Implications of the US Transition to Energy Self-Sufficiency on its Middle East Strategy: Prospects for Weakened Commitment to Protecting the Strait of Hormuz and Shifting the Burden to Allies

Executive Summary

Key Messages

○ The U.S. transition to energy self-sufficiency has emerged as a fundamental variable in its Middle East strategy. - Since the shale revolution, the share of U.S. crude oil imports from the Gulf region has plummeted from 25% in 2014 to approximately 8% in 2025. - The U.S. has been a net energy exporter since 2020, and crude oil production reached an all-time high in 2025. - The direct economic motivation for the U.S. to protect the Strait of Hormuz has structurally weakened.

○ The U.S.-Iran armed conflict simultaneously exposed the strategic limits of U.S. energy self-sufficiency. - The Hormuz blockade drove a surge in global oil prices, reigniting domestic inflation and compounding domestic political burdens. - Rather than strengthening strategic patience, greater energy self-sufficiency functioned as a factor accelerating an early return to negotiations. - Allies must inevitably recalibrate their credibility assessments of U.S. willingness and staying power in the Middle East.

○ U.S. burden-shifting of sea lane protection onto allies is projected to be a structural and enduring trend. - The "America First" posture combined with rising energy self-sufficiency weakens the domestic political justification for protecting Gulf sea lanes. - Pressure on energy-importing states such as South Korea, Japan, and the EU for cost-sharing and military contributions is expected to intensify incrementally. - As China's strategic gains become structural, allies' strategic room for maneuver narrows amid deepening U.S.-China energy geopolitical competition.

○ South Korea, given its energy import dependence, is among the most directly vulnerable states. - With over 70% of crude oil imported from the Middle East, South Korea is directly exposed to a supply shock in the event of a Hormuz blockade. - The strategic dilemma is deepening between U.S. burden-shifting pressure and the need for diplomatic balance with Iran and Middle Eastern states. - It is urgent to develop a composite response strategy encompassing participation in multilateral maritime security cooperation, diversification of energy supply lines, and linkage to defense cost-sharing negotiations.

○ Beyond short-term crisis management, the structural redesign of energy security is South Korea's core task. - A three-tiered response system is needed: diversification of fossil fuel supply lines, restructuring of the power generation mix, and expansion of strategic reserves. - A strategic redefinition of how South Korea contributes to the alliance is required, attuned to shifts in how the U.S. exercises its energy leverage. - Energy security must be elevated to an integrated national strategy agenda spanning diplomatic, security, and economic policy.

I. Issue Situation Analysis

Strategic Implications for the Middle East of Increased U.S. Energy Self-Sufficiency and Weakened Gulf Energy Dependence

Issue Situation Analysis

1. Background and Progress of the Issue

■ Structural Transformation of the U.S. Energy Landscape

- Total U.S. petroleum production has increased more than fourfold since the 2008 financial crisis ^[3] - Crude oil production surged by over 250% during the same period ^[3] - The U.S. has been a net energy exporter since 2020, with crude oil production reaching an all-time high in 2025 - The share of crude oil imports from the Middle East Gulf region plummeted from 25% in 2014 to approximately 8% in 2025 - Rising U.S. energy self-sufficiency has structurally weakened its direct economic stake in Gulf sea lanes

■ Outbreak of the U.S.-Iran War and the Hormuz Blockade

- From late 2025 to early 2026, U.S. and Israeli strikes on Iran escalated into full-scale armed conflict ^[5] - Iran imposed a blockade of the Strait of Hormuz, cutting off roughly one-fifth of global crude oil supply ^[9] - During the blockade, Iran itself was unable to export a single barrel of crude ^[5] - Oil prices surged to their highest level since the Russia-Ukraine war, delivering the greatest shock on record to global energy markets ^[5][11] - Asian and European buyers sharply increased demand for U.S. crude to replace Persian Gulf supply ^[4]

■ Background to the U.S. Choice of Early Termination

- The oil price surge from the Hormuz blockade reignited inflationary pressure within the U.S. ^[8] - Fertilizer supply constraints raised concerns about pass-through to rising food prices ^[8] - Domestic political burdens intensified, including midterm election pressure - The Trump administration chose an early return to negotiations over strategic persistence - Greater energy self-sufficiency operated as a factor structurally limiting U.S. strategic patience

2. Current Situation (Latest Trends)

■ Diplomatic Negotiations Underway and the Reopening of Hormuz

- Indirect U.S.-Iran negotiations are proceeding via Doha, Qatar ^[7][14] - Qatar's Ministry of Foreign Affairs officially confirmed "positive progress" in the talks ^[14] - Vessel traffic through the Strait of Hormuz is showing a gradual recovery ^[10] - Oil prices fell for a third consecutive day, with Brent stabilizing around $70.80 per barrel ^[9] - The war premium on U.S. crude grades such as Mars has evaporated, falling to its lowest level since the pandemic ^[4]

■ Supply-Side Response

- OPEC+ agreed to an additional production quota increase of 188,000 barrels per day for August ^[13][16] - Cumulative increases from April through July total approximately 800,000 barrels per day ^[16] - The supply surge has revived concerns about a global crude oil glut ^[11] - U.S. energy companies are maintaining a posture of capital discipline and shareholder returns rather than aggressive drilling expansion ^[8] - The possibility of rescuing the market through a short-term production surge is structurally constrained

■ Acceleration of Asian Energy Policy Restructuring

- Asian policy authorities are urgently reassessing the expansion of energy buffers and diversification of supply lines ^[1] - Discussions have begun in earnest on diversifying fossil fuel supply lines and restructuring the overall power generation mix ^[1] - China demonstrated strategic resilience during the blockade by drawing on its energy reserves ^[6]

3. Key Actors and Positions/Interests

■ United States (Trump Administration)

- Interests: Energy self-sufficiency lowers Gulf dependence, but an oil price surge directly hits domestic inflation - Position: Early termination and a return to negotiations, structuring the transfer of sea lane protection burdens onto allies - Strategic Direction: Reduced Gulf involvement, with pressure on energy-importing states (South Korea, Japan, China) to share security costs

■ Iran

- Interests: Using the Hormuz blockade as negotiating leverage, demanding the release of $100 billion in frozen overseas assets ^[15] - Position: Maintaining its demand for transit fees, pursuing a negotiating strategy linked to the nuclear deal ^[15] - Strategic Direction: Turning the economic damage of the blockade to its advantage, maximizing U.S. incentives for early termination

■ China

- Interests: As the world's largest crude oil importer, its dependence on Hormuz is absolute ^[2] - Position: Absorbing short-term shocks through strategic reserves while maintaining a position of strategic advantage ^[6] - Strategic Direction: Leveraging weakened U.S. involvement in the Gulf as an opportunity to expand regional influence ^[6] - Accelerating the construction of an independent energy security system

■ Gulf Cooperation Council (GCC) States

- Interests: Having suffered direct attacks from Iran, they need to reassess the credibility of U.S. security commitments ^[12] - Position: Pursuing diversification of security partners away from unilateral reliance on the U.S. ^[12] - Strategic Direction: Seeking expanded security cooperation with China, Europe, and others

■ Japan and South Korea

- Interests: Overwhelmingly high Gulf dependence for crude oil imports, leaving them directly exposed to a Hormuz blockade - Position: Urgently pursuing diversification of energy supply lines and expansion of reserves ^[1] - Strategic Dilemma: U.S. pressure to shift sea lane protection burdens versus the limits of their own independent naval power projection capabilities

■ OPEC+

- Interests: Stabilizing oil prices and recovering market share after the end of the war - Position: Pursuing supply normalization and price stability through phased production increases ^[13][16]

4. Summary of Key Issues

■ Issue 1: Structural Weakening of U.S. Will to Intervene in the Gulf

- Greater energy self-sufficiency has reduced the direct economic motivation for protecting Gulf sea lanes - The choice of early termination reflects short-term political factors, but can be read as a manifestation of a structural disengagement tendency - In future crises of a similar kind, the continuity of U.S. military intervention cannot be assured

■ Issue 2: Shifting the Burden of Sea Lane Protection onto Allies

- The U.S. is structuring pressure to shift the cost of protecting Gulf sea lanes onto energy-import-dependent states - The likelihood of demands on South Korea and Japan to share deployment and patrol duties in the Strait of Hormuz is increasing - Refusal to share the burden risks being used as a bargaining chip in defense cost-sharing negotiations

■ Issue 3: China's Strategic Gains and U.S.-China Energy Security Competition

- China absorbed the blockade's impact through its reserves, demonstrating its energy security capabilities ^[6] - Weakened U.S. involvement in the Gulf represents an opportunity for China to expand its influence in the Middle East ^[6] - Within the structure of Hormuz dependence, China's vulnerability and strategic opportunity are exposed simultaneously

■ Issue 4: Restructuring of the Global Energy Market

- Accelerating diversification of supply lines and expansion of reserves across Asia will exert long-term downward pressure on Middle East dependence ^[1] - Expanded U.S. LNG and crude exports to Asia deepen the linkage between energy security and alliance relations - OPEC+ production increases combined with the reopening of Hormuz have raised near-term concerns about oversupply ^[11][16]

■ Issue 5: The Durability of Iran's Hormuz Blockade Leverage

- The learning effect that the blockade induced an early U.S. termination raises the likelihood of its future reuse - Repeated interim agreements without a permanent resolution will sustain structural instability - Whether negotiations linked to the nuclear deal are concluded is the key variable for medium- to long-term Hormuz stability

II. In-depth Issue Analysis

Strategic Implications for the Middle East of Increased U.S. Energy Self-Sufficiency and Weakened Gulf Energy Dependence

In-depth Issue Analysis

1. Analysis of the Root Causes of the Issue

■ The Structural Realignment of U.S. Energy Geopolitics Triggered by the Shale Revolution

- The commercialization of hydraulic fracturing since 2008 drove an explosive expansion of U.S. shale oil and gas production - Total petroleum production rose more than fourfold and crude oil production by over 250% ^[3] - The historic transition from energy import dependence to net exporter status was completed - The share of crude oil imports from the Gulf region plummeted from 25% in 2014 to approximately 8% in 2025 - The direct economic motivation for protecting Gulf sea lanes has structurally weakened - Greater U.S. energy self-sufficiency has narrowed the channel through which a Hormuz blockade directly damages the U.S. economy - However, the inflation channel linked to global oil prices still operates indirectly

■ Changing Behavior of U.S. Energy Companies

- Previously, high oil prices prompted aggressive drilling expansion, contributing to market stabilization through supply increases - Today, firms have shifted toward prioritizing capital discipline and shareholder returns ^[8] - Their role in rescuing the market through rapid short-term production increases is structurally constrained - This behavioral shift signals a change in how the U.S. exercises its energy leverage

■ The Structural Detonator of the U.S.-Iran Conflict

- Iran's nuclear program combined with regional hegemonic competition has produced decades of accumulated structural antagonism - Israel's security interests and U.S. alliance obligations sustain incentives for U.S. military intervention - Iran's Hormuz blockade card is repeatedly deployed as the core leverage of its asymmetric strategy - It controls roughly one-fifth of global oil supply ^[9] - Yet under blockade Iran itself cannot export a single barrel, creating a structure of mutually assured damage ^[5]

2. Structural Context

■ Political Structure

- The Trump administration's "America First" posture has intensified pressure on allies to share burdens - The Hormuz blockade drove oil prices up, reigniting U.S. inflation and midterm election pressure ^[8] - Domestic political costs structurally constrain the will for strategic persistence - Greater energy self-sufficiency weakens the domestic political legitimacy of Middle East intervention - Public pressure is mounting around the question of why the U.S. should protect other countries' oil transport routes - The U.S. choice of early termination prioritized a return to negotiations over strategic patience ^[7]

■ Economic Structure

- As a net energy exporter, the U.S. sees its energy companies benefit from oil price surges - Yet the macroeconomy overall suffers through inflation and consumption contraction - The Hormuz blockade drove a surge in Asian and European demand for U.S. crude ^[4] - Premiums on U.S. crude exports spiked, delivering short-term gains to the U.S. energy industry during the war - After the blockade lifted, the supply surge revived concerns about a global crude glut ^[11] - OPEC+ production increases (cumulatively about 800,000 barrels per day from April to July) added downward pressure on prices ^[16] - Fertilizer supply constraints passed through to rising food prices, broadening inflationary pressure ^[8] - An immediate Fed rate hike is unlikely, but uncertainty persists ^[8]

■ Security Structure

- Reduced U.S. dependence on Gulf energy has weakened its direct motivation to protect sea lanes - The beneficiaries of Hormuz protection are Asian energy importers: China, Japan, South Korea, and India - China, the world's largest importer of both crude oil and LNG, is overwhelmingly dependent on Hormuz ^[2] - During the blockade, China buffered short-term shocks through energy stockpiles ^[6] - Over the longer term, its strategic vulnerability is exposed, creating incentives to accelerate naval expansion - U.S. pressure to shift sea lane protection burdens is likely to become structured - Demands on allies such as Japan, South Korea, and Australia for cost-sharing and military contributions are expected to grow - GCC states are accelerating efforts to diversify security partnerships beyond exclusive reliance on the U.S. ^[12]

3. Historical Precedents and Comparable Cases

■ The 1973-1974 Arab Oil Embargo (Oil Shock)

- The embargo by Arab oil producers against the U.S. and the West delivered a direct blow to the U.S. - At the time, high U.S. dependence on energy imports maximized its strategic vulnerability - The result was the formation of a direct and structural motivation for U.S. intervention in Middle East energy security - The Carter Doctrine (1980) formalized defense of the Gulf region as a core U.S. national interest - Difference from the present: Greater energy self-sufficiency has structurally blocked that same channel of direct damage

■ The 1980-1988 Iran-Iraq War and the Tanker War

- Attacks on tankers by both Iran and Iraq repeatedly threatened transit through Hormuz - The U.S. provided direct escort through the reflagging of Kuwaiti tankers - High U.S. dependence on Gulf energy at the time made direct intervention easy to justify - Difference from the present: After the transition to energy self-sufficiency, comparable direct intervention is far harder to justify

■ The 1990-1991 Gulf War (Iraq's Invasion of Kuwait)

- Iraq's occupation of Kuwait threatened Saudi Arabia, producing a global energy security crisis - A U.S.-led multinational coalition combined the rationales of energy security and upholding international norms - Allies such as Japan and Germany faced demands for financial contributions, with Japan contributing $13 billion - Financial contributions without military involvement drew criticism as "checkbook diplomacy" - Implications for the present: This historical precedent of burden-shifting pressure could be repeated with South Korea and Japan

■ The 2019 Hormuz Crisis and the International Maritime Security Construct (IMSC)

- Iran's seizure of and attacks on tankers prompted the U.S. to lead the formation of the IMSC - Allies including South Korea and Japan came under pressure to participate - South Korea avoided direct participation in the U.S.-led coalition by independently deploying its Cheonghae Unit - Implications for the present: The U.S. burden-shifting mechanism has already entered an institutionalization phase

■ The Post-Cold War NATO Defense Burden-Sharing Debate

- The U.S. defense burden in Europe repeatedly raised the problem of allied free-riding - During Trump's first term, pressure to meet 2% of GDP in defense spending set a precedent for alliance restructuring pressure - Extension to Gulf sea lanes: The same logic of demanding cost-sharing from energy beneficiaries applies

4. Key Variables in the Issue's Development

■ Variable 1: Whether U.S. Energy Self-Sufficiency Is Sustained

- The cost structure of shale production and whether energy companies maintain capital discipline ^[8] - Falling oil prices erode shale profitability, creating uncertainty about sustaining self-sufficiency - Whether the U.S. retains its energy export competitiveness bears on the latent possibility of renewed Gulf dependence

■ Variable 2: U.S.-Iran Nuclear Negotiations and the Level of Regional Stabilization

- Whether the indirect Doha negotiations reach a substantive agreement ^[7][14] - The clash between permanent reopening of Hormuz and Iran's demand for transit fees ^[15] - The extent to which Iran's nuclear program is frozen or dismantled is the key variable for restructuring the regional security architecture - Should negotiations fail, the risk of a renewed blockade persists, sustaining energy market uncertainty

■ Variable 3: China's Energy Security Strategy Response

- China's overwhelming Hormuz dependence exposes its strategic vulnerability ^[2][6] - Whether China accelerates naval expansion and secures alternative energy routes - If China expands an independent role in Gulf security, a new front in U.S.-China strategic competition will open - This is linked to GCC states' moves toward diversifying security partnerships ^[12]

■ Variable 4: Whether Allies Accept Burden-Sharing

- The intensity and specific form of U.S. pressure to shift sea lane protection costs - The level of demand for financial versus military contributions such as naval deployments - The pace at which Japan, South Korea, and Australia build independent maritime security capabilities - Domestic political acceptability within allied states, including public opinion and parliamentary consent for deployments

■ Variable 5: The Pace of the Global Energy Transition

- The speed at which renewable energy and electric vehicle adoption reduce Asian states' fossil fuel dependence ^[1][2] - As Hormuz dependence declines structurally, the political efficacy of burden-shifting pressure weakens - In the near term, continued fossil fuel dependence means energy security vulnerabilities will persist

III. Analysis of Response Measures

Strategic Implications for the Middle East of Increased U.S. Energy Self-Sufficiency and Weakened Gulf Energy Dependence

Analysis of Response Measures

1. Scenario Setting

■ Scenario A: Accelerated U.S. Burden-Shifting of Gulf Sea Lane Protection - The U.S. progressively transfers the role of protecting Gulf sea lanes such as Hormuz to its allies - Pressure intensifies on energy-importing states including South Korea, Japan, and the EU for cost-sharing and military contributions - As a net energy exporter, the U.S. sustains a structurally reduced incentive for direct intervention

■ Scenario B: Renewed U.S.-Iran Conflict and a Second Hormuz Blockade - Collapsed nuclear negotiations or renewed regional military conflict make a second Hormuz blockade a reality - Global oil prices surge again, reproducing supply shocks for Asian energy importers ^[1] - Uncertainty is maximized regarding the intensity and durability of U.S. military intervention

■ Scenario C: A Durable U.S.-Iran Agreement and the Restructuring of the Gulf Energy Order - Institutionalization of the nuclear deal and the reopening of Hormuz resolve the near-term energy crisis - Gulf states accelerate the diversification of their security partners ^[12] - China's strategic gains become structural, deepening U.S.-China energy geopolitical competition ^[6]

2. Response Options and Their Pros and Cons by Scenario

■ Response to Scenario A: Countering Pressure to Shift Sea Lane Protection Burdens

○ Option A-1: Expanding Participation in Multilateral Maritime Security Cooperation

- Content - ROK Navy participation in maritime security missions near Hormuz within a multilateral framework - Limited contribution to the U.S.-led Combined Maritime Forces (CMF) or to a new multilateral mechanism - Distributing political burdens by working through a multilateral framework rather than independent deployment

- Advantages - Enables a visible contribution in response to U.S. burden-sharing demands - Offers an opportunity to accumulate ROK Navy blue-water operational capability - A multilateral framework minimizes exposure to direct conflict with Iran

- Disadvantages - Risk of diplomatic friction with Iran and Middle Eastern states persists - Domestic political controversy makes it difficult to secure legitimacy for deployment - A gap may emerge between the level of contribution the U.S. expects and what South Korea provides

- Feasibility: ★★★☆☆ - Existing capabilities such as Cheonghae Unit operational experience can be leveraged - However, expanding the mission's scope would require National Assembly approval

○ Option A-2: Linking Energy Security Contributions to Defense Cost-Sharing Negotiations

- Content - Present energy security contributions as a package in USFK defense cost-sharing negotiations - Negotiate sea lane protection contributions as an in-kind substitute for defense cost-sharing - Participate in the joint design of the U.S. Indo-Pacific energy security initiative

- Advantages - Secures negotiating leverage in defense cost-sharing talks - Converts energy security contributions into a strategic asset - Manages U.S. burden-shifting demands within a structured negotiating framework

- Disadvantages - Negotiating power is limited if the U.S. prefers cash contributions - Difficulty in quantifying the value of energy security contributions - Should negotiations fail, there is a risk of a dual burden of defense costs plus energy contributions

- Feasibility: ★★★☆☆ - Given the Trump administration's transactional diplomacy, package negotiations may be acceptable - However, U.S. willingness to negotiate remains uncertain

○ Option A-3: Reducing Gulf Dependence Itself Through Supply Line Diversification

- Content - Phased expansion of the share of U.S. LNG and crude oil imports - Strengthening a non-Middle East supplier portfolio including Australia, Canada, and Norway - Expanding the domestic Strategic Petroleum Reserve (SPR) and upgrading emergency supply systems

- Advantages - Lower Gulf dependence directly reduces exposure to Hormuz risk - Expanded U.S. energy imports can serve as a card for easing the U.S.-ROK trade imbalance - Supply line diversification structurally strengthens energy security ^[1]

- Disadvantages - U.S. LNG may be less price-competitive than Middle Eastern supply - Switching supply lines requires long-term contracts and infrastructure investment - Complete departure from Gulf dependence is unrealistic in the short to medium term

- Feasibility: ★★★★☆ - Consistent with the ongoing expansion of U.S. LNG contracts - Aligned with the Trump administration's push to expand energy exports

■ Response to Scenario B: Absorbing the Shock of a Second Hormuz Blockade

○ Option B-1: Expanding Strategic Reserves and Strengthening Emergency Supply Networks

- Content - Set a target to raise strategic petroleum reserve coverage from 90 days to over 120 days - Establish an emergency supply coordination mechanism among IEA member states in advance - Conclude long-term supply contracts with non-Middle East suppliers in advance

- Advantages - Directly buffers the supply shock in the early stage of a blockade - Suppresses market panic and helps defend against oil price surges - IEA coordination allows the cost burden to be distributed rather than borne alone

- Disadvantages - Reserve expansion requires substantial fiscal cost - Under a prolonged blockade, vulnerability re-emerges once reserves are depleted - The actual speed and scale of emergency coordination remain uncertain

- Feasibility: ★★★★☆ - The existing IEA framework provides an institutional foundation - The pace of reaching reserve targets can be adjusted to fiscal conditions

○ Option B-2: Pre-establishing an Emergency Supply Line Switching System

- Content - Prepare protocols for immediate switching to alternative suppliers in the U.S., Australia, and Africa upon a blockade - Conclude emergency procurement contracts with domestic refiners and energy public corporations in advance - Establish a hedging system for the additional logistics costs of detour routes such as the Cape of Good Hope

- Advantages - Shortens response time when a blockade occurs - Advance contracts partially hedge against price surge risk - Secures practical implementation capacity for supply chain diversification

- Disadvantages - Advance contracts carry maintenance costs and limit contractual flexibility - Detour routes extend transit times and sharply raise costs ^[1] - Securing sufficient volume from alternative suppliers remains uncertain

- Feasibility: ★★★☆☆ - Requires designing commercial incentives for private energy companies - Establishing a government-private cooperation framework in advance is the decisive factor

○ Option B-3: Reducing Structural Vulnerability Through Renewables and Nuclear Power

- Content - Accelerate new nuclear construction and Small Modular Reactor (SMR) development - Expand the renewable share of power generation to reduce fossil fuel dependence in the electricity sector - Accelerate the energy mix transition in conjunction with the hydrogen economy roadmap

- Advantages - Structurally strengthens energy security over the medium to long term - Ensures policy consistency with carbon neutrality goals - Provides a path to fundamentally reducing Gulf dependence

- Disadvantages - Short-term effects are negligible, offering no immediate response to a blockade shock - Expanding nuclear and renewable capacity requires enormous investment and time - Linking the power and transport sectors in this transition requires social consensus

- Feasibility: ★★★☆☆ - The direction is established as medium- to long-term energy transition policy - However, its limits as a short-term crisis response tool are clear

■ Response to Scenario C: A Durable U.S.-Iran Agreement and the Restructuring of the Gulf Order

○ Option C-1: Deepening Energy and Economic Cooperation with Gulf States

- Content - Leverage the GCC states' trend toward diversifying security partners ^[12] - Negotiate energy cooperation and infrastructure investment packages with Saudi Arabia, the UAE, and others - Participate in Gulf states' decarbonization transition investments, including nuclear and hydrogen cooperation

- Advantages - Aligns with Gulf states' demand for partner diversification - Secures both energy supply stability and economic cooperation returns - Creates opportunities to deploy South Korea's construction, plant, and nuclear capabilities

- Disadvantages - Friction is possible as the U.S. restructures its Gulf alliance relationships - Competition arises with deepening Gulf-China cooperation ^[6] - Regional instability could materialize investment risk

- Feasibility: ★★★★☆ - South Korea's existing network in Middle East construction and energy cooperation can be leveraged - Aligned with Gulf states' economic diversification demand under initiatives such as Vision 2030

○ Option C-2: Responding to China's Strategic Gains and Managing Energy Geopolitical Competition

- Content - Build an independent supply chain risk assessment system for China's expanding influence in Gulf energy - Strengthen energy supply chain coordination with the U.S., Japan, and Australia ^[6] - Pursue parallel diversification of supply chains for China-dependent energy technologies such as rare earths and batteries

- Advantages - Enables proactive risk management for shifts in energy geopolitics - Strengthens the energy security coordination network with allies - Structurally reduces risk from China-dependent energy technologies

- Disadvantages - Risks damaging economic cooperation with China - Restructuring energy supply chains requires enormous cost and time - Interests among allies may diverge

- Feasibility: ★★★☆☆ - Aligned with U.S. pressure and direction on supply chain restructuring - However, the pace and scope must be calibrated in light of ROK-China economic relations

○ Option C-3: Seeking a Diplomatic Role in Rebuilding the Iran Nuclear Deal

- Content - Explore a mediating or facilitating role in the process of rebuilding the U.S.-Iran nuclear deal - Prepare in advance for resuming energy cooperation with Iran following sanctions relief - Support the institutionalization of Hormuz stabilization through multilateral diplomatic channels

- Advantages - Secures potential access to Iranian crude as part of supply line diversification - Creates independent space for a South Korean role in Middle East diplomacy - Contributing to regional stabilization structurally improves energy security

- Disadvantages - Risks collision with the hardline U.S. and Israeli posture toward Iran - Carries legal and diplomatic risk of violating Iran sanctions - A breakdown in negotiations could damage diplomatic credibility

- Feasibility: ★★☆☆☆ - Under the current U.S. administration's posture, independent diplomatic space is severely limited - Should be held in reserve as a medium- to long-term option

3. Comprehensive Risk Assessment Matrix

4. Priority Response Measures by Scenario

■ Scenario A (Burden-Shifting Pressure): Top Priority Responses

- 1st Priority: Structurally reduce Gulf dependence through supply line diversification, including expanded U.S. LNG and crude imports - Link this to the card of easing the U.S.-ROK trade imbalance to maximize diplomatic effect - 2nd Priority: Offer a visible response to U.S. demands through limited and selective participation in multilateral maritime security cooperation - Minimize political costs by working through a multilateral framework rather than independent deployment - 3rd Priority: Include energy security contributions in the defense cost-sharing package to enhance negotiating leverage

■ Scenario B (Renewed Blockade Shock): Top Priority Responses

- 1st Priority: Expand strategic petroleum reserves to over 120 days and strengthen IEA coordination mechanisms in advance - This has the most direct effect in suppressing market panic in the early stage of a blockade - 2nd Priority: Establish emergency switching protocols and advance contracting arrangements with non-Middle East suppliers - Institutionalize a government-private emergency supply chain cooperation framework - 3rd Priority: Pursue in parallel the reduction of medium- to long-term structural vulnerability through nuclear, SMR, and renewable expansion

■ Scenario C (Order Restructuring): Top Priority Responses

- 1st Priority: Deepen energy and infrastructure cooperation by leveraging GCC states' demand for partner diversification ^[12] - Present nuclear, hydrogen, and construction capabilities as a package offering - 2nd Priority: Respond to China's strategic gains by strengthening energy supply chain coordination with allies ^[6] - Expand participation in energy security consultative bodies with the U.S., Japan, and Australia - 3rd Priority: Monitor the process of rebuilding the Iran nuclear deal and prepare options for resuming cooperation after sanctions relief

5. Key Strategic Implications for South Korea

■ Short Term (1-2 Years)

- Immediately strengthen strategic petroleum reserves and the IEA coordination framework - Expand U.S. LNG contracts to secure both supply line diversification and trade negotiating leverage - Begin a preliminary review of the scope and conditions for participation in multilateral maritime security cooperation

■ Medium Term (3-5 Years)

- Set target shares for a non-Middle East supplier portfolio and achieve them in phases - Concretize energy transition cooperation packages with GCC states - Pursue a composite diplomatic strategy linking nuclear and SMR exports to energy security cooperation

■ Long Term (5+ Years)

- Structurally reduce dependence on Gulf fossil fuels through renewable and nuclear expansion - Raise supply chain self-sufficiency in energy technologies such as hydrogen, SMRs, and batteries - Establish South Korea's role within the multilateral cooperation architecture for Indo-Pacific energy security

References

[1] [Business Times (SG)] Energy-hungry Asia is already drawing lessons from Iran crisis

[2] [The Diplomat] What Hormuz and Chinese Sources Reveal About Beijing's Energy Strategy

[3] [Gulf News] Iran warns oil tankers in Strait of Hormuz as next US talks are delayed until after Khamenei's funeral

[4] [Financial Post] US Crude Grades Shed Iran War Premium as Energy Crisis Eases

[5] [Al Jazeera] 'Never the same': How war on Iran changed the global energy sector

[6] [Nikkei Asia] China is a winner of Iran conflict: Asia hand Kurt Campbell

[7] [The New York Times] After Trading Attacks, U.S. and Iran Edge Back Toward Diplomacy

[8] The Korea Economic Daily HANKYUNG PREMIUM 9

[9] [Geo News] Oil falls for a third straight day after US-Iran talks conclude in Doha

[10] [National Post] Strait of Hormuz tanker trafficking rebounding a day after unexplained U-turns

[11] [Financial Post] Oil's Stunning Reversal Rekindles Fears of a Global Glut

[12] [Al Jazeera] How US-Iran war may push Gulf countries to 'diversify' security alliances

[13] [The News International] OPEC+ boosts oil output again as Strait of Hormuz exports recover

[14] [Al-Monitor] Oil falls below $71 as US-Iran talks continue, Gulf exports rebound

[15] [The Wall Street Journal] U.S. Dangles Rewards for Opening the Strait of Hormuz. Iran Isn't Budging.

[16] [Arabian Business] OPEC+ agrees August output hike as oil prices fall to pre-war levels