Market Update: Rival Nations Seize On Choke Points to Counter Trump – Full Analysis

President Trump has unapologetically wielded the power of the United States on the global stage, taking a much more belligerent approach economically and militarily to try to dictate the actions of other countries.

From high tariffs to the war with Iran, Mr. Trump has claimed that this aggressive behavior internationally has only upsides, and that past leaders were fools for refusing to tap into America’s power.

But one clear drawback of the strategy is emerging. While many countries have acceded to the president’s demands, some have found a highly effective new way to fight back. Mr. Trump’s aggression has given them the opportunity to test their control over choke points, threatening the United States and the global economy.

One such choke point is the Strait of Hormuz. Iran, which accounts for less than 1 percent of global economic output, has control over the shipping lane that transports a fifth of the world’s oil and gas. Its closure since the United States and Israel began attacking Iran at the end of February has blocked shipments of fuel, fertilizer and other goods, sending gas prices sharply higher and spreading anxiety among U.S. farmers and manufacturers.

Another experiment in retaliatory coercion began one year ago on Thursday, when Mr. Trump walked into the Rose Garden and unveiled tariffs on what he called “Liberation Day.” While many governments — even powerful economies like the European Union — complied with U.S. demands, China was a notable exception. Beijing rolled out a licensing system for exports of rare-earth minerals and magnets that has given China unparalleled control over the global manufacturing system.

Makers of cars, semiconductors, fighter jets and other goods — the backbone of a U.S. factory system that Mr. Trump wants to revive — depend on rare earths, most of which are processed in China.