber does, ignores the data: The institute's US score has plummeted, signaling rapid autocratization that weakens our leverage abroad.

Economically, the fallout is already materializing. The US-Mexico-Canada Agreement talks, which kicked off today, grapple with tariffs amid this chaos—Mexico proposing steel tariff eliminations to stabilize supply chains, per USTR releases. But Trump's 2026 Trade Policy Agenda, emphasizing deficits and a "fortress America," compounds the volatility. A court ruling invalidating a year of tariffs could trigger $175 billion in refunds, per Reuters, yet war-driven oil spikes threaten to inflate costs across sectors. For the Davos crowd—investors and policymakers attuned to Hennessy Funds' advice to "adjust" portfolios—this is a stress test for globalization. Free trade, which I advocate as the engine of prosperity, falters when chokepoints like Hormuz become weapons. Immigration intersects here too: High-skilled visas, vital for Silicon Valley's innovation in energy tech, face backlogs surging under DHS scrutiny, as noted in today's confirmation hearing for Secretary nominee (not Markwayne Mullin, who is a U.S. Senator). Tightening borders amid global instability risks brain drain, eroding the talent inflows that bolster US competitiveness.

Acknowledging complexity is key; Iran is no monolith, its regime propped by hardliners even as moderates seek engagement. Populism thrives on such failures—working-class anxieties over energy bills, fueled by policy neglect, not inherent philosophy. Trump's 90% base support for action stems from perceived bullies unchecked, but it masks deeper grievances: Stagnant wages, supply chain fragility from de-globalization. As someone who's seen the sausage-making in Foggy Bottom, I believe the system works when administered properly—incremental reform over bombast.

Pragmatic solutions exist. First, revive multilateral Hormuz patrols under a UN or IMO framework, drawing in China for safe passage assurances—Beijing's talks with Tehran show pragmatism trumps ideology. Second, pair military deterrence with diplomacy: Offer Iran calibrated incentives, like sanctions relief tied to verifiable de-escalation, echoing the JCPOA's architecture. Third, bolster alliances: Engage the Quad and EU on energy security, preventing a transatlantic rift. Domestically, Congress should condition funding on diplomatic benchmarks, safeguarding institutions against executive whims. The balanced budget amendment voted today in the House, while fiscally sound, must not shortchange these efforts.

In the end, this Iran crisis is a mirror to America's soul. Will we reclaim the liberal international order through expertise and process, or yield to isolationist impulses? The strait is narrow; the path forward demands steady hands, not fiery tweets. For global markets, democratic norms, and the incremental progress I hold dear, the choice is urgent.

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Victoria Chen-Hartwell is a former State Department official and senior fellow at the Brookings Institution, writing on international order and democratic institutions.

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