Long read: The complexities of the Strait of Hormuz crisis

Pictures from the semi-official Tasnim news agency show the Stena Impero being seized and detained between 19 July and 21 July 2019 near strait of Hormuz, Iran. Credit: Contributor#072019/Getty Images

The situation in the approaches to, and in, the Strait of Hormuz (SOH) has deteriorated rapidly for merchant shipping from May this year.  In mid-May, four commercial vessels were sabotaged (probably by limpet mines) near the bunkering port of Fujairah.  No oil was spilled but the attack has caused significant damage to the ships’ structures.  In mid-June, two further vessels appeared to have been attacked in a similar way while en route eastwards near the Iranian Makran coast in the Gulf of Oman (GOO).  Later in June, a US drone was shot down, with a US retaliation threat called off at the last minute.  And, in retaliation for the (UK Overseas Territory) Gibraltar government early July seizing of a tanker carrying Iranian oil, supposedly bound for Syria, a British-flagged bulk carrier, the Stena Impero, was seized by the Iranians on 19 July while transiting the SOH. An earlier approach to another British-flagged tanker had been warded off by the Royal Navy frigate HMS Montrose, but was not close enough to have been able to help the Stena ship.

So, what has caused the current crisis?  We must look back in recent history to the Joint Comprehensive Plan of Action (JCPOA, also known as the Iran Nuclear Deal) – an agreement signed by Iran and the P5+1 (China, France, Germany, Russia, United Kingdom [UK], and United States [US]) to pre-emptively address the issue of Iranian nuclearisation.  The intention was to impose tight restrictions on Iran’s nuclear programme, before it could reach weaponisation, in exchange for sanctions relief that would assist in Iran’s economic recovery.

From the signing of this agreement in July 2015, Iran was able to export oil, thus adding stimulus to its economy. However, in May 2019, President Trump, dissatisfied with Iran’s intentions within the deal, announced that the US would be withdrawing from it and re-imposing sanctions.  Notwithstanding the European Union (EU) countries’ remaining with the deal, the US sanctions have negatively affected Iran’s economy again.

Almost certainly linked to the US withdrawal from the JCPOA and re-imposition of sanctions are the attacks in Fujairah and the GOO in May and June respectively.  Iran may have been further weakened, but its Republican Guard Corps Navy (IRGCN) are under direct orders of the country’s leadership and are able to disrupt shipping in well-co-ordinated attacks, with seemingly little effort.  They are yet to show they can cause severe disruption.

The seizure of an Iranian tanker in early July near Gibraltar by British forces served to further escalating tensions between the two countries. The vessel was accused of violating EU sanctions on Syria, with the tanker supposedly carrying Iranian oil to Syria: a country also under a sanctions regime but whose government is supported by Iran and a willing recipient of its blacklisted oil. Although the regime troops had shot down a US drone, targeting a US-flagged ship would have likely brought too tough a response; the Brits are a different matter.

The UK has one frigate permanently based in the Gulf region, currently HMS Montrose, and cannot hope to protect all of the up to 30 UK-flagged vessels that pass through the SOH daily.  Iran had warned that it would carry out reciprocal action on a British-flagged ship after the Gibraltar incident of 5 July, and, with little difficulty, achieved it on the Stena Impero. The British Navy’s HMS Duncan has just arrived (29 July), but will very soon be the sole protector as Montrose heads to Bahrain for planned maintenance.

Actions have consequences

The threat from Iran to the SOH and its approaches is constant.  The SOH is one of the most important waterways in the world, connecting crude oil producers in the Middle East with key markets in the rest of the world. Daily flows of oil account for approximately 30% of all petroleum products.  The UK is dependent on a constant flow of liquid natural gas from Qatar to its shores; disrupt that chain and its reserves will be rapidly depleted.

According to Apostolos Rompopoulos, a senior tanker chartering broker from Intermodal, there are three possible scenarios.  The optimistic one is for the SOH to be closed for a few days, seeing a brief spike in oil prices due to the uncertainty of the outcome.  The capacity of pipelines in the UAE and Saudi Arabia should be effective in by-passing the SOH.  The pessimistic scenario would be for a closure of up to 45 days, leading to historically high crude prices.  The Doomsday scenario would see the strait closed for up to three months, with prices reaching such levels that the only consequence from which would be a global recession.

As an immediate reaction, tanker owners are already restricting the number of voyages, and war risk premiums have increased significantly.

Possible solutions

The clear early solution is the formation of a multinational naval task force, probably a coalition under the leadership of the US, to escort vessels through the SOH. Apart from some losses of commercial and naval vessels, this worked well during the height of the Iran/Iraq war (‘the tanker wars’) from 1986–88.  The main issue with bringing this force together, however, is political.  The US would not want to do it alone, but it is only the US that has withdrawn from the Iran Nuclear Deal; the EU does not support the tough US approach to Iran and would not wish to be seen operating in such a coalition.

It was with this in mind that Jeremy Hunt, the then UK’s Foreign Secretary, proposed that the EU should form its own naval escort force for the SOH.  The EU naval operations (Atalanta in counter-piracy and Sophia in counter-human smuggling), albeit on a relatively small scale, have been successful in the last decade, and the idea is gaining traction in Paris and Berlin.  The advantage of forming an EU force is that the majority of nations wishing to maintain a softer stance against Iran would still be able to take action, but outside the more hard-line US leadership.

This model succeeded during the counter-piracy days of 200816, when three squadrons – NATO, the EU, and the Combined Maritime Forces (CMF) – worked well together; each had a different mandate and each with attractions to different nations.  The result was a higher number of naval vessels than there would have been if there had been just one force.  Other assets such as surveillance aircraft, protection aircraft, and intelligence sources would be essential parts of a comprehensive protection system, working alongside diplomatic pressure.

The British Royal Navy itself, like other European navies, would not be able to provide sufficient ships to conduct convoy protection independently. From 25 destroyers and frigates (escorts) in 2008, the Royal Navy now has 19, of which up to a half may be in maintenance and a proportion of the remainder will be engaged in other tasks such as protection of UK waters and overseas territories.

While the tensions mount, and hard and soft pressures are brought to bear, the single most important factor remains the safety of seafarers. If they cannot be sure that they will sail securely through these troubled waters, they and their owners will not feel inclined to do so with the consequent impact on global trade and stability. Multinational convoy escort forces have been shown to work in the past, satisfying all political imperatives, and there is no reason why they should not succeed now.