Hamid Mollazadeh
At first glance, the Middle East—and particularly the Persian Gulf—no longer appears central to US energy security. Thanks to the shale revolution and rising domestic output, the United States has significantly reduced its direct dependence on crude oil from the region. Yet Washington’s sustained presence in the Persian Gulf tells a more complex story, one in which oil is no longer the sole driver, but remains an essential strategic variable—especially for Iran and the Strait of Hormuz.
From a purely supply perspective, the US can now meet much of its oil demand domestically or source additional volumes from other producers, including Latin America. In theory, even Venezuela could serve as a fallback option should Washington succeed in reasserting control over its oil sector. This reality has diminished the Persian Gulf’s role as a critical supplier for the US itself. However, it has not reduced the region’s geopolitical value.
The United States continues to play the role of security guarantor for major Persian Gulf oil producers—excluding Iran—not because it urgently needs their barrels, but because it seeks to preserve its strategic hegemony over the world’s most sensitive energy corridor. Control over the Persian Gulf is ultimately control over global energy flows and by extension, over the economies that depend on them. In this sense, America’s presence in the region is less about demand and more about influence.
Containing Tehran’s Regional Reach
For Iran, this distinction is crucial. While US policy toward the Persian Gulf is no longer driven by oil dependency, it remains deeply shaped by political considerations aimed at containing Tehran’s regional and economic reach. Iran’s own oil output and daily export volumes, constrained by sanctions, are currently not large enough to move global markets on their own. As a result, short-term political developments involving Iran rarely have a direct and immediate impact on oil prices.
Nevertheless, Iran occupies a structurally significant position by virtue of geography. Any escalation that threatens security in the Persian Gulf or disrupts traffic through the Strait of Hormuz—the artery through which roughly a fifth of global daily oil trade (20 billion barrels of oil) passes—would have far-reaching consequences. In such a scenario, even limited instability could trigger sharp price volatility, regardless of Iran’s actual export levels. The market’s sensitivity is not to Iranian supply at all as it can be compensated for easily, but to the risk of broader disruption affecting multiple producers and shipping routes.
Room for Maneuver
At the same time, Iran’s room for maneuver in the oil market remains constrained. US sanctions, combined with the alignment of secondary consumer countries with Washington’s policies, have narrowed Tehran’s options. In practice, China has emerged as Iran’s only consistent buyer.
Over the years of sanctions, Beijing has demonstrated a steady willingness to purchase Iranian crude—often at discounted prices that favor Chinese refiners and traders. While the commercial terms are far from ideal for Tehran, maintaining stable and pragmatic relations with China has become a strategic necessity rather than a choice.
Beyond geopolitics, the structure of the global oil market itself limits Iran’s influence. Prices are no longer shaped solely by physical supply and demand. Instead, financial actors—including major trading houses, investment funds, and banks—play a decisive role as market makers.
These institutions exert control through futures exchanges and derivatives markets, managing price levels in line with their broader financial interests. The United States, as the political and financial anchor of this system, remains a central and indirect force in price formation.
Geopolitical Shock
Recent history offers a clear illustration. During the intense 12-day war in the region, markets remained largely unmoved despite what would traditionally be considered a major geopolitical shock.
This apparent disconnect underscored the extent to which oil prices are buffered—and at times overridden—by financial management rather than immediate geopolitical risk. When it suits market makers, political developments are absorbed; when it does not, the same developments can be amplified to justify sharp price movements.
For Iran, this means that regional political developments matter less in isolation and more in their potential to alter the security of the Persian Gulf as a whole.
As long as tensions remain contained and shipping lanes remain open, Iranian oil flows—already marginal in volume—will not dictate market direction. But if instability were to spill into the Strait of Hormuz, affecting the transit of other producers’ crude, the impact would be swift and global, pushing prices higher regardless of broader supply fundamentals.
In this context, Iran’s strategic challenge is twofold: preserving its economic independence under sanctions, while navigating a global oil market increasingly shaped by geopolitics and financial power rather than barrels alone. The Persian Gulf and the Strait of Hormuz remain central to this equation—not as sources of oil for the United States, but as levers of global influence that no major power is willing to relinquish.
