The shift by the United States and Iran toward economic warfare carries grave risks for the Gulf region.
The Trump administration today is to announce a broad package of measures designed to strangle the Iranian economy, which was imploding even before the war began.
It has said a key element will be US economic punishment of countries that continue to do business with Iran.
The new package is a sharp escalation from the US military’s current long-distance blockade of Iranian ports, which involves intercepting ships that trade with Iran in waters outside the Gulf.
The Iranian regime’s new security chief, hardliner Mohsen Rezaei, on Saturday said any country involved in the US economic war would be treated as an “enemy” if it failed to stand down following negotiations with the regime.
Rezaei vowed that the Islamic Revolutionary Guard Corps (IRGC) would maintain its chokehold on the Strait of Hormuz, the narrow waterway at the mouth of the Gulf through which some 20 percent of global oil supplies and other important commodities passed before the war.
Iran today named 45 oil and LNG tankers and other commercial vessels that it said it had blacklisted for attempting to pass through the Strait outside its control by sailing along the Omani shore, opposite the Iranian shore. Some of the 45 ships are operated by Saudi Arabian and Emirati interests.
The IRGC has attacked several tankers and other vessels this month and clearly is poised to strike more.
It’s aim it to keep global fuel prices high, maintaining domestic political pressure on President Donald Trump.
Trump shifted to economic warfare after ordering significant yet limited airstrikes against Iran in July that failed to loosen the IRGC’s grip on the Strait or otherwise push the Iranian regime into making concessions.
He backed off his threat to launch far more devastating airstrikes apparently due to concerns about the efficacy of such an escalation and lobbying from the Gulf Arab countries, which took seriously renewed Iranian threats of missile and drone attacks on their oil industries and other economic targets.
Falling in line with the Trump administration’s heightened economic campaign against Iran, the United Arab Emirates on Wednesday announced a halt to all trade and financial transactions with Iran.
The move could be hard hitting, since Iran in recent decades has skirted economic sanctions in no small part through front companies based in Dubai.
But those black and gray channels would be difficult to shut down entirely, and the Emirati royal regime may hold back for fear of retaliatory Iranian missile and drone attacks against its economy.
Other Gulf Arab countries similarly may endorse the Trump administration’s economic war escalation while holding back to appease Iran.
Trump may feel compelled in coming days and weeks to stage limited airstrikes in retaliation for IRGC attacks on ships in and near the Strait.
The IRGC almost certainly would respond with missile and drone attacks on US military forces in Kuwait, Bahrain and Jordan, and perhaps the UAE and Saudi Arabia.
The IRGC also could hit economic targets in those countries to a limited extent.
In the worst case, developments could spin out of control, leading to the resumption of all-out war that would include major Iranian missile and drone attacks on the Gulf Arab countries, Jordan and Israel.
Personnel may undertake important business travel to the Arabian Peninsula south of Turkey with the exceptions of Lebanon, Syria, Iraq and Yemen.
Personnel traveling to the Gulf Arab countries, Jordan and Israel should monitor Iran-related tensions constantly. They and their employers should be cognizant that commercial flights could be disrupted if US-Iran hostilities escalate and that employers would bear the responsibility of repatriating stranded personnel.
Personnel in the Gulf countries should steer well clear of US diplomatic facilities, oil and gas infrastructure, and military bases – all of which are prime Iranian missile and drone targets. They should monitor the advice of local authorities and their embassies. In the event of an air attack alert, personnel outdoors should seek shelter and those indoors should give wide berth to windows. High-rises are not ideal places to be during air attack alerts, and those in one should keep in mind that underground parking garages are relatively secure from drones but not immune and that stairways rather than elevators should be used in the event of drone attack or fire.
Personnel in Saudi Arabia should not visit the southwestern provinces of Najran, Jizan and Asir, which are prime targets for missile and drone attacks by the Yemen-based Houthi militia, an ally of Iran.
Personnel in Israel should remain well clear of the border with Lebanon, where a fragile truce is in place between Israeli troops and the local Shia militia Hizbollah, an Iranian proxy. They should familiarize themselves with the nearest bomb shelters and be prepared to heed air attack alerts and related instructions from authorities.
Personnel in Jordan should monitor advisories from local authorities and their embassies.
