The diplomatic pause with Iran is over. President Donald Trump has ditched the Memorandum of Understanding to reinstitute a full naval blockade of the Strait of Hormuz, but with a new twist: he demands a 20% toll on shipping and declares the U.S. the “Guardian of the Strait.” On Breaking Points, Saagar Enjeti argued this move completely undermines the legal high ground the State Department held for years, shifting the argument from freedom of navigation to who collects the check.
Iran’s foreign minister agreed with the logic of a toll but mocked the price. Tehran had offered a 1% fee; Trump wants 20%. Trita Parsi, executive VP of the Quincy Institute, contended the previous ceasefire failed because Trump needs a constant stream of wins to stay at the table. When momentum slowed, he reverted to escalation. The fundamentals remain unchanged: Iran can threaten Hormuz, the U.S. can punish Iran, but neither can secure objectives through force.
"We are back to a tit-for-tat war where neither side can win through force."
- Trita Parsi, Breaking Points
The economic safety net is gone. The Strategic Petroleum Reserve is at minimal operating levels and is expected to dip further within two weeks. Saagar Enjeti warns the market is incredibly brittle; if China resumes normal buying or a hurricane hits Houston, gas prices could spike to $8 a gallon almost instantly. The U.S. is betting it can keep the conflict simmering without voters feeling the true cost, but Trita Parsi points out Tehran is intentionally dragging negotiations to let the global economy bleed, believing it has a higher pain tolerance than American voters during a midterm cycle.
Intelligence agencies grew desperate enough to try the absurd. A New York Times investigation detailed an Israeli plot to cultivate former Iranian president Mahmoud Ahmadinejad - known for bellicose rhetoric and Holocaust denial - as a pro-Western asset. Mossad agents met him secretly worldwide. When the U.S. bombed his residence earlier this year, the covert goal was reportedly to kill his IRGC guards so agents could smuggle him to a black site to lead a coup. The plan fell apart when Ahmadinejad changed his mind and returned to regime protection.
"This was the Moby Dick of all flips. It reveals a fundamental misunderstanding of the Iranian power structure."
- Trita Parsi, Breaking Points
The failure leaves the U.S. and Israel with no viable path to regime change from within. Instead of a surgical coup, they are locked in a grinding war of attrition neither seems prepared to end. Trump greenlit strikes by Saudi Arabia on Yemen, potentially opening another front and threatening a blockade of the Bab al-Mandeb Strait, while global oil inventories recovered only 5% during the recent memorandum, shortening the U.S. runway for war-induced economic crisis. The administration’s strategy assumes it can sustain a high-intensity naval conflict without crashing the global economy, but the vanished oil reserve means it has no cushion left to manage a sudden supply shock.
