[The Long Game Brief] What’s the Status on Strait of Hormuz Shipping?

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It doesn’t sound good at this point in time. Both the U.S. and Iranian governments are throwing words or war around in their respective media spaces. Ships were already fired on by the Iranian military in the Strait of Hormuz over the weekend, which reinforced Iran’s renewed aggressive posture following the breakdown of the U.S.-Iran MoU signed in June.

In his story about the economic risks for the both the U.S. and the rest of the world, David Reavill uploaded some of the photos from the worldwide web to underscore **the tense situation in the Strait of Hormuz**.

David also bluntly illustrated the aftermath of this destruction:

“Apparently, ending the brief halt in the kinetic conflict. It’s an unfortunate turn of events that will inevitably result in further killing and destruction. Much will be reported on the specific destruction of military bases and civilian infrastructure. US Central Command has already begun announcing the specific targets it has ordered destroyed.”

So here we are again, back to more maritime shipping disasters in the Strait of Hormuz, unless this time more missiles will be fired at land-based targets of Iran, and putting more emphasis on the fighting between Iran and other U.S. military assets throughout the Persian Gulf region. One thing is clear, all of the Persian Gulf countries will not surrender to Iran, and they are definitely in the cross-fire — literally!

David explained the topic of the Petrodollar in his story, and why Saudi Arabia has taken a different direction than what the Trump Administration had hoped during this war with Iran:

“The world began to see a schism between the US and its chief Middle East ally, Saudi Arabia, in May 2026. It was then that the Saudis denied the US forces access to the Prince Sultan Airbase in its attacks on Iran. President Trump had launched ‘Operation Freedom’ in his continuing battle with Iran.”

I responded to his comments about the Petrodollar. I said:

“I don’t think Saudi Arabia will allow China or any other country to dictate terms in OPEC. In the end, all of the OPEC countries prefer the US Dollar to any other currency. So this obvious brings to mind other financial assets other than currencies, like gold. If OPEC and OPEC+ start buying and selling gold, then we could refresh the conversation about the decline of the US’s influence via Petrodollar.”

On the points about global crude oil markets, it is should be noted that oil prices have already declined significantly since the U.S.-Iran MOU was signed last month.

At the time of this publication, oil prices have been rising on the news:

UK Brent Crude Oil Price Chart from 8–13 July 2026

Crude oil prices haven’t went down to the price levels of USD $60 per barrel that we have been accustomed to before the U.S. invaded Iran’s territorial waters in the Persian Gulf. Unfortunately, oil prices will not be going back down to that level for the foreseeable future.

On the issue of who controls the Strait of Hormuz, **Dorsey pointed out that Oman has the same amount of leverage** as Iran for shipping:

“The fact of the matter is that the Strait of Hormuz is part Iranian territorial waters, part Omani territorial waters, and Oman has sovereignty over its territorial waters. Iran legally cannot impinge on that, and that’s the point where Iran may be overplaying its hand because it’s not going to find a lot of international sympathy, including among those NATO countries with which the United States at the moment has strained relations over Iran. They’re not going to support the Iranian position.”

In a previous interview with CNBC, James Dorsey gave his opinions on how the Trump Administration wants to shape the narrative:

“I think we’re used to President Trump creating his own world. Underlying what he said in the CNBC interview…is the notion that Iran is militarily defeated and it’s on its knees and willing to compromise and do whatever takes to end the war. I think if we look at the facts on the ground, that’s not quite correct.”

On the points about U.S. agriculture exports to Iran, this really got my attention because Iran’s market hasn’t previously been known as one that trades in agriculture with the U.S. In fact, this is very foretelling about U.S. agriculture, because the U.S. has struggled to get market access with China in recent years. China has already heavily **switched over to both Brazil and Argentina for soybeans**, for example.

Here’s what Dorsey said about the Iranian funds being used for U.S. agriculture imports:

“I don’t see how Iran could agree to a release of some funds of Iran that then the use of which is dictated by the United States, and then can only be used for purchases in the United States; that in Iran’s perception would be a violation of its sovereignty.”

I totally agree with Dorsey. The U.S. agriculture exports to Iran would be more expensive than all of the other imports options, notably Brazil, Argentina, Russia, Ukraine, Romania, Bulgaria and Australia.

There seems to be this misperception of the Trump Administration that the U.S. is holds a stick to other countries when it comes to U.S. agriculture exports. China has already given a big middle finger to the U.S. government and agribusiness sector in this regard. To think that the Iranian government will simply use the funds to purchase expensive agricultural commodities, all in a favor to a country that it was just at war with, is utterly preposterous.

Source: https://jamesmdorsey.substack.com/p/the-strait-of-hormuz-the-us-and-iran

I publish a newsletter covering current affairs topics and global commodities markets in [**The Long Game Brief**] every week.

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