End of the petrodollar? How Iran war is reshaping the global economy

March 22, 2026

AMY GOODMAN: This is Democracy Now! I’m Amy Goodman, with Nermeen Shaikh.

NERMEEN SHAIKH: Global oil and natural gas prices are soaring after Israel bombed a massive natural gas reserve in Iran, the largest in the world. Iran retaliated by twice attacking the world’s largest liquid natural gas production facility, located in Qatar.

Iran also attacked key energy infrastructure in Saudi Arabia, Kuwait and the United Arab Emirates. At one point, the price of oil reached US$118 a barrel, a 60 percent jump since the US and Israel launched their war on Iran.

In a post online, Trump threatened to blow up the entire South Pars gas field if Iran continued to target the Qatari facility. Trump also claimed the US, “knew nothing” about the Israeli attack on the South Pars gas field, but The Wall Street Journal reports Trump approved the strike to pressure Iran to open up the critical Strait of Hormuz.

AMY GOODMAN: About 20 percent of the world’s oil exports flows through the Strait of Hormuz. President Trump has asked other countries to send warships to help force open the strait, but many nations are rejecting the request.

We’re joined now by Laleh Khalili, professor of Gulf studies at University of Exeter and the author of several books, including her latest, Extractive Capitalism: How Commodities and Cronyism Drive the Global Economy. She also wrote Sinews of War and Trade: Shipping and Capitalism in the Arabian Peninsula.

Professor Khalili, thanks so much for being with us. Can you start off by talking about the state of the Strait of Hormuz right now, its closure; President Trump, according to Reuters, perhaps sending in thousands of troops, what exactly this means; and the Israeli bombing of the South Pars gas field, the largest in the world?

President Trump said, in a rare rebuke, the US didn’t know. Most people are saying that is highly unlikely, that is probably untrue.

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The end of the petrodollar? Video: Democracy Now!

Transcript:

LALEH KHALILI: So, the Strait of Hormuz is one of the most important choke points for oil — a choke point being an area during which, if it’s closed down, you end up getting a major disruption in the flow of global trade.

So, the Strait of Hormuz is one. The Suez Canal is another one. The Panama Canal is another one.

And there are a number of these different choke points all around the world. Now, what’s specific about Hormuz and what’s distinctive about it is that it is the choke point where the quantity of oil that goes through is higher than any other commodity that actually flows across the strait.

As you just mentioned, about 30 percent of the global oil flows through that. And part of the reason for that is, of course, that the world’s biggest oil producers — some of the biggest oil producers are all sitting around the Persian/Arabian Gulf, so Iran, Iraq, Kuwait, Saudi Arabia and Qatar, Abu Dhabi, which all are huge producers of oil in the first place, and then natural gas in the case of Qatar and Iran in second place.

Now, what has been fascinating is that anybody who has one of these apps that you can put on your phone, like MarineTraffic or VesselFinder, you can actually take a look at the flow of traffic, the flow of vessel traffic, flow of ship traffic, through these different seas in the world.

And if you zoom in on the Strait of Hormuz, what you’ll find is that instead of seeing actually a steady traffic of little usually pink or green arrows going through, which indicate tankers, what you end up seeing are major clusters of ships that are bunched up very near ports where oil is produced and usually put on ships.

What that indicates is that, basically, for a number of different reasons — and I’m going to go into that in a minute — the flow of ships, the flow of ship traffic, has basically come to a halt.

Now, the reasons behind this are multifold. Of course, there is, number one, that Iran is attacking a number of the ships that are going through, and the way that it’s attacking them is through the use of very cheap either drones or sea mines, and that means that it’s basically almost impossible to deal with this particular threat, because the drones are produced so extensively in terms of number and they’re so inexpensive that they can basically be replenished even if they are destroyed.

Also being smaller, they’re much harder to target, etc. So, there has been a number of drone attacks against ships carrying oil through the channel, and so, of course, that scares a lot of carriers, a lot of tankers.

The second reason, which I actually think is perhaps even more significant, in part because it is actually not something that either the US or Iran can control, is that the moment something like this happens, the moment that there is a threat against ships, what you end up having is that insurance brokers, primarily situated in London, but there are, of course, some also in the US, China and in Europe, but really the centre for provision of maritime insurance is London, at Lloyd’s, and the ship brokers end up putting a specific war risk premium on ships.

And that means that going from something like 1 percent of the cost of the hull, meaning the ship’s body, or the cargo, meaning what it’s carrying, goes to something like 5 percent, or it goes from one fraction of 1 percent to, say, 5 percent. So that means that suddenly, instead of paying in the hundreds of thousands for insurance for a super tanker, what you’re looking at is millions in insurance, which, of course, increases the cost of the oil that is traveling. So, that’s the second reason.

The third reason is something that the Houthis noticed when they were blockading the Red Sea in support of the Palestinians when Israel was committing genocide against Palestinians. And that is that sometimes the threat alone suffices in getting the ships to stop going through or, indeed, to make declarations that allows for them a degree of protection.

So, the Houthis, when they had blockaded the sea, had asked that any ships that claimed that they were not touching Israel, meaning they were not delivering to or picking up from Israel, could be allowed to go through the canal.

And so, it happened that this automatic identification system that a lot of ships — well, all ships carry — it’s called the AIS system, and the AIS system indicates what ship is in the vicinity of the system, what it’s carrying and what flag it has, meaning which authorities it responds to.

So, now what we’re seeing is that apparently Iran has mentioned that any ship, for example, that is going to China will be let through, or any ship that is not coming from one of these allied states to the US will be allowed through. Of course, there is a lot of variation in what kind of thing they have requested or what is being reported, so it’s a lot harder to see what exactly the AIS systems are being on these ships.

As I said, we are mostly seeing them clustering and waiting in these locations, one of the main ones being the Port of Fujairah, which is actually not in the Persian Gulf. It is in the Gulf of Oman.

And oil from Abu Dhabi, which is on the Persian Gulf side, is shipped to Fujaira through a pipeline. So we’re seeing a cluster of ships near Fujaira.

Iran, of course, also attacked Fujaira port. And then we’re seeing a cluster of ships near Ras Laffan, which is the main gas production and gas lifting port in Qatar. The third is, of course, around the oil fields of Saudi Arabia, a little bit further up the Persian Gulf. And so, these clusters of ships are waiting there and hoping to be able to at some point pick up oil to be carried out.

But we’re not seeing much of that flow anywhere at all.

NERMEEN SHAIKH: Professor Khalili, you mentioned that there are — they are looking for, the Iranians, to see which vessels in the Strait of Hormuz — to what countries they’re affiliated, looking at their flags. Chinese vessels have reportedly been permitted to pass through the strait. China imports about 40 percent of its oil from the Middle East and has been one of the largest buyers of Iranian oil. There are also reports that the Iranians are suggesting they’d consider allowing a small number of oil tankers to pass through the strait if the oil cargo is traded in Chinese yuan rather than —

LALEH KHALILI: Yes.

NERMEEN SHAIKH: — US dollars. If you could comment on that?

LALEH KHALILI: This is really fascinating, because, of course, we know that the fundamental basis of the US imperial order since the end of the Second World War has been, on the one hand, petroleum and, on the other hand, the US dollar. The globe’s production and finance worlds are dependent on the petroleum that the US has guaranteed the flow of since the end of the Second World War, and which, until the nationalisation of oil in the 1970s and 1980s, basically controlled something like 60 percent of the world’s oil reserves.

After nationalisation, that percentage dropped dramatically, but the US dollar continues to be, and the financial channels that the US has crafted, continue to be a very significant bolster for the empire.

So, the fact that Iran is actually looking for alternatives to the dollar in order to challenge the petrodollar regime, which is, you know, as I said, one of the fundamentals of the US empire, is a really interesting and quite clever indication of how the Iranians are hoping to influence the crafting of a world post this war, or a new world order post this war, where there’s a multipolar financial system, where, for example, the dollar is no longer a single currency that rules the world and the US is the only channel that controls — or, the only power that controls financial channels, because, of course, the US has used this inordinate power to strong-arm various states, to institute sanctions, to make it difficult for its enemies, for example, to purchase oil.

And, of course, it has used it to coerce a lot of countries, as we see, for example, in the case of Cuba or Iran, or indeed Russia, to do its bidding. So, the fact that Iran is calling for petroyuans to become an alternative to petrodollars is actually quite significant also in indicating that the Iranians are well aware of how extensively the US has used its coercive sanction capabilities, through its control of the financial channels and through its mastery of the petrodollar, and are trying to erode that power.

NERMEEN SHAIKH: Professor Khalili, you know, the US is now the world’s largest oil producer, but because oil is a globally priced commodity, the price goes up in the US if the world market price goes up. But —

LALEH KHALILI: That’s right.

NERMEEN SHAIKH: — how important do you think this might be in Trump’s calculation? Because another consideration, another aspect of this, may be that as oil supplies diminish from the Middle East, the US could benefit, because it is the world’s largest oil producer, and the price of its oil will go up, and the demand for its oil.

LALEH KHALILI: Absolutely. What a fantastic question, because, in fact, we have seen that when the Russian invasion of Ukraine began and the Nord Stream gas, natural gas, pipelines to Europe were sabotaged, we now — there are now indications that this may have been done at the behest of the US.and its Ukrainian allies. But nevertheless, when that sabotage happened, it actually translated into massive gains for US natural gas production.

The thing is that there are a number of reasons why oil is not — why the US cannot become the sole oil producer for the whole of the world. One is the question of proximity, for example. The second is the question of capacity that the US has in order to actually replace, for example, the oil that is produced by Saudi Arabia or by Iran or, indeed, by Russia.

But the third factor — and I think that this is the one that I think we should look out for — is that in the last 10 or 15 years, China has actually begun generating an alternative set of fuels, sustainable fuels, and developing technologies, particularly of electric and battery technologies, that will allow for, for example, solar or wind energy to displace fossil fuels.

And the more that the price of oil goes up, which, of course, we’ve seen that happen, as you mentioned earlier — and, in fact, this also translates into major windfalls for US oil companies. This oil prices going up benefits Chevron. It benefits Exxon. It doesn’t benefit the average US citizen at the petrol stations, at the gas stations, but it does benefit the oil companies.

So, it definitely does — that does happen. But the higher the price of oil goes up, the relatively cheaper it becomes to actually have sustainable alternatives, which, of course, that means that it benefits China in a major way, since China is way ahead of the rest of the world in producing these technologies and in producing them cheaply.

The solar panels that are being produced in China are a fraction of the price of solar panels that were being produced something like 15 or 20 years ago. And I think this shift is actually a major long-term concern for the oil companies.

In the short term, they’re taking all the windfall that they can get. But this, again, is — the kind of a postwar order that will likely also have major implications for the kind of energy people are paying to use or people are willing to use, actually.

AMY GOODMAN: We just have 20 seconds. But the effect of the bombing of the South Pars facility, the largest gas facility in the world, what it means for Iran, what it means for the world, and President Trump denying the US had anything to do with, which most do not believe?

LALEH KHALILI: No, absolutely not. There is no way that Israel would have actually done this without coordination with the United States. And, in fact, the channels that deny, for example, that the US coordinated, or report Trump’s denials, are the channels that are often used to feed us the kinds of lies that the administration tells us.

But what is quite significant about South Pars — and I know it’s a very short time left, so I’m going to be very quick about it — is that the South Pars field is actually shared between Iran and Qatar.

The North Dome, which is on the south part of the Persian Gulf, is Qatar’s share of this major field, and Iran’s bit is in the northern part of the Persian Gulf.

And so, the destruction of the infrastructure there will not only have an effect on Iranians’ ability to produce electricity and fuel their various kinds of industries and/or homes, but it will also have an effect on the infrastructures that are used by the Qataris and which the Iranians and Qataris have been using in an extraordinary degree — to an extraordinary degree of coordination since the fields have been used. So, this actually also affects Qatar.

The bombing itself also affects Qatar. And I don’t think that this is a calculation that the rather know-nothing Trump administration has taken into account.

AMY GOODMAN: Laleh Khalili, we want to thank you so much for being with us, professor of Gulf studies at University of Exeter, author of several books, including her latest, Extractive Capitalism: How Commodities and Cronyism Drive the Global Economy. Thanks so much for being there.

Republished from Democracy Now! under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 United States Licence.

Article by AsiaPacificReport.nz

Wenda condemns ‘cruel’ arbitrary arrests of West Papuans in Tambrauw

By Asia Pacific Report -

March 21, 2026

Asia Pacific Report

An exiled leader of the United Liberation Movement for West Papua (ULMWP) has condemned Indonesia’s “cruel and humiliating” arbitrary arrest of 12 West Papuan local farmers in Tambrauw Regency this week and has demanded their release.

According to Human Rights Monitor, the arrests took place on March 18, after Indonesia conducted military operations in the Fef and Bamus Bama districts.

People were dragged out of their homes, tortured, and detained without any warrants or explanation.

“This is how Indonesia treats West Papuans, as less than human,” said ULMWP interim president Benny Wenda in a statement.

“The 12 men arrested in Tambrauw have been labelled TPNPB [West Papua National Liberation Army] and stigmatised as terrorists and criminals by the Indonesian colonisers.

“But who is the real terrorist? These men are the customary landowners, simply defending their forest, their homes, from the military who come to destroy everything.”

Wenda said the Indigenous people had been living there for thousands of years — “long before Indonesia invaded and stole our sovereignty.”

He added: “They didn’t go to Jakarta; Indonesia came to them with bombs and guns.”

Indonesia ‘stolen our resources’
Wenda asked who was the real criminal.

“The people of Tambrauw have been tending their gardens in peace for generations. It is Indonesia who has come and stolen our resources, torn down our forest to plant rice and sugar so people in Jakarta can eat.

“There is no real development in West Papua, only business for Indonesia.”

Wenda said that when he looked at the pictures of the arrested Papuans with their hands tied, forced face down on a police station floor, he saw his own people.

“They represent all West Papuans — humiliated and degraded in their own land.”

Wenda said Indonesia could never defeat the Papuan spirit.

“You can arrest us, torture us, kill us, but the spirit of freedom lives on in every West Papuan,” he said.

Experienced trauma
“Whether they are in the bush, the city, in exile, or even working in the Indonesian government, every West Papuan has experienced trauma at the hands of the Indonesian military and police.

“Every single one of us has an uncle who has been killed, a mother who has been raped, or a brother who has been tortured in police custody.

“We all long for merdeka [freedom]. That is why Indonesia has deployed over 80,000 security forces to terrorise our land — because they are terrified of our desire for freedom.”

As well as demanding that the 12 Papuans be released, Wenda said Indonesia must also finally allow foreign journalists to report on West Papua and immediately facilitate a visit to West Papua by the United Nations High Commissioner for Human Rights.

Such a visit has been promised since 2018, and demanded by 113 countries, including all member states of the Pacific Islands Forum (PIF), Organisation of African, Caribbean, and Pacific States (OACPS), and the European Commission.

Article by AsiaPacificReport.nz

Israel – the parasite state sabotaging peace in the Middle East

By Asia Pacific Report -

March 21, 2026

COMMENTARY: By Marcus Alexander

In a stunning resignation that has sent shockwaves through Washington, former National Counterterrorism Center Director Joe Kent has exposed what many have long suspected but few have dared to state publicly — Israel is systematically undermining peace in the Middle East to serve its own expansionist agenda.

Joe Kent, a 20-year Army Special Forces veteran and Gold Star husband who lost his first wife in a Syria suicide bombing, didn’t mince words. His accusation is simple yet devastating: Israel is intentionally sabotaging diplomatic solutions because peace threatens its strategic objectives.

The most compelling evidence supporting Kent’s claim is the targeted assassination of Ali Larijani, Iran’s National Security Adviser and chief nuclear negotiator.

According to Kent, Larijani wasn’t just another Iranian official — he was actively engaged in negotiations that could have de-escalated regional tensions.

“Larijani was eager to get us a deal,” Kent revealed in an interview with Tucker Carlson.

But instead of pursuing diplomacy, US-Israeli strikes eliminated him, along with his son and several staff members. The message could not be clearer — anyone willing to negotiate for peace becomes a target.

This wasn’t just another military operation. Larijani represented the pragmatic wing of the Iranian establishment — someone capable of conducting the sorts of talks needed to end conflicts.

By eliminating him, Israel ensured that the path to negotiation was closed, leaving only the path of escalation.

Iran’s National Security Adviser and chief nuclear negotiator Ali Larijani . . . assassinated by Israel, he represented the pragmatic wing of the Iranian establishment. Image: Wikipedia

Energy warfare masquerading as security
Kent’s second explosive claim involves energy infrastructure. He argues that strategic opportunities — particularly Qatar’s gas potential to stabilise global markets — have been deliberately targeted to increase tensions rather than reduce them .

The facts support him. On March 18, 2026, Israel launched a significant aerial assault on Iran’s South Pars gas field, which provides nearly 70 percent of Iran’s domestic gas. Prime Minister Benjamin Netanyahu admitted Israel “acted alone” in this attack.

The result? Iran retaliated by striking Qatar’s Ras Laffan Industrial City — the world’s premier LNG hub — damaging approximately 17 percent of Qatar’s export capacity .

Global gas prices surged toward US$117 per barrel. The UK benchmark peaked at almost 183p per therm. Markets destabilised. And for what?

Here is the inconvenient truth, a stable energy market benefiting from Qatari and Iranian gas would reduce conflict incentives. By attacking this infrastructure, Israel ensured that economic interdependence — often the foundation of lasting peace — remains impossible.

Even President Trump distanced himself from the attack, stating the US “knew nothing about this particular strike” and describing it as Israel “violently lashing out”. When an American president feels compelled to publicly disavow his closest regional ally’s actions, something is fundamentally broken.

The ‘clean break’ strategy: 30 years of sabotage
Kent’s accusations didn’t emerge from nowhere. They reflect a consistent pattern dating back to 1996, when a group of neoconservatives — including figures who would later serve in the Bush administration — produced a policy paper titled “A Clean Break: A New Strategy for Securing the Realm”.

This document, prepared for Netanyahu, explicitly rejected the “land for peace” formula and proposed reordering the Middle East through military confrontations and regime change. It identified Iraq, Syria, Lebanon, Libya and Iran as targets.

It called for “removing Saddam Hussein from power” and “weakening, containing, and even rolling back Syria”.

Three decades later, we’re living the consequences. The Iraq war cost thousands of American lives. Syria descended into a catastrophic civil war. And now Iran faces sustained attacks. All while Israel’s security — not America’s — remained the central objective.

Kent’s resignation letter directly connected these dots: “It is clear that we started this war due to pressure from Israel and its powerful American lobby . . . This is the same tactic the Israelis used to draw us into the disastrous Iraq war”.

The human cost
Perhaps the most damning aspect of Kent’s accusation is personal. His wife, Navy cryptologist Shannon Kent, was killed in Syria in a suicide bombing. Kent now describes that conflict as “a war manufactured by Israel”.

Think about that. A Gold Star husband — someone who paid the ultimate price for American foreign policy — is telling us that his wife died in a war that served Israeli, not American, interests. If that doesn’t demand scrutiny, what does?

Why this matters now
Critics dismiss Kent as antisemitic or claim he is leaking classified information. But ad hominem attacks don’t address the substance.

Did Israel target a negotiator actively seeking peace? Yes. Did Israel attack energy infrastructure knowing it would destabilise global markets? Yes. Does Israel have a documented 30-year strategy of military confrontation over diplomacy? Yes.

The situation in Gaza further illustrates the pattern. As one analysis noted, Netanyahu’s “ceasefire” effectively granted Israel breathing space to consolidate political control while evading accountability. Within days, Israel’s Parliament passed a bill paving the way for West Bank annexation. This isn’t peace — it’s a pause for rearmament.

The parasite metaphor
A parasite feeds on its host, weakening it while appearing inseparable from it. Israel’s relationship with American foreign policy fits this description uncomfortably well.

American blood and treasure fund Israeli objectives. American credibility suffers when allies act unilaterally. American interests in stable energy markets get sacrificed for Israeli security concerns.

Joe Kent’s accusations deserve more than reflexive dismissal. They deserve investigation. Because if a Gold Star husband and former counterterrorism chief is correct — if Israel is indeed sabotaging peace for its own ends — then Americans have a right to know why their soldiers are dying and their markets are destabilised for another nation’s strategic objectives.

The description of Israel as a parasite may be harsh. But sometimes harsh truths are the only ones that break through comfortable lies.

Israel has positioned itself as America’s indispensable ally. Kent’s resignation suggests it may actually be the parasite draining American power while sabotaging any chance of Middle Eastern peace.

Marcus Alexander is an independent writer in Doha and contributor to Channel Media Network.

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Article by AsiaPacificReport.nz

Northern Mariana Islands’ security and stability vital for US, say military leaders

By Asia Pacific Report -

March 21, 2026

By Mark Rabago, RNZ Pacific Commonwealth of the Northern Marianas correspondent

The Commonwealth of Northern Mariana Islands’ (CNMI) economic struggles are not just a local issue, but a matter of strategic importance to American operations in the Indo-Pacific, say senior US military leaders.

In a letter, dated 25 February 2026, Admiral Samuel Paparo, commander of United States Indo-Pacific Command, said he shared concerns raised by CNMI leaders about worsening economic conditions and their broader implications.

“The security and stability of the CNMI are of vital strategic importance,” Paparo wrote, warning that the islands’ civilian infrastructure and community wellbeing were “inextricably linked” to the US military’s ability to operate in the region.

He said he had directed staff to analyse proposals put forward by CNMI officials, but noted the requested federal actions fall outside his authority.

Paparo said he would elevate the issues to agencies including State, Commerce, Transportation and Homeland Security.

Paparo also backed calls for direct engagement with the White House, saying he supported “an executive-level dialogue with the Administration” and was prepared to take part.

“We are committed to the security and prosperity of the CNMI,” he said.

Expanding US presence
At the same time, military officials say an expanding US presence across the Marianas could provide longer-term economic opportunities — though not an immediate fix.

Speaking at a Saipan Chamber of Commerce forum on March 11, Rear-Admiral Brett Meitus of Joint Region Marianas said more than US$500 million in projects were underway, with additional development planned, particularly on Tinian.

“It’s going to happen over the course of several years . . . we just don’t have the capacity to do it all at once,” he said.

Meitus said the military was trying to move beyond a short-term construction surge toward a longer cycle of “build, sustain, and operate,” aimed at creating ongoing economic activity.

“Just as important is how we sustain it . . . making sure that what we build looks like it should a year, two years, five years, ten years from now,” he said.

He said future operations-including exercises and deployments-are expected to bring spending into the local economy as visiting personnel stay in hotels and patronise businesses.

“When forces come in . . . they can spend money on the local economy,” he said.

Potential benefits
Meitus also pointed to potential benefits including expanded land leases, increased exercises, more port visits and service member tourism, while acknowledging that coordination across different military branches is still evolving.

“We’re working hard to get our arms around exactly how we want to do it,” he said.

He added that the goal is to move from a project-driven boost to more sustained participation by local businesses, though he acknowledged it would not fully address the CNMI’s economic challenges.

Both leaders emphasised the need for continued engagement with federal partners, framing the CNMI’s economic outlook as closely tied to US strategic interests in the Indo-Pacific.

This article is republished under a community partnership agreement with RNZ.

Article by AsiaPacificReport.nz

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