Trade routes, the war in Iran and the 'new mercantilism'

Dear investors,

It is tempting to read the ongoing war with Iran as yet another episode of the Israel / Iran conflict, or to see it as a war of liberation for the Iranian people. In our view, what is unfolding is a direct continuation of the U.S. strategy of recent years: reducing Tehran's nuisance capacity — not to "change the regime" or rebuild a state, but to control the energy and maritime routes on which China depends.

Behind the targeted strikes and intelligence operations conducted with Israeli allies, the same logic is at work as in Panama, the Eastern Mediterranean or the Arctic: regaining control of the strategic chokepoints — straits, canals, oil corridors — that condition the flow of oil and global trade. In other words, this war is not a local parenthesis but one more episode of the "new mercantilism" we described in our recent letters: an increasingly tangible Sino-American confrontation.

1. From the "liberal order" to control of the routes

In our recent strategic-allocation letters we have discussed the gradual end of the post-war multilateral framework and the unabashed return to spheres of influence. Recent developments all point in the same direction: the United States no longer seeks to preserve an "open liberal order" but to lock down the chokepoints that condition the rise of its only rival for global supremacy, China.

This strategy is best read by following the major strategic chokepoints one by one:

Panama

The Panama Canal accounts for about 5–6 % of world maritime trade and nearly 40 % of U.S. container traffic. For several years China had gained a foothold via port concessions and Belt-and-Road-related projects. The return of the Trump administration marked a turning point:

• Washington pushed Panama to formally withdraw from the Belt and Road Initiative and to review several contracts with Chinese groups.
• Panama's Supreme Court recently ruled unconstitutional a key contract awarded to a CK Hutchison subsidiary for the management of ports at both ends of the canal, triggering strong Chinese reactions.
• In parallel, a BlackRock-led consortium negotiated the takeover of part of CK Hutchison's port assets, presented in Washington as a strategic victory.

The "southern routes"

In Latin America, Argentina has just signed a framework agreement with the United States on critical minerals (lithium, copper, etc.), complemented by a trade agreement committing Buenos Aires to prioritise the U.S. for its critical-mineral exports over "market-manipulating economies".

In Africa and the South Atlantic, the United States and its allies are pushing alternative corridors to Chinese projects: port infrastructure, rail links, raw-material partnerships, under initiatives such as the G7 Partnership for Infrastructure. The objective is the same: secure "friendly" supply routes and limit China's ability to control southern routes alone.

Suez and the Eastern Mediterranean: the heart of China–Europe trade

The Suez Canal carries about 12 % of world trade and an essential share of China–Europe flows. China has invested more than $3 billion in the Special Economic Zone and port terminals, notably at Ain Sokhna and Alexandria.

In parallel, several projects and studies evoke the medium-term possibility of opening, via Israel, a land corridor or even a canal connecting the Mediterranean to the Red Sea, offering an alternative partially controlled by U.S. allies. The U.S. attitude during the Gaza crisis should be read in this light of regaining control of the area.

Greenland and the Arctic: the next frontier of maritime routes

Since 2019, Washington has publicly expressed interest in Greenland, officially in the name of national security. In January 2026, Donald Trump confirmed at Davos that a framework agreement including mineral rights was being negotiated, with the explicit goal of preventing China from getting hold of the island's significant rare-earth reserves. The intent is clear: secure early on a key territory for:

• critical resources (rare earths, metals),
• and the future Arctic routes, which could give China a partial workaround of the traditional canals.

South China Sea: locking down the first island chain

Finally, the U.S. Navy's "freedom of navigation" operations in the South China Sea aim to contest Chinese hold on the surrounding archipelagos and to preserve, for Washington, the option of controlling flows in case of crisis. In May 2024, the destroyer USS Halsey carried out such an operation near the Paracels, reminding that the United States "will continue to fly, sail and operate wherever international law allows".

This language, repeated at regular intervals, is not innocuous: it signals to Asian allies that the security of these routes remains under U.S. umbrella, and to Beijing that the exit from the "first island chain" will remain contested.

2. The war in Iran in this framework

In this context, the current war with Iran appears as a Middle-Eastern facet of the same strategy.

• Iran is an energy pivot: an oil and gas exporter, a key player in the Persian Gulf — through which a major share of Asian hydrocarbon supply transits.
• Its capacity to block the Strait of Hormuz (ballistic missiles, drones, fast-attack craft) has long been identified as a major risk for the oil flows of U.S. Middle-Eastern allies.
• By targeting Iranian military infrastructure and strike capabilities, the United States seeks to reduce Tehran's ability to disrupt these flows durably — without engaging, for now, in costly political reconstruction or regime change, while also raising China's energy costs.
• Russia's public distancing from Iran is being closely watched in Beijing.

3. An assumed "new mercantilism" and its implications

This reading aligns with what we called in our recent letters the "new mercantilism": a world in which states directly steer flows of raw materials, energy and capital, and where access to routes and resources becomes an instrument of power.

For a long-term investor, three implications stand out:

Structural premium for real assets tied to physical flows

Energy infrastructure (oil, gas, LNG), base and critical metals, logistics networks (ports, pipelines, terminals, electricity grids) are at the core of this contest. They benefit from:

• public-policy support (subsidies, long-term contracts, regulatory protection);
• but also a geopolitical risk premium (possible supply shocks or forced rerouting).

Diversification

The cost of resources is a threat to the major developed economies and to the assets of those zones, which make up most portfolios. In addition, each of the two contenders for global supremacy can in turn emerge as winner or loser. A well-diversified portfolio should therefore make significant room for Chinese assets on the one hand, and natural resources — energy first — on the other.

The "Great Rotation"

In a return to spheres of influence, capital should durably flow back to its origin zones. The United States, beneficiary of capital inflows from around the world since the early 20th century, is therefore in the medium-to-long term the main victim of likely capital repatriations. In the short term, by contrast, the search for safety will continue to benefit U.S. assets, offering a fresh opportunity for diversification at attractive prices.

In a world where the routes of oil, containers and ores have once again become instruments of power politics, diversification no longer plays out solely between asset classes, but between geopolitical regimes on the one hand, and between assets exposed to inflation and to growth on the other. The "Great Rotation" is the reversal of the dominant flows of recent decades.

Signed by Le Comité Stratégique