Energy is America’s real weapon in a multipolar world

Asia Times | Bob Savic

The United States leverages strategic influence over global oil and gas supplies to maintain dollar primacy and Treasury demand in an emerging multipolar world. Following the February 2026 conflict with Iran that closed the Strait of Hormuz and pushed Brent crude to $118 per barrel in March, Washington demonstrated how energy disruptions reinforce American financial authority.

Energy security underpins dollar dominance. While Venezuelan interventions secured potential access to over 65 billion barrels of reserves, the severing of Russian pipeline flows forced Europe into deeper dependency on US liquefied natural gas. Despite US gasoline reaching $4.60 per gallon in May 2026, energy-importing economies absorbed much harsher systemic shocks. In response, China expanded installed solar capacity to 1,286 GW by July 2026, narrowly surpassing its 1,285 GW coal capacity while retaining coal for 49.7% of power generation. This widening friction over maritime chokepoints ensures global energy security remains heavily contested.

Comment

Weaponising maritime transit nodes like the Strait of Hormuz shifts the financial burden of energy security from naval escorts to capital markets. During supply disruptions, soaring spot prices directly force foreign central banks to expand emergency dollar liquidity reserves. This dynamic transforms sea-lane vulnerability into net demand for long-dated US Treasury debt. Navies patrolling these choke points effectively underwrite the financial primacy of the issuing sovereign.

The second-order consequence hits energy-importing states through compounded fiscal friction rather than immediate naval deficits. Nations reliant on Gulf crude face simultaneous currency depreciation and heightened import costs, draining external reserves faster than domestic subsidies can buffer. Consequently, strategic autonomy for energy importers degrades faster through capital flight to US Treasuries than through direct interdiction in the Strait of Hormuz.

Strategic Question for Discussion

If persistent instability in the Strait of Hormuz continues to drive global capital into US Treasuries, which factor will dictate the resilience of net-importing economies first — foreign exchange reserve depletion or domestic energy subsidy limits?

The available evidence points toward foreign exchange reserve depletion as the primary failure point for vulnerable import-dependent states. While domestic energy subsidies can temporarily cushion retail price shocks, rapid capital flight into US Treasuries accelerates currency devaluation and severely narrows sovereign borrowing capacity. Consequently, the fiscal ceiling is likely to be breached in central bank reserves long before physical energy stocks are exhausted.

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