US President Donald Trump has warned that Iran could face “very Draconian sanctions” while downplaying the future strategic importance of the Strait of Hormuz, saying increased US energy production and alternative supply routes have reduced global dependence on the key waterway.
“We have things that we could sanction. We have very Draconian sanctions, and we’ll see what happens,” Trump said at the White House when asked about possible new measures against Tehran.
Trump said vessels were continuing to move through the Strait of Hormuz, which links the Persian Gulf with the Arabian Sea and is a major route for global energy shipments.
“Right now, the Strait is open; we’ve got a lot of boats coming through, people aren’t reporting that,” he said, adding that traffic could slow at some point.
Trump also claimed that a US naval blockade against Iran had prevented ships from reaching the country, though he did not provide figures to support the claim.
“The naval blockade has been extremely effective,” he said. “No boats have gotten into Iran, but they are getting in for other places.”
The President said there had been brief pauses in the operation under an agreement but accused Iran of failing to honour its commitments.
“The deal didn’t terminate — you know, the deal didn’t turn out to be what they said,” Trump said.
Trump framed the administration’s next steps as a choice between reaching an agreement that could push oil prices lower and continuing with the existing US strategy.
“It’ll either be extremely good, and oil prices are going to drop like a rock, or we’ll continue to do exactly what we’re doing,” he said.
He also pointed to the absence of the sharp rise in oil prices that had been forecast amid tensions, saying prices were currently around $84-$85 a barrel.
“You know, they were talking about $350 a barrel, and it’s today $84 or $85. And we are getting a lot of oil out,” Trump said.
He attributed the relatively stable oil prices partly to increased US energy production and the development of alternative supply infrastructure.
“But the other thing that’s happened is people have found other alternatives, which they never thought about, Texas, Alaska, Louisiana and other places,” he said, adding that “record numbers of pipelines” were being built.
Trump said these developments could reduce the Strait of Hormuz’s importance to global energy markets.
“So, I think the Hormuz Strait is not going to be quite as important as it was in the past,” he said.
His remarks came during a White House event with leaders from the finance, cryptocurrency and technology sectors. He was responding to a question about a statement by the Treasury Secretary that the administration could announce its most consequential sanctions against Iran during the week.
-IANS
