WASHINGTON, July 12 — A new analysis of potential escalation scenarios following Iran’s announced closure of the Strait of Hormuz draws direct comparisons to the last time the United States confronted such a challenge in the Persian Gulf. The record shows that during Operation Earnest Will, from 1987 to 1988, the U.S. Navy escorted reflagged Kuwaiti tankers through the waterway. That operation involved 40 U.S. ships.
It also produced two of the most consequential incidents of the late Cold War era in the Gulf. On April 14, 1988, the USS Samuel B.
Roberts struck a mine. Less than three months later, on July 3, 1988, the USS Vincennes shot down Iran Air Flight 655, killing 290 civilians. Those events remain a stark reference point for any new escort mission the U.S. Fifth Fleet might undertake.
According to the analysis, several pathways are now under consideration. The most immediate military option would see the Fifth Fleet begin escorting commercial vessels, mirroring the Earnest Will model.
A diplomatic track could involve seeking a United Nations Security Council resolution that both condemns the closure and authorizes force. The Joint Comprehensive Plan of Action, or JCPOA, remains a potential diplomatic framework, though the United States withdrew from that agreement in 2018. Iran’s oil exports averaged 1.5 million barrels per day in 2024.
Under a full blockade or closure scenario, those exports could be cut to zero. Regional dynamics add another layer. Saudi Arabia and the United Arab Emirates may increase their own oil production to help stabilize global markets.
The Strait of Hormuz closure could also trigger a sharp spike in insurance rates for tankers transiting the region. The timeline of potential escalation remains unclear.
What is certain is that the United States has navigated this exact crisis before, and the precedents are not encouraging. The current administration faces a set of choices that carry both military and economic consequences, with the ghost of Iran Air Flight 655 looming over any decision to place Navy warships between Iranian forces and commercial traffic. What to watch next: whether the administration pursues a UN Security Council resolution first, or moves directly to an escort operation.
The insurance markets will provide an early signal. If rates for Gulf transit spike sharply, the private sector will have already priced in a return to the dangers of 1987-1988.
