Iran’s overland trade workaround falters at borders amid Hormuz blockade

Iran's pledge to counter the U.S. naval blockade of the Strait of Hormuz by expanding overland commerce is running into trouble at nearly every border crossing, according to the Wall Street Journal News Corp ↘ 0.21%. Iranian truck drivers are stranded at borders with Pakistan, Turkmenistan, and Afghanistan, facing mounting bureaucratic obstacles and costs — many imposed by their own government — that are choking off Tehran's limited remaining trade routes.wsj

A Self-Inflicted Bottleneck

The situation is especially dire at the Pishin border crossing in Sistan-Baluchestan province, where Iranian truckers reported having no access to water, food, or sanitation as refrigerated cargo spoiled in the heat. Drivers said Pakistan would not allow them to unload while Iran refused to take responsibility for their predicament. Some accounts described fees of roughly $10,000 being demanded to move a single heavy vehicle across the border, though no official Pakistani documentation has confirmed the charge. Similar gridlock has been reported at crossings with Turkmenistan and Afghanistan, amounting to what the Journal described as a self-inflicted setback that constricts trade through Iran's few remaining economic outlets.x+1

Hormuz Traffic at a Trickle

The overland failures come as maritime commerce through the Strait of Hormuz remains a fraction of prewar levels. Preliminary shipping data showed just four vessels transited the strait on September 15, down from seven a day earlier and well below the 10-day average of 18. Before the conflict began in February, roughly 125 large commercial vessels passed through the waterway daily. U.S. Central Command said on September 16 that the strait "remains open for transit," adding that "traffic is flowing and momentum is building despite Iranian attempts to intimidate and harm innocent civilian crews". CENTCOM told Al Jazeera that U.S. forces had facilitated the movement of more than 900 million barrels of crude oil through the strait since early May.rferl+1

Tightening the Economic Vise

Washington is simultaneously intensifying financial pressure on Tehran. The Treasury Department on September 14 imposed new sanctions on Russia's VTB Bank under its "Operation Economic Outcast" campaign, accusing the lender of establishing correspondent relationships with sanctioned Iranian banks and helping move billions in frozen Iranian assets. Treasury Secretary Scott Bessent warned that foreign institutions continuing to do business with VTB could face secondary sanctions. The bank was already under U.S. sanctions over Russia's war in Ukraine; the new designation under Iran sanctions authorities raises the stakes for any remaining counterparties.treasury+2

The combined effect of a naval blockade, collapsing Hormuz traffic, faltering overland alternatives, and an expanding sanctions campaign is steadily narrowing Iran's economic options. "Another incremental sanctions measure may shorten Tehran's runway at the margins," sanctions expert Brett Erickson of Obsidian Risk Advisors told RFE/RL, "but that is a terrible trade when the broader global crisis is consuming the world's economic timeline by the mile".rferl