10th August 2026
Trump's Middle East Strategy Is Starting to Unravel – And the World Is Paying the Price
Donald Trump came back to the White House promising something that many Americans and much of the world desperately wanted:
an end to America's endless wars.
His approach was supposed to be different.
Instead of allowing conflicts to drag on indefinitely, Trump would use America's enormous military and economic power to force the parties towards deals.
It was a powerful proposition.
But the events of the past few days suggest that the reality may be considerably more complicated.
Israel has rejected Trump's proposed Gaza settlement.
Iran is demanding major concessions before agreeing to reopen the Strait of Hormuz.
And attacks on Saudi energy infrastructure threaten to widen the conflict still further.
The uncomfortable question is therefore becoming:
Is Trump's Middle East strategy beginning to unravel?
This is not necessarily a defeat for Trump
It would be too early to say that Trump has lost control of the situation.
America remains by far the most powerful military force in the region.
Trump also has enormous economic leverage.
And negotiations with Iran over Hormuz could still produce an agreement.
But something important has changed.
The countries involved are increasingly demonstrating that they can say no to Washington.
That matters enormously for Trump's strategy.
His political strength depends partly on convincing allies and adversaries that American pressure will eventually force them to compromise.
If that assumption begins to disappear, America's leverage becomes less powerful.
Israel says no
Trump's proposed Gaza plan was intended to provide a route towards ending the conflict and beginning the reconstruction of the territory.
But Israel has rejected the idea of withdrawing from Gaza before Hamas is disarmed.
That is not a minor disagreement.
It goes to the heart of the problem.
Trump wants a political settlement.
Israel's government says it cannot accept a settlement that leaves Hamas capable of attacking Israel again.
So the American president faces a familiar Middle Eastern problem:
How do you persuade two sides to accept an agreement when their definition of security is fundamentally different?
Trump can apply enormous pressure.
But he cannot simply order Israel to withdraw.
That is a crucial distinction between American power and American control.
Iran is playing a different game
The Strait of Hormuz is arguably an even bigger test of Trump's strategy.
Iran has indicated that an agreement with Oman concerning the reopening of the waterway is close.
That sounds encouraging.
But Tehran has simultaneously presented conditions including demands concerning the US blockade and compensation for war damage.
In other words, Iran is not simply saying:
"We surrender."
It is saying:
"We will negotiate — but we want something in return."
That is a very different proposition.
Iran knows how important Hormuz is to the world economy.
It knows that reopening the strait would be welcomed by oil-importing countries.
And it knows that the longer the disruption continues, the greater the pressure becomes on governments and businesses around the world.
That gives Tehran something valuable:
leverage.
Hormuz is the economic heart of the crisis
The Strait of Hormuz is only about 54 kilometres wide at its narrowest point.
Yet around 20 million barrels of oil a day passed through it during 2025.
That represented roughly a quarter of global seaborne oil trade.
It is also crucial for LNG.
The IEA estimates that around 93% of Qatar's LNG exports and 96% of the UAE's LNG exports pass through the strait.
This is why the conflict is not merely a Middle Eastern political story.
It is a global economic story.
If Hormuz remains disrupted, the consequences can spread through:
oil → transport → manufacturing → food → inflation → interest rates → economic growth.
And Britain is not immune.
The world has very little spare capacity to replace Hormuz
There are alternative pipelines through Saudi Arabia and the UAE.
But their combined capacity is nowhere near enough to replace the normal volume passing through the strait.
That means there is no simple switch that can be turned on if Hormuz remains closed.
The world therefore depends heavily on the waterway.
And that gives Iran enormous strategic importance even though Iran itself is facing extraordinary pressure.
Then the Houthis enter the picture
Just as Washington is trying to negotiate with Iran, the wider regional conflict refuses to remain contained.
Houthi forces have continued threatening and attacking Saudi energy infrastructure.
That introduces another problem.
Even if Trump reaches an agreement with Iran, can he guarantee that every armed group in the region will respect it?
That is much harder.
The Middle East contains governments, militias, armed movements and regional powers whose interests overlap but are not identical.
The United States can negotiate with governments.
It cannot necessarily negotiate away every conflict between armed groups.
And that is one reason the current situation is so dangerous.
The danger of a conflict nobody controls
The most worrying scenario may not be a massive new war.
It could be something much more difficult to manage:
a conflict that never quite ends.
Ships are attacked occasionally.
Oil installations are hit.
Hormuz remains partially restricted.
Negotiations take place.
Then negotiations break down.
Oil prices rise.
Then they fall again.
Insurance premiums increase.
Shipping companies reroute vessels.
Businesses delay investment.
Governments release emergency reserves.
And the world economy becomes accustomed to geopolitical instability.
That may be more damaging over the long term than one short military confrontation.
And this is where oil becomes critical
The world has spent years trying to reduce its dependence on fossil fuels.
But the current crisis demonstrates something uncomfortable.
The world still needs enormous quantities of oil.
Electric cars are growing rapidly.
Wind and solar are expanding.
Nuclear power is returning to favour.
But aircraft still need aviation fuel.
Ships still use oil-based fuels.
Heavy machinery remains dependent on petroleum.
Petrochemicals are used in everything from plastics to medicines.
Agriculture depends heavily on oil and gas.
And millions of conventional vehicles remain on the world's roads.
The energy transition is happening.
But it has not happened yet.
Britain is particularly exposed to the consequences
For British households, the effects of a prolonged Middle Eastern energy crisis could eventually appear in familiar places.
Petrol and diesel prices could rise.
Heating costs could increase.
Food prices could come under pressure because farming and transport are energy intensive.
Air fares could rise.
Businesses could face higher costs.
Inflation could become more persistent.
And if inflation remains high, interest-rate cuts become harder for central banks.
That creates an uncomfortable chain reaction:
Middle East conflict → higher oil → higher inflation → higher interest rates → weaker growth.
This is why an apparently distant conflict can eventually affect a household in Scotland.
The irony for Trump
Trump's political message has always emphasised putting America first.
And the United States is considerably less dependent on Middle Eastern oil than it once was because American domestic production has increased dramatically.
But the oil market is global.
America does not have to import Middle Eastern oil to be affected by Middle Eastern oil prices.
If a shortage pushes Brent crude sharply higher, American consumers and businesses feel it too.
And so does Britain.
And Europe.
And India.
And China.
The world economy remains connected even when individual countries become more energy independent.
China and India may be watching particularly closely
There is another reason this crisis matters.
Most of the oil passing through Hormuz is ultimately heading towards Asia.
The IEA says around 80% of the oil moving through the strait is destined for Asian markets, with China, India and Japan among the major importers.
That means the current crisis is not simply an American-Iranian confrontation.
It is also an enormous economic problem for Asia.
And this could have geopolitical consequences.
China in particular has been working to reduce its vulnerability to energy shocks.
That makes the Middle East crisis another argument for China to accelerate investment in:
renewable energy;
nuclear power;
electric vehicles;
batteries;
domestic energy production;
and alternative trade routes.
The same applies to India.
Could Trump actually emerge stronger?
There is another side to the story.
Trump could still surprise his critics.
If he succeeds in negotiating a genuine reopening of Hormuz, secures an agreement over Gaza and prevents the conflict spreading further, he could claim exactly what he promised:
America used pressure to force peace.
That would be a major political victory.
It would also demonstrate that Trump's unconventional negotiating style can work even in extraordinarily complicated conflicts.
So it is far too early to write his strategy off.
But there is a major difference between pressure and control
This may be the most important lesson.
America can bomb military targets.
It can impose sanctions.
It can threaten economic consequences.
It can deploy aircraft carriers and troops.
It can offer diplomatic agreements.
But it cannot necessarily make other governments accept American solutions.
Israel has its own security priorities.
Iran has its own strategic objectives.
The Gulf states have their own economic interests.
The Houthis have their own agenda.
And China, India, Russia and Europe are all watching and calculating their own interests.
The Middle East is not a chessboard on which Washington controls every piece.
That may be the reality Trump is now discovering.
What happens if Trump cannot deliver?
The consequences could be considerable.
America's allies may begin questioning how much they can rely on Washington.
Adversaries may become more willing to resist American pressure.
Countries may accelerate efforts to diversify their energy supplies.
Governments may increase strategic oil reserves.
Companies may reconsider global supply chains.
Shipping companies may avoid vulnerable routes.
And investors may demand a higher risk premium for doing business in politically unstable regions.
The result could be a world economy that becomes permanently more expensive.
The end of cheap globalisation?
This may ultimately be the biggest story.
For decades, companies could concentrate production where it was cheapest.
Energy could be bought from wherever it was cheapest.
Goods could travel enormous distances.
Shipping routes were assumed to remain open.
Geopolitical risk was often treated as a temporary inconvenience.
The last few years have challenged all of those assumptions.
Covid disrupted supply chains.
Russia's invasion of Ukraine transformed European energy markets.
The Middle East conflict is threatening another major energy chokepoint.
Countries are increasingly asking:
"What happens if our cheapest supplier suddenly becomes unavailable?"
That question is changing business decisions around the world.
Energy security is becoming as important as energy cost
This connects directly to Britain's own energy debate.
For years, the emphasis was largely on reducing the cost of energy and reducing carbon emissions.
Now there is a third consideration:
security.
A source of energy that is cheap but vulnerable to geopolitical disruption may not actually be cheap.
A source that is slightly more expensive but domestically produced and reliable may have strategic value.
This is one reason Britain is simultaneously debating North Sea oil and gas, offshore wind, nuclear power, storage and other technologies.
It is also why our recent discussion about whether Britain could ever reconsider domestic coal is more relevant than it initially appeared.
Energy policy is ultimately about managing risk.
So is Trump's Middle East strategy unravelling?
Perhaps.
The evidence certainly suggests that Trump has not been able simply to impose his preferred solutions.
Israel has rejected his Gaza proposal.
Iran is attaching conditions to the reopening of Hormuz.
Houthi attacks threaten to spread the economic consequences.
And the wider region remains unpredictable.
But there is still time for Trump to turn the situation around.
The critical test will be whether he can convert America's enormous military and economic power into agreements that the other parties actually accept.
That is much harder than making threats.
And where does this leave the world?
Perhaps in a more dangerous position than it was a few years ago.
The world is becoming less willing to depend on a single country, a single supplier or a single trade route.
Energy security is returning to the centre of economic policy.
Governments are rebuilding strategic reserves.
Businesses are diversifying supply chains.
Countries are investing in domestic energy.
And the transition away from fossil fuels is accelerating partly because governments now recognise that renewable and nuclear energy are not only climate technologies.
They are security technologies.
The ultimate irony may be that the current Middle East crisis accelerates the energy transition that the world has been debating for decades.
Every oil shock strengthens the economic case for electric vehicles.
Every gas crisis strengthens the case for renewable energy and nuclear power.
Every shipping disruption strengthens the case for domestic production.
And every geopolitical crisis reminds governments that energy independence has a value that cannot always be measured on an electricity bill.
Trump may yet succeed in bringing the current crisis under control.
But if he doesn't, the consequences will extend far beyond his presidency.
The world may be entering a new era in which geopolitical security, energy security and economic security are no longer separate issues — they are the same issue.