The Weaponisation of Interdependence: How Trade, Energy and Intelligence Became Instruments of Power

Executive Summary

Globalisation has created an international system in which prosperity depends on interconnected networks: energy corridors, shipping routes, financial infrastructure, technology supply chains and information systems. These connections lower costs and expand economic opportunity. They also create vulnerabilities.

States increasingly recognise that influence can be exercised without occupying territory or defeating an adversary militarily. A government may restrict access to financial infrastructure, control the export of critical technologies, exploit a maritime chokepoint or provide intelligence that improves an ally's capacity to strike a strategic target. The objective is to change another actor's available choices by manipulating the networks on which it depends.

This is the strategic logic of weaponised interdependence. Henry Farrell and Abraham Newman established the influential framework in their 2019 research on the power embedded in global economic networks. Subsequent research has examined how coercion encourages countries and firms to reroute trade, develop substitutes and invest in alternative infrastructure.

Developments in October 2026 illustrate the problem. Attacks on commercial shipping around the Strait of Hormuz have demonstrated how maritime insecurity can disrupt energy markets. The changing relationship between Russian fuel exports and US-mediated diplomacy over Ukraine illustrates how energy access can become part of a bargaining arrangement. Reporting on Russian satellite activity around locations subsequently targeted by Iran-backed groups raises a related, but distinct, question: how intelligence infrastructure can extend influence across regional conflicts.

These developments do not establish a single coordinated strategy linking all the actors involved. Their significance lies in the broader pattern: control over access, connectivity and information is becoming an increasingly important source of strategic power.

Yet coercion carries a long-term cost. The more frequently states weaponise critical networks, the stronger the incentive for others to build alternatives. Interdependence can produce leverage, but exercising that leverage may gradually undermine the dependence that makes it valuable.

Executive Signals

- Connectivity creates leverage. Strategic power increasingly resides in the ability to control access to essential networks, not simply in ownership of territory or resources.

- Economic and military pressure are converging. Energy access, maritime disruption, sanctions and intelligence cooperation can shape the same geopolitical bargaining environment.

- The costs travel beyond the target. Coercion can raise prices, disrupt supply chains and impose costs on businesses and consumers in countries not directly involved in a dispute.

- Adaptation changes the balance of power. Alternative suppliers, transport routes, payment systems and intelligence partnerships can reduce future dependence, although often at significant cost.

- The decisive question is durability. A measure that imposes immediate costs may not deliver lasting political concessions—and can encourage the target to become harder to pressure next time.

1. From economic integration to strategic exposure

For much of the post-Cold War period, economic integration was generally treated as a stabilising force. Countries that traded extensively with one another had incentives to preserve commercial relationships, while firms organised production around efficiency, scale and predictable access to global markets.

The assumption was not that economic relationships would eliminate geopolitical rivalry. It was that the costs of disrupting those relationships would help restrain it.

That assumption has become less reliable.

The same networks that create mutual benefits can generate asymmetric dependence. A country may rely heavily on an external supplier for fuel, on a small number of producers for advanced components, on foreign financial institutions for international payments or on a limited number of maritime corridors for trade. If another actor can control or interrupt one of these connections, an ordinary commercial relationship becomes a potential source of political leverage.

Farrell and Newman identify two particularly important forms of network power. A state positioned at a central point in a network may gain access to valuable information flowing through it. Alternatively, it may be able to restrict an adversary's access to that network. Their framework helps explain why financial infrastructure, technology standards and cross-border commercial systems can become instruments of statecraft.

The crucial distinction is between possessing a resource and controlling the conditions under which others can obtain or use it.

An oil producer may influence markets through production decisions. A state with influence over a critical shipping corridor may affect the cost and reliability of delivering that oil. A government controlling a key financial or technological gateway may have leverage even without producing the underlying commodity.

In each case, power derives partly from the dependence of others.

2. The Strait of Hormuz: when geography becomes leverage

The Strait of Hormuz illustrates the vulnerability of physical networks.

The narrow waterway connects the Persian Gulf to the Gulf of Oman and the wider Indian Ocean. Before the current war with Iran, it carried approximately one-fifth of global oil and liquefied natural gas trade, making its security important well beyond the Middle East.

On 23 October, Reuters reported that October had become the most intense month on record for attacks on commercial shipping in the strait and surrounding waters since the conflict began. The Washington Institute's tracking recorded 28 confirmed and reported attacks during October and 113 since the war began on 28 February. Reuters also reported that more than 30 very large crude carriers had been damaged during the conflict, based on its review of maritime incident data. The figures reflect recorded and reported incidents; incomplete reporting means the true total may differ.

The significance extends beyond the ships directly damaged.

When vessels face elevated risks, shipowners and insurers reassess whether a voyage is commercially viable. Insurance premiums, freight rates, security costs and the prospect of delays can change even when a vessel is not attacked. Buyers may seek alternative suppliers, while exporters may have to offer discounts to compensate for risk.

The result is a wider economic shock generated by insecurity at a geographically concentrated point.

For Iran, the capacity to threaten shipping can create leverage over states that depend on Gulf energy flows and over governments seeking to end the conflict. But this leverage is not cost-free. Disrupted exports can also damage regional economies, undermine confidence in maritime commerce and encourage importers to diversify their energy supplies.

Nor does the ability to threaten a chokepoint amount to complete control over it. Naval power, surveillance, diplomatic arrangements, alternative routes and the willingness of commercial operators to accept risk all affect how much leverage can actually be exercised.

The broader lesson is that a chokepoint becomes strategically powerful when disruption there imposes costs on actors that cannot readily avoid it. Geography provides the opportunity; dependence determines the scale of the leverage.

3. Energy access as a bargaining instrument

Energy is particularly susceptible to weaponisation because it combines immediate economic necessity with strategic importance.

Oil and gas underpin transport, industrial production, electricity generation and the movement of goods. Supply disruptions can therefore affect inflation, business costs and political confidence. Governments cannot always wait for new infrastructure or alternative suppliers to become available before responding.

This makes energy relationships useful in geopolitical bargaining. Producers can influence supply, transit states can affect access, and governments can use restrictions or exemptions to change the commercial choices available to other actors.

Recent developments involving Russia illustrate the relationship between energy and diplomacy.

On 27 October, Reuters reported that Russian refineries had increased crude processing in the second half of October following a pause in Ukrainian drone attacks on refinery sites. The report linked the pause to US efforts to revive peace talks and secure a diesel supply arrangement, after

President Donald Trump announced an “energy ceasefire” on 11 October. Russian authorities reported that attacks had ceased after mid-October, while industry sources described a recovery in refinery output and the potential for renewed exports.

The reported sequence illustrates how energy infrastructure, military operations and diplomatic negotiations can intersect. It does not, by itself, establish every term of the arrangement or prove that energy access alone determined the parties' decisions.

The wider point is that energy can serve two functions simultaneously: it is a commodity exchanged for economic value, and a strategic asset whose availability can influence the political environment.

For governments facing fuel shortages or price instability, securing supplies may become a priority even when the supplier is also a geopolitical adversary. For exporters, access to buyers and transport infrastructure can preserve revenue and political influence. For third countries, the resulting shifts can create opportunities to negotiate favourable terms—or expose them to new dependencies.

This is where energy coercion becomes more complicated than a simple contest between supplier and consumer. The same commercial relationship that gives one party leverage may give the other a reason to diversify, stockpile, subsidise domestic production or develop new infrastructure.

The immediate bargaining advantage may be real. Its durability is a separate question.

4. Intelligence networks extend influence beyond borders

The logic of interdependence is not confined to commodities or finance. It also applies to information.

Modern military operations depend on satellite imagery, communications, surveillance, navigation and the ability to interpret large volumes of data. Access to these capabilities can improve targeting, reduce uncertainty and extend the operational reach of actors that lack comparable independent infrastructure.

An Associated Press investigation published on 27 October reported that Russian reconnaissance satellites repeatedly orbited areas around certain attacks attributed to Iran-backed groups between July and October. The investigation described patterns around locations including Saudi oil infrastructure and King Fahd Air Base. Officials and analysts cited by AP alleged that satellite- derived intelligence was being passed through relationships involving Iranian advisers and allied groups. However, the reported orbital patterns do not independently prove that intelligence was transferred or establish the exact chain through which any information reached an attacker.

That distinction matters. Satellite activity over a location is evidence of observation, not conclusive evidence of operational support. Establishing the latter requires additional evidence about data access, transfer, interpretation and use.

Nevertheless, the reporting raises a significant strategic question: how can states project influence through capabilities that partners or aligned groups can use, rather than through direct military deployment?

Intelligence cooperation can provide a partner with capabilities it would otherwise struggle to acquire. It can also complicate attribution, allowing the contributing state to influence events without openly commanding the operation. But the arrangement introduces risks: the recipient may

act in ways the provider did not intend, sensitive capabilities may be exposed, and alleged involvement may generate diplomatic or military retaliation.

The connection to economic networks is conceptual rather than identical. A shipping chokepoint controls movement; a financial gateway can control transactions; an intelligence network can influence what an actor knows and what it can do with that knowledge. Each creates strategic value through unequal access to a critical system.

The lesson is not that all forms of interdependence are interchangeable. It is that dependence on another actor's infrastructure can create leverage even when that actor does not directly control the final outcome.

5. The hidden cost: coercion encourages alternatives

If interdependence creates leverage, why not use it whenever a strategic opportunity appears?

Because the use of leverage changes the behaviour of the target.

A government that faces repeated supply restrictions has stronger incentives to seek alternative suppliers. A company exposed to sanctions risk may redesign its supply chain. A state dependent on one maritime corridor may invest in storage, pipelines, ports or alternative routes. Financial restrictions can encourage the development of new settlement arrangements, although building credible alternatives to established systems is difficult and expensive.

Recent research on US–China economic competition finds that repeated use of trade restrictions, sanctions and export controls can encourage production relocation, trade rerouting and the development of substitutes. These responses do not necessarily eliminate the original power imbalance, but they can reduce the effectiveness of future coercive measures and raise the cost of enforcement.

This is the paradox of weaponised interdependence: a state may gain leverage from a network today while encouraging the development of alternatives that reduce its leverage tomorrow.

The adjustment is rarely immediate. New infrastructure requires investment, alternative suppliers may lack capacity, and replacement technologies may be less efficient. Financial networks also benefit from established liquidity, trust and widespread adoption, making them difficult to replace quickly.

In some cases, coercion strengthens the original network's centrality because there is no viable substitute. In others, it accelerates fragmentation.

The outcome depends on the target's resources, the availability of alternatives, the duration of the pressure and the willingness of third parties to provide access.

There is also a distinction between reducing vulnerability and achieving independence. A country that diversifies its energy imports may still be exposed to global price movements. A firm that relocates production may remain dependent on the same raw materials or transport infrastructure. A new payment channel may reduce reliance on one intermediary without matching the reach of the established system.

Resilience therefore tends to come from redundancy and diversification, not from the elimination of interdependence.

6. Why middle powers face a different calculation

The strategic choices available to major powers are not equally accessible to smaller states or middle powers.

A large economy may have the fiscal capacity to subsidise domestic production, maintain strategic reserves, finance alternative infrastructure or absorb temporary supply shocks. A smaller import- dependent economy may have fewer options and less bargaining power.

Yet middle powers are not necessarily passive. They can diversify partnerships, become indispensable intermediaries, invest in infrastructure that connects competing markets or coordinate with other states to reduce their exposure. Their influence may come from providing alternatives rather than controlling the original network.

This creates a more complex international order than a simple contest between dominant powers. States that control critical nodes retain substantial leverage, but intermediary economies can gain influence by offering routes, suppliers, financial access or logistical capacity that others need.

The recent literature on weaponised connectivity highlights precisely this dynamic: coercion can reshape the position of intermediary economies and encourage the emergence of new hubs. The resulting order may redistribute leverage rather than eliminate it.

For businesses, the implications are equally important. A supply chain that is efficient under normal conditions may be strategically fragile if it depends on a single route, jurisdiction or supplier. The relevant calculation is no longer simply the lowest cost of procurement. It also includes the cost of interruption, the time required to recover and the possibility that access will be restricted for political reasons.

For governments, the challenge is to strengthen resilience without making every commercial relationship a security concern. Excessive duplication, protectionism and indiscriminate restrictions can impose costs of their own, weakening the efficiency and innovation that made international integration valuable.

The objective should not be autarky. It should be a more deliberate balance between efficiency and strategic exposure.

Consequences and Strategic Implications

The weaponisation of interdependence is changing how states assess economic relationships. Its consequences extend across diplomacy, national security, investment and the organisation of global commerce.

First, economic security is becoming part of national security. Governments can no longer treat critical supply chains, energy corridors and financial infrastructure as purely commercial matters. Their reliability can influence a country's freedom of action during a crisis.

Second, coercive power depends on the availability of substitutes. A state that controls a critical network has greater leverage when alternatives are scarce. As substitutes emerge, the balance changes. The strategic value of a network is therefore not fixed; it depends on the choices available to those who rely on it.

Third, the costs of geopolitical rivalry are increasingly distributed. A restriction imposed on one country can affect suppliers, insurers, manufacturers, shipping operators and consumers elsewhere. These spillovers can generate pressure for negotiation, but they can also create new political divisions among partners.

Fourth, resilience will become a competitive advantage. Businesses and governments that can maintain operations during disruption may enjoy greater strategic autonomy. Diversification, reserve capacity, trusted partnerships and contingency planning are increasingly relevant to competitiveness, not merely crisis management.

Finally, coercion can produce diminishing returns. Pressure may extract short-term concessions, but repeated use can encourage targets to invest in alternatives, deepen relationships with rival powers or accept higher costs to reduce dependence. The outcome is not necessarily a more fragmented world in every sector, but a world in which access is increasingly evaluated through a security lens.

The strategic challenge is to distinguish between leverage that can produce a durable change in behaviour and leverage that merely accelerates adaptation.

Forward Indicators

The following developments will help determine whether weaponised interdependence becomes a more entrenched feature of international competition.

1. Maritime security and shipping costs

What to watch: Whether attacks around the Strait of Hormuz persist, whether commercial traffic recovers, and whether insurance and freight costs remain elevated. A prolonged disruption would indicate that threats to a chokepoint can exert economic pressure beyond the immediate conflict.

2. Energy diplomacy

What to watch: Whether the reported US-mediated arrangements involving Russian fuel and refinery security develop into a broader, verifiable negotiating framework. The terms and durability of any arrangement will matter more than the announcement alone.

3. Trade and financial diversification

What to watch: Whether governments and firms commit substantial resources to alternative suppliers, routes, payment infrastructure and critical technologies. Announced initiatives should be distinguished from operational capacity.

4. Intelligence-sharing evidence

What to watch: Whether further credible reporting establishes the transfer and use of satellite-derived intelligence in regional attacks. Verified evidence would clarify how information infrastructure contributes to indirect power projection.

5. The behaviour of intermediary states

What to watch: Whether middle powers strengthen their role as alternative suppliers and commercial hubs, or instead face increasing pressure to align with competing blocs. Their choices may reveal how much room remains for strategic hedging.

6. The economic cost of resilience

What to watch: Whether governments can reduce critical dependencies without imposing excessive fiscal costs, weakening competitiveness or simply transferring dependence to another supplier. This will help establish whether diversification is producing genuine resilience or merely rearranging vulnerabilities.

Assessment

The weaponisation of interdependence is not the end of globalisation. It is a change in how globalisation is understood and used.

International networks continue to generate enormous economic value. But their strategic importance is now more explicit: the ability to access, monitor, interrupt or reroute critical flows can shape the choices available to states and businesses. Energy corridors, financial systems, supply chains and intelligence infrastructure are not merely channels through which power operates. In some circumstances, they are sources of power in their own right.

The October developments around Hormuz, Russian energy diplomacy and reported satellite activity demonstrate different aspects of this wider shift. They should not be collapsed into a single narrative of coordination. They reveal instead that physical infrastructure, economic dependence and information access can each create leverage in a contested international environment.

The central judgement is that the long-term contest will be fought not only over who controls critical networks, but over who can reduce dependence on them without sacrificing the benefits they provide.

States that can impose costs may gain immediate bargaining advantages. States that can adapt may preserve greater freedom of action over time. Neither position guarantees success: coercion may fail to change an adversary's behaviour, while diversification can prove expensive, incomplete or strategically ineffective.

The next phase of geopolitical competition will therefore depend on a dual capacity: the ability to exploit existing dependencies and the ability to build credible alternatives.

Interdependence remains a source of prosperity. Its future strategic value will depend increasingly on whether countries can preserve the benefits of connection while limiting the risks of coercion.

Sources and References

1. Farrell, Henry, and Abraham L. Newman. “Weaponized Interdependence: How Global Economic Networks Shape State Coercion.” *International Security*, Summer 2019. Read the research summary

2. Reuters. “Ship attacks in Strait of Hormuz hit record high in October.” 23 October 2026. Read the report

3. Reuters. “Russian oil refineries boost output as drone attacks halt after US-brokered deal, sources say.” 27 October 2026. Read the report

4. Associated Press. “Ukraine and Russia eye new peace talks — and Melania Trump’s mission — but steep obstacles remain.” 25 October 2026. Read the report

5. Associated Press. “Russian satellites help Iran’s allies strike Saudi Arabia, data and officials say.” 27 October 2026. Read the investigation

6. Rajan, Ramkishen. “Weaponised Connectivity: How Geo-economic Pressure Operates Below the Radar.” *Survival*, published online 24 July 2026. Read the research abstract

7. “Eroding economic leverage: choke points, infrastructure and intermediary economies in US–China competition.” *International Affairs*, Oxford University Press, 2026. Read the research abstract