Could Hormuz become America’s Suez?

In 1956, Britain was forced to abandon the Suez Canal and withdraw from Egypt after a humiliating political and financial defeat. The crisis did not end the British Empire overnight, but it exposed the decline of a power that had dominated much of the world for more than two centuries, in an empire on which the sun famously never set. Britain could still fight wars, but it could no longer act as an independent global power without facing the economic and political limits of its strength. Now, nearly seventy years later, the question is whether the war with Iran and the crisis around the Strait of Hormuz could become America’s Suez.

When war becomes too expensive

After Egyptian President Gamal Abdel Nasser nationalised the Suez Canal in July 1956, Britain, France and Israel launched a military campaign to regain control of the canal and weaken Nasser’s government. Their forces made rapid progress, but the operation soon became a financial and political crisis for London.

The British pound came under heavy pressure, and the Bank of England had to use its dollar reserves to defend the currency. The United States opposed the invasion and refused to provide the financial support Britain needed unless it agreed to stop the operation. On 6^th November, Britain accepted a ceasefire. It later withdrew its forces from Egypt.

As the International Monetary Fund’s account of the crisis explains, the pressure on sterling was central to Britain’s decision. The crisis showed that the government could not continue the war without putting its financial position at long-term risk.

The war with Iran could create a similar problem for the United States, although the economic conditions are different. The dollar is far stronger internationally than the pound was in 1956, and the American economy has greater resources. But the comparison is about the cost of sustaining a war when its political goals remain out of reach.

If the war continues without a clear result, the United States will have to spend more on military operations, weapons, logistics and the protection of its forces. At the same time, the disruption of energy supplies through the Strait of Hormuz can raise costs across the global economy. These pressures may gradually make the war harder to justify, especially if Iran can draw the United States into a prolonged conflict with no clear progress toward its goals.

The cost reaches American households

The Strait of Hormuz is central to this problem because of its role in the global energy market. Before the war, around one-fifth of the world’s oil consumption passed through the strait, along with a major share of global liquefied natural gas shipments. As oil prices rose, gasoline and diesel became more expensive, air travel and shipping costs increased, and the cost of transporting goods went up. This is where the war became a serious domestic problem for the White House. Higher gasoline prices were immediately visible to American households. Families had to spend more to drive for daily activities and higher diesel prices increased the cost of moving goods.

The latest energy-market reports show how difficult this problem can even become. In October 2026, Reuters reported that Brent crude remained above $100 a barrel. Diesel prices in the United States had also risen sharply, adding to domestic political pressure ahead of the midterm elections. The Reuters report on rising oil prices and the prolonged conflict describes the growing challenge for the Trump administration.

High energy prices can also make it harder to control inflation. Transport and production become more expensive, and the effects spread through the economy. If the Federal Reserve keeps interest rates high to control inflation, borrowing becomes more expensive for households and businesses. The government also has to meet the direct cost of the war while paying interest on its existing debt.

Nevertheless, none of these pressures would force Washington to end the war. The key issue is their combined effect over time. If the war continues, energy prices remain high and the United States fails to achieve objectives, the economic cost of continuing may eventually become greater than the expected benefit.

From military leverage to economic limits

A war of attrition changes the way governments calculate success. At the beginning of a conflict, leaders may expect military action to produce a quick political result. If that result does not come, they face a difficult choice: increase the pressure and spend more, or accept that the original goals may be impossible to achieve at an acceptable cost.

This is the danger facing the United States. Washington has the ability to strike Iranian targets and maintain a strong military presence in the region. But the ability to damage does not mean that Iran will accept American demands. If each new round of fighting adds to the cost without producing a decisive political result, the United States will find itself spending more while moving no closer to its goals.

The Strait of Hormuz gives Iran a way to increase this pressure. Disruption to shipping can keep energy markets unstable and raise the economic cost of the conflict well beyond the battlefield. The longer the disruption continues, the more difficult it becomes for Washington to separate its military campaign from its effects on the American economy.

The question is whether the United States can continue to bear the full cost of the conflict if the economic pressure grows while the chance of achieving its objectives declines. At some stage, American administration may conclude that continuing the war will bring more damage than benefit. That would create the conditions for an American retreat. If Washington withdraws without achieving its main goals, the result could be a strategic defeat, even if American forces remain far stronger than Iran’s in conventional military terms.

Why China could benefit

Such an outcome would also affect the wider balance of power. China is already benefiting from a war that consumes American resources, damages Washington’s reputation and reduces its ability to focus on other strategic priorities. Beijing does not need to defeat the United States directly. It can benefit simply by watching Americas useless overstretch. The war also gives China an opportunity to question whether the United States can keep its commitments to allies in Asia. China would also suffer from high energy prices and disruptions to trade. But if the United States emerges from the war with fewer resources, greater economic pressure and damaged credibility, China could gain room to expand its influence without taking on the costs of a direct military confrontation.

This is one reason the outcome of the war matters beyond the Middle East. A costly American withdrawal could affect how allies and rivals judge US power. Countries that depend on Washington for security may question its ability to sustain a long conflict. Rivals may become more willing to challenge American influence in other regions.

Could this be America’s Suez?

The Suez Crisis did not single-handedly end British power. Britain’s relative decline had been developing for decades, and the United States had already become the leading Western power. But Suez made the change unmistakable. Britain had launched a heavy military operation and then had to withdraw under financial and political pressure. But the crisis clearly exposed the limits of its ability to act as a global power.

A similar outcome is possible for the United States in Iran. If the war becomes more costly with time, if energy prices continue to place pressure on American households and businesses, and if Washington cannot achieve its main objectives, the economic logic for continuing the conflict may become increasingly weak. A withdrawal without a clear political achievement would then damage the credibility of American power as a world superpower.

The United States is not Britain in 1956. Its international position will not collapse because of one war. Yet these advantages do not remove the basic problem: US may ruin its credit as super power of current international order.

The real test will come when Washington has to choose between continuing an expensive war and accepting a retreat. If it leaves Iran without achieving its goals, the consequences could extend far beyond the battlefield. The war could become a turning point that speeds up the decline of American order and gives other powers more room to shape the coming international order. Such scenario would be what could make Hormuz America’s Suez.

The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.