QUESTION: Mr. Armstrong, we greatly appreciate your courage, and it’s apparent that you have contacts that nobody else has. You said China takes 80% of Iran’s oil. I assume they get that through the Straits of Hormuz. If Iran were to shut down the Strait of Hormuz, wouldn’t that significantly impact their sales to China? You have explained the Middle East better than anyone I have ever read or watched on TV. Iran warned of “everlasting consequences” after the U.S. bombed three major nuclear sites. I can see what you’re laying out: that this is the beginning rather than the end. Do you think China or Russia will enter this conflict soon?
Bret
ANSWER: The reason Iran can attack the Straits of Hormuz is that the media has unreported the completion of the China-Iran railway link, which is a significant milestone within China’s Belt and Road Initiative (BRI), specifically reviving the ancient Silk Road through modern infrastructure. By the way, the ancient city of Antioch became so wealthy because it served as a key link to the Silk Road, where all goods entered the Greek and Roman world. The term assumed the “PURPLE” was associated with a Roman emperor because it was a dye from Asia that arrived via Antioch. It was decreed that only the emperor could wear it.
Antioch was the port city in Syria. It was strategic throughout history. I have explained, perhaps not in great detail, but China has been reestablishing the ancient Silk Road. Iran can shut down the Straits of Hormuz, and it will NOT impact the export of oil to China. The China-Iran railway link, part of the broader China-Central Asia-West Asia Economic Corridor, primarily relies on the Kazakhstan-Turkmenistan-Iran (KTI) Railway as its critical connector. The agreement was signed between China, Kazakhstan, Turkmenistan, and Iran, finalizing the KTI Railway agreement in 2013. The construction began in December 2014. The first direct freight train from China to Iran arrived in Tehran on February 15, 2016.
Now, look at this from a geopolitical perspective. You have the Houthis attacking ships in the Red Sea. With this rail line, Iran can shut down the Strait of Hormuz, and the Houthis keep the pressure on, stopping the traffic through the Suez Canal. They have the ability to impact the energy flow out of the Middle East significantly.
The Shia Muslims do not control “most” of the oil in the Middle East, though they live in regions with significant reserves. Control is primarily held by national governments and state-owned companies, not by sects directly. Nonetheless,
Saudi Arabia 267 billion barrels (17% od global proven reserves)Iran 208 billion barrels (4th largest globally)Iraq 145 billion barrels (5th largest globally)Kuwait 102 billion barrels reserves. Sunni-led monarchyUnited Arab Emirates (UAE) 98 billion barrels reserves. Sunni-led federation.Qatar Major gas producer, also has oil. Sunni-led monarchy.
Saudi Arabia, Kuwait, UAE, and Qatar (all Sunni-led monarchies) hold a significantly larger portion of the region’s proven oil reserves combined than Iran and Iraq. However, the Shia-Majority Regions are Important. Iran and southern Iraq (Shia heartland) have massive reserves and are crucial producers. Iran is a founding member of OPEC. While control is national, not sectarian, this can be volatile in times of war, as we saw during the 1970s.
What I believe is significant here is the railway between China and Iran. The primary rail corridor connecting China to Iran became fully operational in recent years. Trains now run regularly from various Chinese cities (like Yiwu, Xi’an) through Kazakhstan and Turkmenistan, terminating in Tehran. The final section crossing Turkmenistan into Iran was finalized, making the entire route viable. This now facilitates significantly larger volumes of trade between Iran and China. China exports electronics, machinery, textiles, and industrial goods. Iran exports petrochemicals, minerals, agricultural products (like saffron, pistachios), and potentially more oil/gas in the future (though sanctions complicate this).
This provides China with a crucial overland route to access Middle Eastern markets and resources, reducing dependence on vulnerable sea lanes like the Strait of Malacca. It also offers Iran a vital alternative trade corridor, mitigating the impact of Western sanctions and reducing its isolation. Access to the vast Chinese market and Eurasian rail network is crucial.
Keep in mind that this has now introduced a geopolitical alignment between Iran and China. Both China and Iran are acting as a counterbalance to US influence in the region. It integrates Iran more firmly into China’s Eurasian connectivity vision. This railway is now a critical national security issue for China.
The US sanctions on Iran remain a significant hurdle. International banks and companies are wary of facilitating transactions, limiting the route’s full potential. China uses workarounds, but sanctions create friction and risk. They have only further divided the world economy, giving the incentive for the establishment of BRICS, which has undermined the global economy as a whole, dividing the world in half, all for the geopolitical instigation of the Neocons.
China has indeed completed and operationalized major rail links to Iran via Central Asia. This represents a transformative achievement for the Belt and Road Initiative, offering a faster, land-based trade artery between East Asia and the Middle East. While challenges such as sanctions and logistical hurdles persist, the link significantly boosts trade, provides Iran with an economic lifeline, strengthens Sino-Iranian ties, and enhances Eurasian connectivity. It is a concrete realization of the modern Silk Road vision. The Neocons have dominated American foreign policy, and they have NEVER given economic policy a second thought.
I was the first advertiser to help Bill Kristol launch The Weekly Standard. We took the back cover every week, until I realized he was NOT an economic conservative, he was a Neocon. They were focused purely on the geopolitical aspects of redesigning the Middle East and defeating Russia and China. I do not speak from speculation. I had a front-row seat to the plans and objectives that never took into account the global economy. This is what created BRICS – their arrogance. I have even attended White House dinners.
