The Strait of Hormuz, *Petrodollar, and the Future of Global Power
By Major (R) Haroon Rasheed, a Defense and Strategic Analyst specializing in South Asian military dynamics, deterrence strategy, and defense modernization, and a member of the Research and Evaluation Cell for Advancing Basic Amenities and Development.
History demonstrates that no global power remains dominant forever. Empires rise, shape the world order according to their interests, and eventually face the limits of their power.
The British Empire, for instance, reached its zenith in the 19th and early 20th centuries, but its decline became evident after it lost control over the Suez Canal in 1956. That strategic chokepoint had been the lifeline of Britain’s global trade and influence; once it was threatened, the empire’s economic and political weight began to erode, accelerating its retreat from global dominance.
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Today, analysts draw a parallel with the United States. Just as the Suez Canal tested Britain, the Strait of Hormuz serves as the ultimate test for American global power. This narrow waterway is the artery through which a significant portion of the world’s oil and liquefied natural gas flows. Stability here underpins global energy markets, the strength of the U.S. economy, and the dominance of the petrodollar system, which requires oil to be traded primarily in the U.S. dollars.
Following the Cold War, the United States emerged as the unchallenged global superpower. Washington’s naval supremacy ensured that trade routes, especially the Strait of Hormuz, remained secure. This control allowed the U.S. to maintain the dollar as the world’s primary reserve currency, enforce its economic policies globally, and exert unmatched strategic leverage.
However, over the past two decades, the global balance of power has been shifting. China’s economic rise, Russia’s resurgence, and the growing influence of regional powers such as Türkiye, Iran, and India have challenged the U.S. unipolar dominance. In the Gulf region, rising tensions, missile capabilities, and asymmetric warfare have made the Strait of Hormuz increasingly vulnerable.
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Analysts warn that any prolonged disruption could shake the foundations of the petrodollar system, accelerating moves by oil-exporting countries to trade in other currencies—a shift that would rapidly weaken the U.S. economy and dollar’s global supremacy.
The stakes are clear
If the United States maintains control and succeeds in stabilizing the strait, the dollar will remain strong, the petrodollar system will survive, the U.S. economy will retain its resilience, and American global influence will endure. A strong outcome would also reinforce Donald Trump or any U.S. leadership in projecting international power.
If the United States fails or loses influence in the region, the consequences would be dramatic. The petrodollar system could crumble faster as nations begin trading oil in alternative currencies. The dollar would weaken, the U.S. economy would face immense stress, and American credibility would collapse. Such a scenario would accelerate the decline of the United States as a global superpower, creating a historical parallel to Britain’s retreat after the Suez Canal crisis.
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The situation also highlights the strategic importance of geopolitical geography. Just as the Suez Canal dictated Britain’s global influence, the Strait of Hormuz—and the flow of energy through it—may determine whether the American era continues or enters a phase of accelerated decline.
For countries like Pakistan and other middle powers, these developments have direct implications. Stability—or disruption—in this corridor affects energy security, trade flows, and economic stability across the wider region. Strategic foresight, balanced diplomacy, and regional cooperation will be essential to navigate these uncertain waters.
Conclusion
The American era is not ending overnight, but its future is precarious. Control over the Strait of Hormuz and the sustainability of the petrodollar system are likely to be decisive factors in determining the trajectory of the U.S. global power.
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A successful U.S. strategy would reinforce the dollar, protect the economy, and extend American influence. A failure, however, could weaken the dollar and destabilize the U.S. economy, undermine Trump or the administration in power, and accelerate.
CREDIT: Daniel Immerwahr.
America’s decline—much like Britain’s retreat after losing the Suez Canal.
History has shown that empires rise and fall around control of critical strategic chokepoints. In the 21st century, the world is watching whether the Strait of Hormuz becomes the defining test of American power—or the point at which the next great shift in global order begins.
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By Major (R) Haroon Rasheed, a Defense and Strategic Analyst specializing in South Asian military dynamics, deterrence strategy, and defense modernization, and a member of the Research and Evaluation Cell for Advancing Basic Amenities and Development.
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