The United States conducted its tenth consecutive night of airstrikes against Iranian Revolutionary Guard targets near the Strait of Hormuz early Tuesday, even as Iran’s IRGC Navy attacked another oil tanker, forcing its crew to abandon ship. The Strait of Hormuz — the choke point through which roughly 20 percent of global oil supply flows — remains partially contested. An interim diplomatic deal collapsed last week. No replacement framework is in sight.

This is not one crisis. It is at least four, overlapping in ways that limit U.S. options and amplify adversary leverage. The Hormuz confrontation is the most acute, but it is playing out simultaneously with a sudden fracture in US-China relations, a stalled Ukraine ceasefire, and a deepening China-Russia military partnership in the Indo-Pacific. Understanding them together matters more than examining any one in isolation.

What We Know

Iran/Strait of Hormuz. The current military confrontation began around July 12, when the IRGC Navy declared the Strait closed after firing warning shots at a vessel attempting transit. U.S. Central Command responded with strikes on Iranian military sites near the Strait. Since then, CENTCOM has launched at least ten rounds of strikes — a rate of roughly one per night. As of the morning of July 21, the IRGC claimed responsibility for attacks on three ships in the southern Strait route, including at least one tanker whose crew evacuated. Iran has publicly stated it is in a “full-scale war.” A prior interim agreement to reopen the waterway collapsed before implementation, according to AP.

The ISW reported on July 18 that Iran used an advanced reconnaissance satellite, acquired from China in 2024, to target U.S. military assets and bases across the Middle East in spring 2026 — a detail first disclosed by the Financial Times. That satellite acquisition now appears directly relevant to ongoing Iranian targeting capabilities.

US-China relations. On July 17, President Trump delivered a primetime address accusing China of stealing data on 220 million American voters during the 2020 election cycle. China’s Foreign Ministry called the allegations “groundless accusations.” Foreign Policy reported that a May 2026 summit between Trump and President Xi Jinping had appeared to stabilize relations and address Taiwan — but Trump’s election-interference speech effectively reversed that momentum. Bloomberg characterized the accusations as threatening the trade truce reached earlier this year. The relationship is now, as Foreign Policy put it on July 17, “more volatile than ever,” oscillating between managed rivalry and open confrontation depending on the news cycle.

Russia-Ukraine / sanctions pressure. A bipartisan U.S. Senate bill introduced around July 14 would impose 100 percent tariffs on imports from China, India, and several other countries that continue purchasing Russian oil. Bloomberg and The Hindu both reported on the legislation. FBI Director Kash Patel was also reported by Politico on July 20 to be planning a trip to Russia — an unusual move, described as occurring “as the U.S. and Russia have failed to come to terms on ending the war in Ukraine.” No ceasefire framework appears active. Reconstruction conferences have shifted toward private investment rather than donor commitments, according to the New York Times, suggesting a long-war expectation is hardening among Western planners.

Indo-Pacific naval activity. China and Russia completed their “Joint Sea-2026” naval exercise on July 6, centered near Qingdao, Shandong Province, involving surface, subsurface, aerial, and support units. Defence Security Asia described it as a demonstration of a deepening military alliance. ISW’s China-Taiwan Update from July 17 documented a suspected act of transnational repression in Taiwan — a Hong Kong national arrested after allegedly assaulting the CEO of the Indo-Pacific Strategy Think Tank in Taichung. Taiwan’s Mainland Affairs Council called it a deliberate attempt to intimidate critics of PRC military activity.

What’s Driving It

The Hormuz crisis is partly a function of Iran’s assessment that the window for leverage is open. U.S. force posture has been stretched across multiple theaters. Iran’s acquisition of Chinese satellite intelligence, if confirmed, represents a material upgrade to its targeting architecture — one that makes U.S. base protection harder and deterrence costlier. Iran’s declaration of “full-scale war” is also domestic politics: the leadership calculates that symbolic resistance sustains internal legitimacy even as strikes destroy military infrastructure.

China’s simultaneous appearance in this picture — as both a diplomatic partner with the U.S. and a military intelligence supplier to Iran — is the central contradiction American policymakers have not resolved. Beijing has strong incentives to keep the Strait unstable enough to occupy Washington while managing the relationship closely enough to prevent formal decoupling. Trump’s election-interference allegations destabilize that balance, but Beijing likely views them as domestic theater rather than a genuine policy shift, given the administration’s history of rhetorical escalation followed by deal-seeking.

The Senate tariff bill targeting Russian oil buyers reflects a bipartisan frustration that existing sanctions have been diluted by continued Chinese and Indian purchases. However, secondary sanctions at 100 percent tariffs on Chinese imports would constitute a significant trade escalation at exactly the moment the administration claims it has reached a trade truce with Beijing. The tension between those two positions has not been resolved publicly.

Russia’s strategic calculus in Ukraine has shifted toward attrition. The collapse of ceasefire talks and the movement of reconstruction discussions toward private financing suggests neither Kyiv nor Moscow sees a negotiated end as near-term. Patel’s reported Russia visit, if it occurs, would be an unusual FBI-led diplomatic channel — one that could signal a back-channel track parallel to formal State Department efforts, or simply reflect personal entrepreneurialism within an administration that runs foreign policy in fragmented lanes.

Implications

For U.S. national security. Ten consecutive nights of strikes without Strait reopening indicates the air campaign alone is insufficient. Ground options carry prohibitive costs. The IRGC’s use of Chinese-supplied satellite intelligence to target U.S. bases is a new variable — one that shifts the intelligence overmatch advantage the U.S. has historically enjoyed. Policymakers will face pressure to address the satellite capability directly, either through diplomatic pressure on Beijing or through kinetic or cyber means, each of which carries escalation risk.

For energy markets and allied economies. The Strait of Hormuz handles roughly 17-20 million barrels per day of crude oil. Sustained disruption — even partial — pushes global energy prices higher and compounds inflationary pressure in Europe, Japan, South Korea, and India. The EIA has already adjusted its oil price forecast in response to earlier phases of the crisis. A prolonged conflict without Strait reopening would impose structural costs on allied economies more dependent on Gulf energy than the U.S. itself.

For businesses. Shipping insurance premiums in the Persian Gulf and Indian Ocean have risen sharply. Tanker operators are rerouting around the southern Strait route where possible. Companies with supply chains dependent on Gulf hydrocarbons — including petrochemical manufacturers, airlines, and logistics firms — face both price volatility and route disruption. The Senate’s proposed secondary tariffs on Russian oil buyers add a parallel layer of potential disruption to energy trade patterns with India and China.

For the alliance structure. Gulf Arab states are in a difficult position: exposed to Iranian retaliation, dependent on U.S. protection, but also economically tied to Chinese trade. Morocco’s normalization agreement with Israel in the context of Gaza reconstruction — signed July 15 in Rabat — signals continued momentum for the Abraham Accords framework, but the Hormuz crisis complicates the security architecture those accords assumed.

What to Watch

Strait status. The critical near-term indicator is whether the Strait reopens partially for commercial traffic. Each additional day of closure increases the probability of a tanker war reminiscent of the 1980s, with broader coalition responses.

China’s position. Watch for whether Beijing issues any statement distancing itself from Iranian satellite use or calling for Strait reopening. Silence is meaningful. A formal position calling for de-escalation would signal that Beijing has calculated the economic damage to its own energy supply outweighs the strategic benefit of U.S. distraction.

Senate tariff bill. Whether the Russian oil tariff bill advances past committee will determine whether the Russia-China-India energy triangle faces real financial disruption. If it passes, expect sharp diplomatic responses from New Delhi and Beijing simultaneously.

Patel’s Russia trip. If FBI Director Patel travels to Moscow, watch for whether it produces any public framework or leaks about a separate diplomatic channel on Ukraine. An unofficial back-channel at the intelligence leadership level, bypassing the State Department, would represent a significant organizational precedent.

China-Taiwan. The transnational repression incident in Taichung is a relatively low-level data point, but it fits a pattern ISW has been tracking. Sustained grey-zone harassment of Taiwan-based critics of PRC military policy tends to escalate gradually. The next indicator would be a similar incident involving a more prominent figure or a diplomatic response from Taipei that draws broader international attention.

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