Iran's oil minister isn't happy about American efforts to deprive Iran of oil income:
Zanganeh, in comments reported by SHANA, the oil ministry's news agency, did not specify who he saw as the enemy but Iran is locked in confrontation with the United States, which has applied sanctions and has said that its goal is to reduce Iran’s oil exports to zero.
"The oil, gas and petrochemical sectors are the frontline in the battle against the enemy," Zanganeh said.
As I've said, while economic sanctions are considered an alternative to war, if sanctions are really effective the target of the sanctions will see them as little different than kinetic attacks and may consider kinetics in response.
During the Iran-Iraq War in the 1980s, as Iraq waged a military campaign against Iranian oil exports, the Saudis (aided by America's Alaska oil coming online, I believe) waged a price war:
More damaging to Iran's economy was the rapid decline of oil prices. While Iraq could borrow money to make up for lower oil prices, Iran relied on oil revenue for weapons and munitions. Iran's President Khamenei recognized this insurmountable fact of life stating "the price war is no less important to us than the military war." Indeed, in a July 1986 address to 8,000 Iranian commanders, Iran's rulers broke disturbing news that Iran's crumbling economy required a military victory by March 1987.
The Iranians waged war on Gulf shipping in an effort to make the Arab states pay a price for trying to block Iran's oil exports, and loudly practiced military maneuvers in the Strait of Hormuz to demonstrate the ability to close the strait.
It wasn't too long before frustrations on other fronts of the war seems to have led Iran to expand the war at sea to include America:
The frustration of failing to crush Iraq, of witnessing America lead the West into the Gulf in force, of enduring air attacks against her oil lifeline, and of seeing the militarily weak but wealth Arab Gulf states funnel money to prop up Iraq's military pushed Iran to the brink of irrationality. When Iraq was the country that had invaded Iran in the first place back in 1980 this seemed too unjust and proof that the world was against their revolution. On top of this, Iran received no sympathy when, in July, Saudi security forces bloodily suppressed Iranian "pilgrims" after they tried to mobilize a pro-Iranian demonstration in the heart of Saudi Arabia. On October 3, 1987, Iran crossed the line into irrationality. Unable to defeat her one enemy Iraq, Iran massed between 30 and 50 speedboats for an attack on Saudi Arabia's off-shore oil terminal at Khafji--the one used by the Kuwaitis and Saudis to sell oil in Iraq's name. Saudi Arabia responded by deploying warships and fighter aircraft. Iran pulled back but five days later in another confrontation the Saudis sank three speedboats.
Iran, apparently not satisfied with defeat at the hands of Iraq and then Saudi Arabia, even struck an American flagged tanker, Sea Isle City, with a Silkworm missile while it lay in Kuwaiti waters. The United States retaliated with Operation Nimble Archer on October 19, 1987, during which three Iranian oil platform bases were attacked. Many Iranians knew that a course of confrontation with America was foolish but the short term satisfaction of striking out at those who helped Iraq--even the United States--was beginning to win out over reason.
Iran has said if they can't benefit from Hormuz oil shipping routes that nobody should be able to. If our oil sanctions really do start to bite deep without Iran able to significantly evade the sanctions, Iran will consider military/terrorist options in response.
Does Iran know that they can't beat America any more or less than they knew in 1988?
I'd keep our capital ships out of the Persian Gulf for now and carefully investigate the death of our 5th Fleet commander in Bahrain.
UPDATE: Iran's chief nutball Rouhani repeats the longstanding Iranian threat:
"If one day they want to prevent the export of Iran's oil, then no oil will be exported from the Persian Gulf," he said.
Be careful out there.
