By Jayasri Priyalal*
Singapore. 4 April 2026. (IDN): The trajectory of human civilization is often defined by the
rise and fall of great empires, each following a strikingly similar pattern of expansion,
overreach, and eventual collapse. Historical evidence suggests that the demise of these
powers is rarely a sudden event but rather a protracted unraveling triggered by the loss of
strategic maritime control, the mounting costs of perpetual warfare, and the accumulation
of unsustainable debt. As we navigate the heightened geopolitical tensions of 2026, the
parallels between the ailing empires of the past and the current global order become
increasingly difficult to ignore.
The Geopolitics of Strategic Waterways
Control over the world’s “choke points”—strategic canals and straits—has long been the
bedrock of imperial dominance. The Strait of Hormuz serves as a primary example. From
1515 to 1622, Portuguese conquerors dominated the seas and controlled this vital passage.
Their hegemony was eventually challenged by a coalition between the British East India
Company and the Persian ruler Shah Abbas, who seized the strait and maintained control
until the mid-20th century.
Britain’s imperial status was inextricably linked to its ability to secure sea routes,
specifically the route to India through the Persian Gulf and the Suez Canal. However, the
drain of two world wars left the British Empire heavily indebted. The nationalization of the
Suez Canal in 1956 marked a decisive turning point, signaling the first stage of the failure of
the British imperial mission and the subsequent loss of the Sterling Pound’s dominance in
global trade.
The Evolution of International Maritime Law
In the post-WWII era, a new international order emerged, championed by the United States
and the United Nations, with the goal of maintaining world peace and respecting territorial
integrity. A monumental shift occurred in maritime governance through the leadership of
Sri Lankan diplomat Hamilton Shirley Amerasinghe. As the architect of the “Constitution of
the Oceans” during the Third UN Conference on the Law of the Sea (UNCLOS 1973-1980),
Amerasinghe fostered a consensus that defined Exclusive Economic Zones (EEZ) and
established the “Common Heritage of Mankind”.
Despite the significance of UNCLOS, major powers have historically treated international
law with selective adherence. Both the Islamic Republic of Iran (1982) and the United
States (1994) signed the convention, yet neither has ratified it. This lack of commitment
has led to a failure to ensure the freedom of navigation through international straits, a
tension that has culminated in the hostilities of 2026 as the U.S. tries to mobilizes allies to
forcibly open the Strait of Hormuz.
The Contradiction of Founding Principles
The year 2026 marks the 250th anniversary of two seminal texts: Adam Smith’s The Wealth
of Nations and the American Declaration of Independence. Ironically, the current actions of
the American empire appear to work in direct opposition to the doctrines enshrined in
these documents. Smith’s “invisible hand” was intended to advance the broader good
through competitive markets, while the American founders expressed a clear preference
for non-interventionism and respect for sovereignty.
The unprovoked wars in West Asia in 2026 represent a departure from these founding
principles. Historical progress, fueled by the innovations of thinkers like Smith, Newton,
and Watt during the Industrial Revolution, has frequently been reversed by human greed
and the pursuit of absolute political and economic power. This “colonial agenda” has not
only resulted in human suffering but has also left the world to pay the price for
hydrocarbon emissions and climate change.
The Architecture of Debt and Reserve Currencies
The common thread among fallen empires is the reliance on debt to sustain power. From
the French Revolution and the Napoleonic wars to the twilight of the British Empire, over-
ambitious leaders have consistently used debt financing and taxation to fund their egoistic
visions.
When the British Pound lost its superiority as a reserve currency following WWII, the
Bretton Woods system (1944-1970) emerged, pegging major currencies to the U.S. dollar,
which was convertible to gold. The U.S. ascended as the new empire, fueled by its military-
industrial complex. However, this dominance was short-lived. Costly military interventions
in Korea, Vietnam, Laos, and Cambodia caused the war budget to soar and the debt level to
rise, making it impossible for the U.S. to maintain gold parity. In 1971, President Richard
Nixon unilaterally delinked the dollar from gold.
From Gold to “Black Gold”: The Petro-Dollar Era
To maintain its reserve currency status, the U.S. established the “Petro-Dollar” system,
mandating that petroleum exports be traded exclusively in U.S. dollars. This system, linked
to the SWIFT settlement network, allowed U.S. policymakers to continue increasing debt
levels while exercising geopolitical superiority through unilateral economic sanctions and
the freezing of foreign reserves.
This dominance is now being challenged by emerging economic powers. The BRICS alliance
is strengthening South-South cooperation and contemplating trade settlements in national
currencies to bypass the U.S.-dominated financial architecture. Even fossil-fuel-rich nations
like Venezuela have opted to trade oil in Chinese Yuan, though the continuing it is under a
cloud after the recent US intervention.
2026: The Intersection of War and Energy
As of 2026, the “Make America Great” (MAGA) movement continues to prioritize the
fossil fuel industry, disregarding climate change and scientific facts in favor of an illusory
vision of a “Great America” spanning from Panama to Greenland. While the U.S. is a net
energy exporter, the loss of "Black Gold" trading to the Yuan signifies a weakening empire.
The ongoing conflict in the Gulf threatens global stability. Economist Nouriel Roubini warns
that damage to oil production facilities could trigger 1970s-style stagflation, impacting
global equity markets and bond yields. If the destruction of infrastructure prevents the
supply of oil and gas to Asia, the world may see an accelerated shift toward renewable
energy or hydrogen-based fuels.
Conclusion: The Turning Tide
The history of empires teaches us that nothing is eternal. Just as the British Empire
diminished after two bloody wars and the loss of the Suez Canal, the current American era
faces a similar crossroads. The combination of soaring debt, unprovoked wars, and the
challenge to the Petro-Dollar suggests that the U.S. dollar-dominated global reserve regime
may be nearing its end. Change is inevitable; the only question remains whether this
transition will ultimately serve the better interests of humanity or lead to further
destruction.
* The author is currently a Director Asia-Pacific at UNI Global Union.