U.S. naval blockade on Iran will trigger a currency devaluation spiral and hyperinflation, potentially ending the war more quickly, analyst says |
U.S. naval blockade on Iran will trigger a currency devaluation spiral and hyperinflation, potentially ending the war more quickly, analyst says
The U.S. blockade on ships entering or departing from Iranian ports went into effect on Monday, as President Donald Trump seeks to pressure Iran by cutting off its oil revenue.
The Iranian economy was already in shambles before the U.S. and Israel launched their war on the Islamic republic more than six weeks ago, and reports indicate the relentless bombing has pushed the regime to the brink.
Despite heavy losses Iran’s military has suffered, it still has enough missiles and drones to effectively close off the Strait of Hormuz while allowing its own oil tankers to go through. Tehran’s control of the narrow waterway is its most potent weapon as global energy markets reel from shortages, but a U.S. blockade could turn the tables.
“Leaning on this money machine sends the economy into a tailspin, giving the mullahs much needed motivation to negotiate in earnest,” Robin Brooks, senior fellow at the Brookings........