Getting rid of what works, and what doesn’t

This is how the Gulf traffic looks when the strait is open:

As anticipated, the strait of Hormuz is not, as President Trump claimed, open.* Instead, the United States and Iran have now constructed a dual, though not symmetrical, embargo. The US says it will seize ships that are going to Iran or coming from Iran wherever it finds them. Iran is allowing transit of the strait of Hormuz only by non-belligerents Tehran deems. At least for some, worthiness includes payment of a toll, reportedly one million dollars. The two embargoes mean very little is getting through, which jacks up the price of oil worldwide and damages the global economy.

This is a mutually hurting stalemate. For Iran, the hurt is loss of oil revenue. For the US, it is the increase in world oil and gas prices. A well-trained diplomat might say such a mutually hurting stalemate makes the issue “ripe” for negotiation.

It won’t be an easy one

That might get Tehran and Washington back to the negotiating table. But success depends on a mutually enticing way out of the impasse. One possibility is a quick trade: no Iranian blocking of the strait for an end to the US embargo. But the Iranians won’t want to give up the tolls unless they can get sanctions relief. And the US won’t want to give in either to tolls or sanctions relief.

Another possibility is a phased approach for a limited number of ships to call at agreed ports, both Iranian and non-Iranian. That sounds nice, but it will require daily decisions that help some shippers and hurt others. On what basis would the ratio of Iranian and non-Iranian ports be decided? Which ships would get the limited number of daily passes? Quotas are difficult to implement and often have perverse, unanticipated consequences. Hard to picture smooth operation of such a scheme.

A third option is the one President Trump has hinted at: both the US and Iran would stop their embargoes, but they would somehow together collect tolls and the proceeds would be divided. That would give Iran some revenue it desperately needs. It would also end the free “transit passage” provided by the Law of the Sea, but neither Trump nor the Iranians will care about that. If they keep the tolls at 1% or so of the cargo’s value, they’ll get lots of complaints but everyone will pay. Setting up something of this sort would take time and trust. Neither is readily available.

The strait is not the only problem

Though urgent, the closure of the strait is only one of many issues the US and Iran need to discuss. For the US, the agenda has to include the Iranian nuclear program, its missiles and drones, and its allies in Lebanon, Gaza, Iraq, and Yemen. For the Iranians, the agenda has to include sanctions relief, reparations for war damage, and respect for its sovereign right to enrich uranium. That is a huge agenda that the war has made more complicated, not less.

On the nuclear program, the essential first step is a return of the International Atomic Energy Agency inspectors. Without that, no other agreement on nuclear issues will be worth the paper it is written on. President Trump is fond of vaunting that Iran is ready to promise not to develop nuclear weapons. But that it already promised in the 2015 Iran nuclear deal Trump trashed. Better than a repetition of that promise would be a delay in restarting the nuclear program. The US has said 20 years, Iran has countered with 5. That’s the way they sell carpets in the Middle East.

Iran’s missiles and allies are non-starters. Tehran will not deal on those, or if it does the deals will be violated.

As for Iran’s agenda, some sanctions relief is possible, in exchange nuclear inspections, a delay in restarting the program, and possibly a limit on enrichment. Reparations are a non-starter. President Obama gave back some of Iran’s own frozen assets. That might happen again. Any American president who gives tax money to the Iranians would have to be nuts.

What next?

A lot depends now on what Iranian regime chooses to do. It has certainly not changed its stripes. President Trump knows perfectly well that his claim that he has changed the regime and moderates are now in charge is false. That claim is calculated to make an agreement with Tehran palatable to the American public and Congress.

The Islamic Republic of Iran will remain rhetorically committed to destroying the Jewish state and restoring Jerusalem to Islam. Without that, an explicitly Shia regime cannot pretend to lead the Muslim world, which is what the Islamic Republic aims to do. The question is whether Tehran will prioritize for the foreseeable future defending its own territory and satisfying its own people. That would entail giving up the “forward defense” that served so poorly in the past two and a half years. The ideological goal might remain, but in practice the new leaders could decide they had better not pursue it until they are stronger.

That would be risky. Peacetime will bring back Iranians’ grievances, which will have redoubled during the war. The regime was arguably on its last legs when the Israelis and Americans attacked. It might not survive an end to tension with the West.

*After I published this piece this morning, Iran announced that the strait was open so long as the Lebanon/Israel ceasefire remained in force. President Trump confirmed that the strait was open but also said the US embargo remained in place. Tehran was still requiring that ships coordinate with its security forces and follow a route they dictate. I suspect the tolls remain in place as well.