The Strangulation of Iran: How Geography Is Defeating American Economic Warfare
By Matthew Parish
Sunday 15 November 2026
There is a curious feature of American foreign policy that becomes increasingly apparent whenever Washington decides to isolate a country economically. The United States is extraordinarily good at imposing sanctions, mobilising international banking systems, interdicting shipping and threatening secondary sanctions against governments and corporations that refuse to cooperate. She is rather less good at persuading neighbouring countries that they should destroy their own economies in pursuit of American geopolitical objectives. The latest confrontation over Iran illustrates this distinction with almost mathematical precision.
The United States is seeking to extend its economic blockade of Iran from the sea to the land, pressuring neighbouring countries to close their border crossings and restrict the movement of goods into and out of Iranian territory. Iraq, Turkey and Pakistan have resisted, although some crossings have been temporarily closed. Washington has established a military coordination body, Task Force Iron Gate, intended to disrupt the movement of prohibited goods and revenue across Iran's land borders and the Caspian Sea. The American ambition is clear: having already severely restricted Iran's maritime commerce, Washington intends to choke its remaining economic lifelines until Tehran makes political and military concessions.
The difficulty with this strategy is that Iran is not an island. It is a country of approximately 90 million people occupying one of the most strategically important geographical positions in Eurasia, with extensive borders connecting it to Turkey, Iraq, Pakistan, Afghanistan, Armenia, Azerbaijan and Turkmenistan. To the north lies the Caspian Sea, providing access to Russia and Central Asia. To the south lie the Persian Gulf and the Strait of Hormuz, through which a substantial proportion of the world's energy supplies ordinarily passes. Iran's geographical position is simultaneously its greatest strategic vulnerability and its greatest protection against economic isolation.
It is possible to blockade a port. It is considerably more difficult to blockade a mountain range, a desert, a network of ancient trading towns or a frontier inhabited by communities whose commercial relationships predate the existence of the modern states that supposedly govern them. The Americans are discovering that while international financial transactions can be interrupted by pressing buttons in Washington, the movement of trucks, livestock, petroleum products and agricultural commodities across thousands of kilometres of largely inhospitable terrain is a rather more complicated business.
The question is not merely whether Iran can survive an American economic siege. It is whether the United States can persuade an assortment of regional powers, many of them American allies, that the destruction of their longstanding commercial relationships with Tehran is worth the political, economic and security costs they would inevitably incur.
Saudi Arabia finds herself at the centre of this contradiction. For decades the kingdom was Iran's principal regional rival, the two countries competing for influence across the Middle East through religious establishments, political movements, intelligence organisations and proxy military forces. Riyadh supported governments and armed movements that opposed Iranian influence, while Tehran sought to extend its reach through Iraq, Syria, Lebanon and Yemen. Their rivalry was frequently described in confessional terms, as a contest between Sunni Saudi Arabia and Shia Iran, although its underlying causes were more conventionally geopolitical.
Yet the Saudis have become increasingly aware that perpetual confrontation with Iran is an expensive and ultimately unproductive exercise. The Chinese-brokered rapprochement between Riyadh and Tehran in March 2023 reflected a growing recognition that neither country could achieve lasting security by attempting to eliminate the other's regional influence. Saudi Arabia's ambitious economic transformation under Crown Prince Mohammed bin Salman requires sustained investment, infrastructure development, tourism and international commercial confidence. None of these objectives benefits from Iranian missiles flying over Saudi oil facilities or the perpetual threat that the Strait of Hormuz might be closed.
The American and Israeli military campaign against Iran, launched in February 2026, has made this dilemma even more acute. Iranian retaliation and the disruption of regional shipping have damaged the security arrangements upon which the Gulf monarchies have traditionally relied. Saudi Arabia has strengthened its defence relationships with Turkey and Pakistan while simultaneously participating in diplomatic initiatives aimed at preventing a wider regional war. These initiatives culminated in a series of meetings involving Egypt, Turkey, Pakistan and Saudi Arabia, including talks in Tehran in October.
This places Riyadh in the unenviable position of being asked to reconcile two fundamentally incompatible policies. The Americans want their regional partners to assist in strangling Iran economically, thereby increasing the pressure upon Tehran to abandon its nuclear ambitions, restrict its missile development and cease its support for armed groups across the Middle East. The Saudis, meanwhile, want Iran to behave more responsibly, but they also want a stable neighbour with which they can negotiate commercial and security arrangements. A weakened Iran may suit Saudi interests; a collapsing Iran, or one driven to desperation, could be considerably more dangerous.
Turkey presents an even more interesting problem. President Recep Tayyip Erdoğan has spent much of his political career demonstrating that membership of NATO does not necessarily entail obedience to the United States. Turkey purchases Russian energy, maintains substantial economic relationships with countries that Washington regards as adversaries and pursues its own geopolitical ambitions across the Caucasus, Central Asia, the Mediterranean and the Middle East. Ankara understands that its geographical position gives it a strategic importance that cannot readily be replaced by another American ally.
Iran is an important trading partner for Turkey, but it is also an essential element in the regional balance of power. A complete economic collapse in Iran could generate refugee movements, strengthen criminal organisations, disrupt energy supplies and create instability along Turkey's eastern approaches. Even an orderly change of government in Tehran would introduce considerable uncertainty into Turkish strategic calculations. Erdoğan may have little sympathy for the ideological ambitions of the Islamic Republic, but he has still less interest in permitting Washington to dictate Turkish economic policy at the expense of Turkey's own national interests.
Turkey's relationship with Iran is therefore an illustration of a more general principle of international relations. Countries do not necessarily like their neighbours, but they must live with them. America can change its policies towards Iran following an election, a change of administration or a shift in its military calculations. Turkey cannot move its eastern frontier. The same geography that made the Persian Empire a central feature of Eurasian politics thousands of years ago continues to make Iran an unavoidable participant in contemporary regional affairs.
Pakistan's position is perhaps even more delicate. Its western border with Iran runs through Baluchistan, a region of formidable geographical difficulties, longstanding insurgencies and extensive informal trading networks. Economic activity in these frontier communities often depends upon cross-border exchanges of fuel, food and consumer goods. The imposition of comprehensive restrictions would threaten livelihoods in regions where the authority of the central government is already contested. Islamabad must therefore consider not merely the consequences for its national economy but the possibility that American sanctions enforcement might contribute to domestic instability.
Pakistan also maintains an unusually complicated collection of strategic relationships. It has close military and financial ties with Saudi Arabia, longstanding relationships with China, a difficult relationship with Afghanistan and a persistent rivalry with India. It requires American cooperation in some areas but cannot afford to become entirely dependent upon Washington. Its relationship with Iran is one more element in a delicate diplomatic balancing act. Pakistan's willingness to assist in negotiations between Washington and Tehran should not be confused with willingness to participate in the economic destruction of its western neighbour.
Iraq, meanwhile, provides perhaps the clearest demonstration of the limitations of American coercive diplomacy. The Iraqi economy remains deeply dependent upon regional trade, and its electricity system has relied heavily upon Iranian natural gas. Its political establishment contains factions closely associated with Tehran alongside others seeking greater independence from Iranian influence. Religious pilgrimages and commercial exchanges create additional connections that cannot be severed without substantial social consequences. The Iraqi government is consequently being asked to take measures that could damage its economy, provoke domestic opposition and endanger its own political survival.
The irony is that Washington has spent more than two decades attempting to construct a stable Iraqi political order, only now to contemplate imposing economic demands that could help destabilise it. American policymakers may imagine that the closure of border crossings is a straightforward administrative exercise. Iraqi officials understand that a border crossing is not merely a road with a customs post at its end. It is the centre of an economic ecosystem comprising merchants, transport companies, agricultural producers, money changers, families and communities. To close such a crossing is to disrupt the lives of thousands of people who may have little interest in the nuclear ambitions of the Iranian government.
There is a further paradox in the American strategy. The more effectively Washington restricts legitimate commerce, the more profitable illicit commerce becomes. Economic blockades create enormous incentives for smuggling, corruption and the development of alternative trading networks. Governments may formally close crossings, but local officials, military officers and criminal organisations frequently discover that considerable fortunes can be made by allowing goods to pass unofficially. A strategy intended to deprive the Iranian state of resources may therefore strengthen precisely those opaque security and commercial networks that sanctions are supposed to weaken.
The history of economic warfare is full of such examples. Napoleon's Continental System, intended to exclude British goods from European markets, ultimately damaged the economies of France's own allies and encouraged widespread smuggling. Its increasingly coercive enforcement contributed to tensions with Russia and formed part of the background to Napoleon's disastrous invasion of 1812. The sanctions imposed upon Iraq during the 1990s inflicted immense suffering upon the civilian population without dislodging Saddam Hussein from power. More recently, the sanctions imposed upon Russia following its full-scale invasion of Ukraine have demonstrated both the economic costs that determined states can impose upon an aggressor and the ingenuity with which targeted governments seek alternative routes for obtaining prohibited materials.
Iran has had nearly half a century to develop the institutional habits of economic survival under sanctions. Its government has become adept at operating through informal financial channels, intermediary companies, alternative shipping arrangements and commercial relationships that bypass conventional Western banking structures. These arrangements are inefficient, expensive and frequently corrupt, but their very inefficiency can strengthen the political interests of those who control them. Sanctions may weaken a national economy without necessarily weakening the factions within a regime that command its military, intelligence and smuggling networks.
This does not mean that sanctions are necessarily ineffective or unjustified. Iran's nuclear programme, missile capabilities, support for armed organisations and record of domestic repression provide serious grounds for international concern. Its own attacks on neighbouring countries and threats to maritime commerce have contributed directly to the present crisis. Governments threatened by Iranian military capabilities have a legitimate interest in preventing the acquisition of weapons and technologies that could be used against them. The critical distinction is between restrictions designed to prevent identifiable military threats and attempts to make an entire civilian economy unviable.
That distinction raises important questions of international law. Targeted sanctions authorised by domestic legislation, measures adopted through the United Nations Security Council and a naval blockade maintained during an armed conflict are not legally interchangeable instruments. A blockade raises questions under the law of naval warfare, including its effectiveness, treatment of neutral shipping and humanitarian consequences. Economic restrictions imposed upon third countries raise separate issues of jurisdiction, sovereignty and international commercial obligations. The fact that the United States possesses sufficient economic and military power to enforce a particular policy does not, by itself, establish that every element of the policy is lawful or prudent.
The humanitarian consequences are equally important. Ordinary Iranians are already experiencing severe economic hardship, inflation and disruption to essential commercial supplies. Even where humanitarian exemptions formally exist, the closure of transport routes and interruption of banking arrangements can make it difficult to obtain medicines, medical equipment, food and industrial components. Economic devastation does not fall evenly upon a society. Wealthy and politically connected individuals often retain access to foreign currency and privileged supply networks, while ordinary families experience rising prices, declining purchasing power and the gradual destruction of their savings.
Nor is there any guarantee that such suffering will produce the political consequences Washington desires. The assumption that economic deprivation will induce a population to overthrow its government has repeatedly proved unreliable. Authoritarian governments can portray external economic coercion as evidence of foreign hostility, mobilise nationalist sentiment and blame outsiders for their domestic failures. A population struggling to obtain basic necessities may become less capable of organising effective political opposition rather than more capable of doing so. There is a difference between weakening a government and weakening the society over which that government rules.
This is one reason why Egypt's insistence upon dialogue deserves serious consideration. Cairo has no particular affection for Iranian regional ambitions, and its own strategic interests differ significantly from those of Tehran. Nevertheless, Egypt understands the economic consequences of prolonged instability in the Middle East. The Suez Canal remains one of the country's most important sources of foreign currency, and threats to shipping through the Red Sea and the Bab el-Mandeb strait directly affect Egyptian revenues. A wider regional conflict would also threaten energy supplies, food prices, investment and the economic stability of a country already facing formidable domestic challenges.
Egypt's diplomatic efforts therefore reflect calculation rather than sentimentality. Together with Turkey, Pakistan and Saudi Arabia, it has advocated negotiations and de-escalation while maintaining opposition to threats against regional security and freedom of navigation. The four countries have increasingly developed a framework for consultation that recognises their common interests without pretending that their national objectives are identical. Their discussions with European foreign ministers in Istanbul in October demonstrated that this emerging diplomatic mechanism extends beyond the immediate region.
What makes this development particularly significant is that it illustrates the gradual emergence of a regional diplomatic order less willing to accept American preferences as automatically decisive. For much of the period following the Second World War, the United States was the dominant external power in the Middle East. Its military guarantees, financial institutions, intelligence relationships and diplomatic influence permitted Washington to exercise an extraordinary degree of control over regional security arrangements. That influence has not disappeared, and it would be foolish to underestimate the continuing importance of American military power. Nevertheless, the willingness of regional governments to resist American demands demonstrates that their calculations are becoming more independent.
China and Russia form part of this changing environment. Both maintain substantial interests in Iran, although their motivations differ. China regards Iranian energy supplies and Eurasian transport corridors as elements of a broader strategy of economic diversification, while Russia sees cooperation with Tehran as a means of mitigating Western pressure and complicating American strategic calculations. Neither country is necessarily prepared to rescue Iran from every consequence of its policies, but both have incentives to prevent Washington from achieving unrestricted control over Iran's economic connections with the outside world.
For Ukraine, these developments carry consequences that deserve greater attention than they ordinarily receive. Iran has supplied technology that has contributed to Russia's ability to attack Ukrainian cities and infrastructure with drones. The degradation of Iranian military-industrial capabilities could therefore serve Ukrainian security interests. However, a prolonged Middle Eastern confrontation also threatens to divert American military resources, diplomatic attention and political energy away from Russia's war against Ukraine. Instability in global energy markets may strengthen Russian export revenues, while the fragmentation of international sanctions enforcement could create additional opportunities for Russian procurement networks.
Ukraine's interests are consequently not served automatically by the maximum possible escalation against Iran. They are served by measures that genuinely restrict the supply of military technology to Russia, preserve the international coalition supporting Ukrainian sovereignty and avoid destabilising the global economic arrangements upon which sustained Western assistance depends. The challenge is to distinguish between the strategic containment of a dangerous military partner of Russia and the pursuit of an unlimited economic confrontation whose consequences may prove unpredictable.
There is also a philosophical problem at the centre of the American approach. Economic coercion is most effective when the state imposing it has a clearly defined political objective, when the target understands what concessions are required and when there is a credible prospect that compliance will bring relief. If the objective is nuclear restraint, then an agreement establishing verifiable limits and inspection arrangements is conceivable. If the objective is to reduce Iranian missile capabilities, the negotiations become more difficult but are not necessarily impossible. If the objective is to eliminate Iran as an independent regional power, however, then the demand is not one that any Iranian government could realistically accept.
The danger is that economic pressure gradually becomes an end in itself. Sanctions are imposed because previous sanctions have failed to produce the desired result, and each successive failure is interpreted as evidence that stronger sanctions are required. Eventually the coercive apparatus acquires its own institutional momentum, with military commands, intelligence organisations, financial regulators and diplomatic missions all dedicated to administering a policy whose political purpose has become increasingly obscure. The machinery of economic warfare continues to expand even as the prospects of achieving a negotiated settlement diminish.
It is worth remembering that Iran was a major civilisation long before the United States existed. Its commercial relationships with Mesopotamia, Anatolia, Central Asia and the Indian subcontinent stretch back thousands of years. Modern customs barriers and international financial regulations can interrupt these connections, but they cannot erase the underlying geography that created them. Goods will continue to move along routes determined by economic necessity, human ingenuity and the practical interests of neighbouring populations. The greater the obstacles placed in their way, the greater the financial rewards for those prepared to circumvent them.
This is ultimately why Saudi Arabia, Turkey, Pakistan and Egypt are reluctant to permit the complete economic strangulation of Iran. Their governments may distrust Tehran, fear its military capabilities and object to its regional ambitions, but they understand that the Iranian state cannot simply be wished away. A devastated Iran would remain their neighbour, and its instability would spill across their frontiers long after the American administration responsible for the blockade had departed office.
The United States possesses an immense capacity to inflict economic damage, but inflicting damage is not the same thing as achieving a strategic objective. Successful foreign policy requires an understanding of what happens after the pressure has been applied, how the targeted government is likely to respond and whether the supposed beneficiaries of the policy genuinely wish to live with its consequences. The Middle East is littered with the remains of grand strategies that were impressive in Washington and considerably less impressive to the people obliged to inhabit their results.
The emerging resistance to the closure of Iran's land borders is therefore more than a disagreement about customs posts or commercial traffic. It is a contest between a conception of international politics based upon coercive economic power and another based upon the stubborn realities of geography, proximity and mutual dependence. Washington can impose extraordinary costs upon Iran, but it cannot easily persuade Iran's neighbours to sacrifice their own prosperity and security in the process.
The Americans may control the seas surrounding Iran, much of the international banking system and a formidable proportion of the world's military power. They do not control the mountains of Anatolia, the deserts of Baluchistan or the commercial instincts of the merchants of Mesopotamia. Those are rather older institutions than the United States Department of the Treasury, and they have a considerable record of surviving empires.
The real test of American diplomacy will not be whether it can compel another frontier crossing to close. It will be whether Washington can devise a settlement in which the governments that must live alongside Iran have a greater interest in maintaining peace than in evading the economic consequences of an American blockade. Until that happens, the trucks will continue to find their way across the mountains, and the merchants will continue to discover that geography is sometimes more powerful than geopolitics.
