Gulf States accept a new normal in Hormuz: Iran is in control

illuminem summarises for you the essential news of the day, reviewed by our editorial team. Read the full piece on The Wall Street Journal or enjoy below:

🗞️ Driving the news: Gulf energy exporters are increasingly accepting that Iran may retain effective control over the Strait of Hormuz, even as they strongly dislike the emerging arrangement to reopen the vital waterway
• For Saudi Arabia, the UAE and other producers, the alternative of returning to full-scale war is seen as even more damaging

🔭 The context: Months of conflict have sharply disrupted traffic through Hormuz, one of the world's most important energy chokepoints
• Iran is now seeking to translate its military leverage into a longer-term political arrangement, including restrictions on US and Israeli naval presence and other concessions
• Washington, meanwhile, has resisted giving Tehran control over shipping access
• For Gulf producers, the emerging compromise represents an uncomfortable trade-off
• Accepting Iranian influence could provide greater predictability for exports, but it would also leave a critical part of their energy infrastructure exposed to Tehran's political demands

🌍 Why it matters for the plant: Hormuz is a fundamental pillar of the global energy system
• A lasting reduction in its reliability could mean higher and more volatile oil and gas prices, greater pressure to diversify supply routes and stronger incentives to invest in energy security

⏭️ What’s next: Will Washington and Tehran agree on a framework that restores commercial shipping without formally conceding strategic control of Hormuz to Iran?
• Negotiations remain difficult, with Tehran demanding major concessions and the US rejecting restrictions on its naval access

💬 One quote: “The problem is they worry the alternative, going back to war, would be worse.” Summer Said and Benoit Faucon, The Wall Street Journal

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