U.S. aims to box out China from the Panama Canal to the Malacca Strait
At play are all critical waterways and congestion bottlenecks through which the world’s energy products, agriculture, and supply chain parts flow.
Despite China’s rapid growth, it still relies heavily on energy imports, and the US continues to claim naval superiority for now.
But while their Hormuz blockade has dominated the headlines, behind the scenes the US is quickly making moves to greater influence the world’s other shipping and strategic military arteries from the Panama Canal and Greenland to the Strait of Gibraltar between Europe and Africa, and to Asia’s Strait of Malacca—the busiest strait in the world.
“The U.S. is applying pressure, and it’s clearly addressing the weak spots that are reflected in these various nodes—or straits—of global supply chain transit,” said Thierry Wizman, a top economic strategist for the Macquarie Group. “They’re the sea lanes that China depends on to uphold its economic preeminence.”
The escalation started soon into Trump’s second term, when he launched his global tariff war, with China as a primary target. China countered by asserting its global supply chain dominance over critical minerals and rare earths. And the U.S. is now responding by targeting strategic choke points and China’s oil-producing allies, Iran and Venezuela.
“The U.S., in recent weeks and months, is trying to assert some dominion over those places, effectively as a way of boxing in China,” Wizman told
Fortune. “It doesn’t have to lead to a kinetic war; it could just be a blocking maneuver. If the U.S. could threaten to cut off China’s energy supply, well then China would think twice about invading Taiwan or making other moves.”
Even if weakening China is only a secondary goal in the Middle East, it’s easy to see a bigger chess game at play, said energy analyst Dan Pickering, founder of Pickering Energy Partners consulting and research firm. And it’s no coincidence that nearly all of Venezuela’s and Iran’s oil exports went to China.
“Behind everything that’s going on, there’s a China angle as well,” Pickering said of the Iran war. “The impact on the energy side isn’t great for China, and that’s a fairly important secondary impact. That certainly gets woven into the broader strategy.”
This is not to say the White House is playing “4D chess” as Trump’s most sycophantic supporters claim. In fact, Wizman said, Trump’s blunders include weakening the country’s NATO alliances and seemingly lacking a clear endgame in the Middle East after Iran’s countermoves.
“I think this has to do with poor execution more than anything else. It’s not a flaw in the theory of geopolitical competition with China; I think it’s the flaw in the execution,” Wizman said. “It has a lot to do with the president’s personality and his impulses.
“We don’t have an articulate administration in Washington,” he continued. “We don’t have an administration that can really speak to the underlying issues with clarity and credibility, unfortunately.”
On the other side of the board—or world—is China watching everything unfold and enjoying watching the U.S. potentially flounder in the Middle East while harming many of its historic friendships?
