The Strait of Hormuz will soon have no value as an oil conduit, US Treasury Secretary Scott Bessent said on Tuesday, as countries develop new export pipelines.
Speaking at the G20 finance ministers meeting in North Carolina, the Treasury chief also said the US will likely announce actions on banks with links to the Iranian regime in the next two weeks, as the Trump administration seeks to "asphyxiate" the regime's economy.
Mr Bessent said the Iranians are trying to use the Strait of Hormuz as a choke point during the conflict with the US.
"It's not a choke point for the US but it is a choke point for many, many other countries," he said, noting that the strait would soon be "bypassed".
"In two years, the Strait of Hormuz will be a worthless piece of water. The oil will be going on pipelines across the land," he said.
Last month, Mr Bessent told a news station in Arizona that the strait is "never going back to the way it was" and estimated that up to about 70 per cent of the energy that usually goes through the waterway would end up in pipelines.
Shipping through the strait collapsed after the US and Israel launched the war against Iran on February 28. Shipping volumes have ticked up in recent weeks but remain far below pre-conflict levels.
Mr Bessent has been holding discussions with his counterparts in Asheville this week to wrangle global support to isolate Iran's economy.
Washington recently announced that it is expanding the scope of secondary sanctions it can place on countries and businesses that engage with the regime and threatened to cut off access to the dollar system for those who do so.
"We are speaking with our allies here. We all come forward, and will get a great show of support whether it's from the EU, the ECB, the UK, the UAE," he said.
"The economic outcomes could not have happened without the initial kinetic success."
