Iran Update: Clausewitz in the Gulf

The Strait of Hormuz isn't a chokepoint. It's a centre of gravity.

The negotiations between the US and Iran broke down over 21 nautical miles of water, which both sides are now blockading. To every stakeholder including the US, control over the Strait of Hormuz has become the whole ballgame. For the Gulf States it will dictate their influence and their economies in the coming years, for Iran it is their primary lever of coercion and control, and for the United States it is a source of financial suffering and humiliation. However, while the centre of gravity for the Iranian regime has always been Hormuz, for America it is a much more complicated question. More than anything else, the battle for Hormuz will determine how far this war escalates and how long it drags on. But where that battle is fought, and what actually decides it, are two separate questions.

Centres of Gravity

Clausewitz defined the centre of gravity as ‘the hub of all power and movement, on which everything depends’. Historically this has been many things, Alexander the Great’s centre of gravity was his campaigning army, if it had been defeated that would have been the end of his march to the end of the world. For states riven by political division it was their own capital, as that would bring an end to their resistance and collective will. In an alliance the centre of gravity is the cohesion with which that alliance operates, as allies operating cross-purposes cannot succeed. The primary point of identifying the centre of gravity is so that it can be attacked with ‘concentration’. Napoleon would target a decisive victory on the battlefield followed by an occupation of the capital, the purest expression of these theories. The centre of gravity for Iran is the Strait of Hormuz. For the United States Hormuz is where they collide with Iranian power, it is the primary battlefield on which they are fighting this war, with aircraft carriers and sanctions packages, blockades and bombers, but it is not their centre of gravity. For Iran control of Hormuz would provide regional power and a degree of deterrence that would allow the Iranian regime to not just survive but thrive. For the US, the loss of Hormuz would threaten their credibility, and therefore their position within the region and perhaps further abroad. This is why all these factors have narrowed to focus on the strait, military, economic, and political, and this is why the Strait of Hormuz is where this war will be decided.

The Iranian Littoral

To understand why the Strait of Hormuz is so important to Iran you have to first view it as more than just an economic chokepoint. The overwhelming mass of reporting focuses on its capacity as an economic weapon to disrupt oil flows, and thus inflict pain on the rest of the world. As a part of the Iranian littoral it functions as Iran’s main connection to the world. We mean this not just economically, but as US strikes have shown it is where Iran is most vulnerable to military action. And so it is for the other Gulf states. Iranian control over Hormuz allows for coercion in multiple spheres by taking advantage of the connectivity of the littoral regions to threaten energy, financial flows, and military targets. The demonstrated effectiveness of holding Hormuz hostage has also seemingly shifted Iranian strategic calculus. Control over the strait has allowed Iran to negotiate and demand far beyond what its conventional military capacity would allow. However, this has moved beyond coercion to consolidation. As energy markets readjust and workarounds like pipelines and dark ships begin to take shape, control over molecule flow will naturally degrade as a coercive weapon. However by formalising their dominance over the strait, Iran can force concessions from the US in the short term to reverse the economic damage done by decades of sanctions. They can also monetise the passage to the tune of around $1–2m per vessel, $3–8bn a year. Crucially this is frequently denominated in Yuan, which draws the Iranian regime closer to their Chinese allies, and diminishes the power of the petrodollar in the Gulf. Control over the strait, and a more impactful relationship with China will also generate considerable regime legitimacy. The Iranian leadership consolidation on August 10^th demonstrated the result of Iranian strategic success as the hardliners were the overwhelming beneficiaries. The further ascendance of Ahmad Vahidi and his IRGC faction, and the corresponding marginalisation of the moderate faction suggests that Iranian strategic thinking is going to double down on the strait. There is a final reason why this is the case, Iranian control over the strait, and the vulnerability of states to their littoral regions in the era of modern warfare has created an unexpected side effect. The alliances and understandings that underpinned the structure of the Persian Gulf are fragmenting in real-time. Iran have shown not only the limits of US protection, but also the limits of US commitment. Their leverage over the strait has forced Oman into bilateral negotiations, and we would be surprised if there were not bilateral track negotiations between other gulf states and Iran in anticipation of the end of the war.

System Collapse

This move by Iran, to further disrupt the regional order and undermine cohesion threatens the American centre of gravity, which is the order they have underpinned for decades. The system guarding molecule flow out of the Persian Gulf, and their own regional dominance and alliance system. Besides hypothetical bilateral negotiations there are more concrete expressions of the weakening of the US position in the Middle East. In particular the Mecca Joint Defence Agreement signed on August 7^th, between Turkey, Pakistan and Saudi Arabia (with Egypt present but not a signatory). Saudi Arabia’s claim that this is unrelated to Iran, despite the timing and the fact that that particular geographic combination of states happens to encircle Iran, rings slightly hollow. It also happens to pressure Israel from multiple sides, Turkey to the north, Saudi to the south, and the nuclear umbrella of Pakistan to the east. This conflict is not just reordering priorities, but triggering a full blown race for regional dominance outside of the US umbrella. Iran, Israel and Saudi Arabia are all maneuvering to gain primacy and seem to be operating under the presumption of weakened US influence in the region. This can be seen in the Omani bilateral negotiations with Iran about reopening the Strait, in Netanyahu’s public rejection of President Trump’s 15 point Gaza peace plan, and in the Saudi hedging on regional alignment. The importance of the Strait of Hormuz as the regional centre of gravity has altered the stakes of the region. This is not the Gulf States attempting to weather the conflict, but rather the breakdown of the US dominated, Axis of Abraham, oil based regional order. The Gulf states appear to be realising that as the world adapts to Hormuz disruption their financial and geopolitical muscle, in particular Saudi Arabia and the UAE, will be compromised, as other oil producers ramp up production and the markets find workarounds. Therefore creative solutions to preserve their position, and bring a swift end to the conflict are critical to the Gulf States. It is however the US’ position that is most tenuous, with the most to lose and the least to gain.

Economic D-Day?

Secretary Bessent’s new strategy ‘to sever every economic lifeline’ is aimed at Iran’s economic jugular. The economic D-Day is directed towards several industries, critically Oil, Shipping, but also Crypto, Gold, Aviation, and Digital Assets. It hits 6 industries and 60 named entities, a network of brokers, companies, and shadow fleet vessels operating across the UAE, Hong Kong, China, Singapore, Switzerland, Europe, and other regions that move Iranian oil and channel revenue to the IRGC and other regime elements. However, while this will inconvenience and perhaps even damage the Iranian economy, it disregards the key part of the theory we have been discussing today. Clausewitz’s concentration principle says to hit the centre of gravity with everything, the pivot upon which the war turns. This wide dispersal is the opposite, it is a shotgun blast rather than a sniper, and I fear it will simply bounce off without causing critical harm. However a proper attack on Iran’s control over Hormuz would require risking a global escalation. The China artery, the recipient of 90% of Iran’s oil exports, and the one place where concentration might actually pay dividends. China is mentioned within Bessent’s spread of sanctions, but only in areas that are replaceable. A shadow fleet vessel sanctioned is a shadow fleet vessel reflagged and renamed. The conspicuous absence is sanctions on the Yuan denominated settlement system that allows Iran to hold Hormuz hostage. Iran are placing themselves outside the dollar system, and that alone castrates US sanctions before they even take hold. The US have correctly identified the centre of gravity for this war, but to target it properly would risk escalating a limited war into a stand off with a global power. China’s Foreign Ministry stated that “sanctions and pressure tactics do not help in resolving issues, they will only lead to escalation that serves no one’s interest”, which reads as a direct response to Bessent’s sanctions. We mentioned earlier that in this war, American regional dominance is their centre of gravity, globally it would be the dollar system that underpins and reinforces US hegemony. One could view the Chinese statement in the same vein as Bessent’s sanctions, a warning shot.

Conclusion

There are two centres of gravity at play in this war, the Iranian littoral, and the American order, both of which are under attack in the same small stretch of water in the Persian Gulf. Iran’s dominance over the strait is being undermined by every workaround and every Arab barrel that slips out of the Gulf, which is why they are racing to crystallise their coercive power. For Iran, the erosion of the US order is their path to victory. The Americans are staring at the only target they can hit to truly alter the calculus of the war and cannot bring themselves to pull the trigger. Iran are slowly boring through the American centre of gravity. Whether this war is important enough for Washington to risk a confrontation with China is no longer a hypothetical question, rather it is the only question that matters.