The Iran War is dramatically reshaping world geopolitics in unanticipated ways. At the outset the war revolved around the imperative of denying nuclear weapons to the fanatical regime in Tehran. Now the war’s endgame – control of the Strait of Hormuz – is revealing an underlying and profoundly important issue: who has and controls access to global energy supplies.
In a May 4th article on X – “Iran’s Historic Mistake” – economist James E. Thorne wrote that Iran's weaponizing of the Strait of Hormuz was a strategic blunder of historic proportions. Intending to punish America, Tehran instead “exposed every power built on imported energy, vulnerable sea lanes, and the delusion that globalization repealed geography.”
Exposed as losers by this revelation are Europe and Asia, particularly China. The winners are the Western Hemisphere, most notably the United States.
China, despite its military and economic might, cannot be secure while it is reliant on imported oil and gas moving through vulnerable maritime choke points. Europe chose to abandon the cheap Russian energy that anchored its economy for decades, and now finds itself dependent on imported oil and liquid natural gas (LNG) both exposed to maritime coercion.
The larger lesson here is that secure, natural-resource hard power is what the Western Hemisphere possesses in abundance. The US, Canada, and the Americas command hydrocarbons, LNG, farmland, fresh water, critical minerals and strategic leverage, on a scale import-dependent Europe and Asia simply cannot match. Thus, the Strait of Hormuz crisis has clarified, not weakened, America's structural strategic position.
Another emerging reality is that hard resource power and monetary power reinforce each other. Here the status of the American dollar as the world's dominant reserve currency further enhances U.S. leverage. Historically, times of crisis strengthen the dollar while the currencies of rivals are correspondingly weakened, as has been demonstrated in the period since the war’s outbreak. President Trump well understood this dynamic, and Treasury Secretary Bessent skillfully shaped U.S. monetary policy accordingly.
Battered by the overwhelming American-Israeli military assault, Iran sought to stalemate the war by weaponizing geography via the Strait of Hormuz. The U.S. quickly countered this strategy by imposing a naval blockade which devastated the export-dependent Iranian economy.
Globally this confrontation has turned into a demonstration of who has reliable resources of energy and who does not. Nowhere is this contrast more vividly illustrated than the stark difference between China – with 48% of its 2025 crude oil imports (pre-Iran war) passing through the Strait of Hormuz – while the comparable figure for the United States is a mere 2.5%.
While China holds an estimated 1.39 billion barrels of oil in storage, covering 120 days of net imports, that safety margin is rapidly diminishing. Beyond question this reality loomed large in the background of the recent meeting between Presidents Xi and Trump in Beijing.
Yet another factor increasing pressure on China's energy security is the recent dramatic change in the status of Venezuela – holder of the world's largest proven crude oil reserves, an estimated 303 billion barrels. Prior to the ouster of Nicholas Maduro, China purchased 68% of Venezuela's oil at a discounted price owing to the political affinity between the two authoritarian regimes. The U.S. purchased just 23% (data as of 2023). At present the U.S. is taking control of Venezuela's oil exports and sales to China have been restricted and no longer offered at discount prices. Exports to the U.S. are projected to rise significantly.
While the final consequences of the Iran War cannot be foreseen, it is clear that energy as a factor in world geopolitics will be larger than ever before. The Biden administration’s “War on Fossil Fuels” gravely threatened America's security and influence in the world. By reversing that policy and making “energy dominance” a foundation of U.S. economic and military priorities, the Trump Administration has dramatically reshaped today's geopolitics.
The German military theorist Karl von Clausewitz (1780- 1831) famously wrote that “War is a continuation of politics by other means”. Two centuries later it is clear that those words retain their relevance.
William Moloney studied history and politics at Oxford and the University of London and received his doctorate from Harvard University. His columns have appeared in the Wall St. Journal, USA Today, The Hill, The Washington Post, Washington Times. Philadelphia Inquirer, Baltimore Sun, Denver Post and Human Events.