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Iran War: Omani Route Tests Iran Control of Strait of Hormuz as Rubio, GCC States Reject Iran Management; Iran Yet to Respond to Israel Ceasefire Violations, Intent to Stay in Lebanon; More Doubts about $300 Billion Fund

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[Today’s Iran war post fired before finished. Please return at 8:00 AM EDT for a completed version]

Iran is facing a test of its skill and resolve. It is now an open question as to whether Iran will be able to assert control over the Strait of Hormuz in peacetime conditions. We pointed out repeatedly that Oman, unlike Iran, was a signatory to UNCLOS, which binds Oman to allowing transit of vessels through its territorial waters to states beyond. We noted that Oman had publicly remained silent in the face of repeated statements of Iran intent, and some outreach, of the Iran plan that Iran and Oman would manage the Strait of Hormuz.

If Oman does not cooperate, and it is not cooperating, it fatally undermines Iran’s ongoing leverage. Oman does not house US airbases its pointed neutrality meant Iran did not target Oman during the war. So unless the war heats back up, it is not clear how Iran could exploit that to interfere with vessels in Oman waters.

Note the umbrage at the idea of establishing a new Strait of Hormuz regime. From Aljazeera’s live feed:

Arab Gulf states reject ‘new geopolitical facts’ born from aggression: UAE presidential adviser

New “geopolitical facts” cannot be imposed on the Arab Gulf states as a result of a “treacherous aggression against them”, the UAE’s presidential adviser Anwar Gargash says.

The Oman side is a viable traffic route:

And:

I have seen comments in Twitter which I have not attempted to verify, that very large crude carriers cannot use the Omani side because it is too shallow. But the fallback is to load fuel onto smaller carriers and transfer it to bigger ships, either at sea or in a nearby port.

Per Iran International, Oman has rejected transit fees:

Oman said future arrangements for the Strait of Hormuz would not include transit fees, as it backed a memorandum of understanding between the United States and Iran.

Oman’s foreign minister made the remarks at a joint ministerial meeting between the Gulf Cooperation Council and the United States in Bahrain, Oman News Agency said.

He said Oman, as a state bordering the Strait of Hormuz, had a special responsibility to support international efforts to secure maritime navigation under international law and the UN Convention on the Law of the Sea.

Oman also called for the restoration of freedom of navigation and safe shipping through the strait, and said the US-Iran MoU should achieve its objectives to help deliver peace.

Iran is objecting vigorously to the use of the Oman route. From Aljazeera in Iran warns against Hormuz crossings without authorisation:

Iran’s Revolutionary Guards (IRGC) have warned against any crossings of the Strait of Hormuz without authorisation, saying vessels not complying “will be dealt with” and criticising a new route through the waterway.

The future of the strait, a vital route for energy shipments that was effectively blocked by Iran during the more than 100-day war between the United States and Iran, is a key sticking point in negotiations between the sides….

“The only authorised route for passage through the Strait of Hormuz is the route announced by the Islamic Republic of Iran,” the Revolutionary Guards, the ideological arm of Iran’s military, said on Thursday.

Any crossing without authorisation is “unacceptable and extremely dangerous”, they warned in a statement.

They also denounced what they said was a new route through the waterway announced by “certain authorities”, without elaborating.

Keep in mind that there have been splits between the IRCG and the political leadership before, as in at least one occasion I can recall when the IRCG declared the Strait of Hormuz to be closed and the officialdom then involved in negotiations denied that. In the recent declarations of Strait of Hormuz closure, the IRCG does not appear to have backed that up with action, such as sending vessels or firing shots near non-compliant ships.

The opening of the just-started meeting between the US and GCC states had the President of Bahrain, presumably voicing a shared position, and later Secretary of State Rubio, both state that the Strait of Hormuz would have free passage:

If Bahrain’s statement indeed reflects a consensus view in the Gulf, that means Iran’s hope of securing GCC cooperation with its navigation control/fee plan is toast, ex a kinetic war flareup that leads them to relent in the face of new realities. As things stand, it does not appear that Oman will join Iran in asserting control over the Strait of Hormuz in the face of opposition from most (all?) GCC members.

Needless to say, Trump reaffirmed his existing position that no way, now how will Iran levy Strait of Hormuz transit charges:

A more consequential item is that US digging in on its claim that Iran will not be allowed to charge fees on Strait of Hormuz transits. From Bloomberg in Hormuz Fees Branded ‘Unacceptable’ by Trump in Warning to Iran:

  • President Donald Trump said tolls on ships sailing in the Strait of Hormuz would be a red line issue for the US in negotiations with Iran.
  • Trump stated that it would be unacceptable to him if a final Iran deal included any service or shipping fees in the strait.
  • Iran has signaled that it plans to administer the strait, and has said that ships need its permission to cross the waterway and would require a mandatory insurance policy to do so.

Asked if he would reject a final Iran deal if it included any service or shipping fees in the strait, Trump said that he would.

“It would be unacceptable to me, because we have numerous strengths, and if you did that for them, you’d have to do it for other people,” the president told reporters at the White House on Wednesday. “It would be a game changer.”

Mind you, as tough as this sounds, recall that “unacceptable” is an admission of weakness. It seems unfathomable that the US would ever give the Persian Gulf Authority formal permission to charge fees. Any final pact merely needs to be silent on this issue.

But if Trump really means what he is saying, will Iran reject a final agreement? Given widespread opposition to Iran controlling the Strait, this would not be a great hill for Iran to die on, even if, as Robert Pape points out, the Strait of Hormuz is the mechanism by which Iran could become a fourth world great power. But the US is likely to fail to deliver on the MOU in enough other ways that the Strait of Hormuz becomes the mechanism for compliance, as opposed to a mere disputed point in the talks.

Ironically, Israel could allow Iran to again assert dominance over the Strait of Hormuz by force of arms if things get so ugly that Iran fires on locations in Israel that are supporting the Lebanon operation and Israel strikes back, either via bombing or assassinations. But it is still faced with how to maintain dominance on an ongoing basis.

I do not share the hope of many that Iran-Gulf state discussions per below will do more than come to an understanding about these nations restricting US use of their territory and airspace in return for Iran not shooting at them again:

The latest Israel-Lebanon ceasefire lasted only about 48 hours. Israel killed two men for the aggressive act of operating a bulldozer…in an area badly in need of rebuilding. More important, Israel is insisting no way, no how is it leaving southern Lebanon. Many commentators close to the negotiations, such as Trita Parsi, have said Iran regards the commitments in the first clause of the Memorandum of Understanding (MOU), which effectively includes Israel leaving Lebanon, as paramount. Iran so far has been silent about these violations. And it seems clear that mere stern words from Iran about Lebanon will not suffice. We’ll return to the state of play in Lebanon soon.

Israel is digging in on defying the MOU by insisting it will stay in Lebanon and violating the ceasefire. The Hareetz headline says it all: ‘Soldiers In, Residents Out’ Netanyahu: Israel Won’t Withdraw From Lebanon ‘As Long as I Am Prime Minister’

Not only is Israel doubling down on its insistence that it is staying put in Lebanon, Israel Defense Minister Katz says that the US has not asked Israel to leave:

From a lightly edited machine transcript:

Hindustan Times narrator: Israel’s Defense Minister Katz also defied Trump’s broader regional approach, insisting the IDF would remain in Lebanon.

Katz [translation in video clip] : The IDF is prepared in the yellow line, and we are not retreating. We announced that in any case, we are not withdrawing as of this moment. And this is a political achievement. There’s no American demand for Israel to withdraw from Lebanon.

Interviewer: There is no such demand?

Katz: There is no demand, and in any case, we will not withdraw.

Interviewer: Even if there is? Even if there is an American demand, we will not withdraw from southern Lebanon?

Katz: But there is no demand. We’ve made it clear. The Prime Minister to the President meet to Pete Hegseth, the Secretary of War, the IDF.

We are there to protect the residents of the north.

This Reason2Resist report shows Trump blowing off repeated questions from a reporter about what Trump will do about Israel saying it will not leave Lebanon (starting at 10:20):

An aside: Lascaris towards the end also provides a helpful discussion of the legal issues raised by Iran’s plan to regulate Strait of Hormuz traffic and later charge fees.1

Trump seems emboldened by the fact that oil prices are falling due to the inventory on ships bottled up in the Gulf getting out and the prospect of normalization. Thus if the US continues to disregard the MOU, most importantly via not using its considerable leverage over Israel to force the settler colony to exit Lebanon, Iran will have to take steps that threaten the flow of oil and goods. And mere statements that the Strait of Hormuz is closed, not backed up by action (at least of the “shot across the bow) may not suffice.

And let us also keep in mind that any action by the Trump Administration against Israel is likely to be hesitant due to the clout of the Israel lobby (which is still a force even if the sweep of anti-Israel candidates in New York shows its power is now fiercely contested in the Democrat party) as well as Trump’s personal long-standing ties to Zionists, as demonstrated by their high representation in his inner circle. Expect the US to devise half-pregnant solutions for Lebanon which Iran is sure to reject. So the arm-wrestling over Lebanon could continue for a while, assuming Iran demands the US hold fast to its MOU commitment. But again, I don’t see how Iran has any hope of prevailing unless it shows it will again clamp down hard on Strait of Hormuz traffic.

True to form, Israel is engaging in what Chas Freeman has called a ceasefire with Israeli characteristics. From Elijah J. Magnier on Twitter:

For the second consecutive day, Israel violated the ceasefire under the cover of US consent, exposing the fragility of the agreement and the complicity of Washington.

After several months of fighting, many Lebanese remain buried under the rubble across different parts of southern Lebanon. For the Lebanese resistance who fought against the occupation forces, the priority now is not immediate retaliation for Israeli violations of the ceasefire, but the recovery and burial of its fallen fighters, the reorganisation of its ranks, and preparation for whatever comes next.

The time for a response, the resistance believes, will come in due course. For now, the movement is absorbing its losses, honouring its dead, and ensuring that its military structure remains intact and reinforced for the next confrontation.

And:

Aljazeera reported at around 2:00 AM EDT that an Israel soldier died in Lebanon. However, later reporting says this was an accident, os it may not lead to more Israel escalation.

The US side is pushing against Iran on other issues. A delicious statement of where things seem to be:

Continuing with the outtrades between the US side and Iran, the Middle East Eye live feed includes the entry: UN nuclear chief says inspections in Iran will go ahead despite Tehran’s caution:

The head of the International Atomic Energy Agency (IAEA) says the UN’s nuclear inspectors will visit Iran’s enrichment sites, despite Tehran indicating that any such inspections will only take place after a final agreement is reached.

“This is going to happen,” IAEA Director General Rafael Mariano Grossi said on Wednesday…

However, an Iranian diplomat said any visits by IAEA inspectors would only take place once a final deal has been concluded.

This is just silly. How many divisions does the IAEA have?

Since we expect this to come into focus at some point, we will not spend too much time on the barmy $300 billion fund idea, even though it is right there, as big as life, in the MOU. The Gulf states, which the US has tried to depict as the piggy bank for this scheme, are already mighty upset with the US. It is an awfully tall order to ask them to pay for Iran reconstruction when they haver their own to do and they are already hopping mad about not having been consulted during the talks. From CNN in Trump’s Gulf allies fear his Iran agreement is a ‘disastrous turning point’

Gulf states had opposed the 2015 Iran nuclear agreement reached under the Obama administration and cheered Trump when he tore it up in 2018 because it didn’t address their concerns. The emerging US-Iran pact is likely to generate even greater unease in Gulf capitals, not only because it leaves many of those concerns unresolved, but because it comes amid what Alhasan described as a “major loss of confidence in the US.” A senior Gulf diplomat told CNN the conflict showed that “Iran had a well-developed plan to target” Gulf states….

The pact also requires Gulf buy-in because it includes a $300 billion reconstruction fund for Iran. Trump committed Gulf funding to the initiative, but there is little evidence that Gulf states have done the same. Saudi Arabia has said it has “no details” about the proposal, while Qatar has expressed interest without formally signing on.

Rubio said he would not be asking allies for monetary help with the $300 billion Iran reconstruction fund during his trip, calling that “far down the road.”

BWAHAHA. That is out of line with the text of the MOU:

The United States of America undertakes with regional partners to develop a definitive, mutually agreed plan with at least USD $300 billion for the reconstruction and economic development of the Islamic Republic of Iran. The mechanism for the implementation of this plan will be finalized as part of a final deal within 60 days.

So Rubio looks to be admitting that the US expects to renege on this part of the deal…or push reaching a final pact way way off.

Rory Johnson provides a generally informative discussion with Mario Nawfal on the present status of Strait of Hormuz transit, with one caveat: he seems completely unaware of the role that the oil cliff play in Trump suddenly deciding to capitulate to Iranian demands. However, describes how (as we anticipated) that even though the oil flow coming out now is significant, it still consists largely of loaded tankers that had been trapped in the Gulf exiting. Energy and other supplies will not reach stable levels until there are two-way transits, or as Johnson puts it, that there are loadings talking place in the Gulf.

Sal Mercogliano describes how shipping, even though up in the Strait, is still tentative, with a lot of vessels running with transponders off. Mercogliano seemed a bit surprised that the US blockade is off; one could read that as implying that the US had cut its naval force presence, but a new report on Hindustan Times cites CENTCOM reaffirming that its main assets are still in theater. He seemed also seemed a bit surprised Navy not entered the Gulf (Mercogliano seemed not to recognize that that could be construed as an act of aggression under the first clause of the MOU)

____

1 Lascaris, who is a lawyer, effectively said that Iran had a colorable position. I made an erroneous earlier characterization of the legal standard Iran is relying on, which is “innocent passage”. Iran could argue that any ship from or connected to countries that has supported the war were subject to control and therefore also fees.

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5 comments

  1. The Rev Kev

    This all sounds like Trump is trying to renege on every point that he agreed upon with that MoU. The agreed upon passage fees, the $300 billion fund, the pull back by Israel in Lebanon. I would go so far as to suggest that Trump even had Grossi start squawking about nuclear inspections to help derail the negotiations. But it may be that Iran is playing the long game here as they know that there is an economic cliff coming up, even for the US, and that when it happens, the pressure on Trump will be tremendous to buckle to Iran’s demands. And they will not even have that long to wait as we are already near the end of June.

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  2. Cocomaan

    If Oman has decided to grow a spine it looks like Iran is going to have to decide whether they’re going to use their clout or not.

    And they might not. They have to live next to their Gulf neighbors and we do not.

    Seems to me that them taking military action and closing the Strait again would result in them facing more international condemnation, as “peace” was established. Trumps bloviating might have actually turned the narrative around for most people who have short memories. And long term a lot of players aren’t going to be using Hormuz to move goods if they can help it.

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    1. ISL

      All Iran has to do is blame it on Israel and its new genocide in Lebanon, along with a barrage (or ten) into Tel Aviv. Strait closed and leave it closed until Israel retreats and Oman comes to its senses (or bankrupcy). The cliff is approaching fast and a deseperate Mr. Market will force Trump to force everyone in the Gulf’s hand (except the comprimat holding Israel).

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  3. ChrisFromGA

    The optics of this aren’t good for Orange Julius. He’s having to haggle and bicker with the Iranians over every term in the MoU. That’s not “full spectrum dominance.” Whatever happened to “winning the war in four weeks?”

    This is no Venezuela. Plus, the continued back and forth, along with the threat of hostilities resuming, means he can’t pivot to other things, like the Ukrainian war. He’s trapped.

    Reply ↓

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