Resource Nationalism Is About Chokepoints, Not BRICS Versus the West

Most coverage of resource nationalism frames it as a contest of blocs: BRICS on one side, the West on the other. That framing misses the asymmetry that matters most. A missing refinery, port or chip fabrication plant can stop production outright, while financial power can only raise the price of getting supply somewhere else.

The Strait of Hormuz shows the difference in practice. Shipping through the waterway has been severely disrupted since 28 February 2026, roughly 230 days as of today, and Brent pushed above $100 a barrel earlier this month.

For anyone with exposure to mining, energy or technology, this changes how risk should be read. Governments now treat mines, refineries, ports, data infrastructure and advanced chip capacity as strategic assets, not ordinary commercial inputs.

The useful question is no longer which bloc wins. It is where supply security is real and where it is simply assumed, and this analysis gives you a framework for telling the two apart.

Why is the world splitting into physical suppliers and financial powers?

The popular version of this story comes from analysts such as Simon Nisho, who argued on Mining Network that commodities are becoming nationalised and contested between power blocs. In his framing, BRICS controls the physical chain while the West holds the money. The two sides hold very different kinds of leverage:

• Physical leverage: mines, smelters, refiners, shipping ports, power stations and rail
• Financial and technological leverage: capital markets, insurance, shipping finance, military strength, advanced equipment and, by Nisho’s estimate, about 80% of data centres

Independent research supports the substance of that split, but not its absolutes. Neither the claim of total BRICS physical control nor the 80% data centre figure could be independently verified.

What resource nationalism actually looks like

Resource nationalism is when a government uses its control over natural resources to capture more value or bargaining power. The tools include export controls, state ownership, local-content rules (requirements that a share of work or materials be sourced domestically) and bloc partnerships.

The trend is broad. The Atlantic Council’s Resource Nationalism Index, published in July 2025, placed 41 countries, representing 41% of global mineral output, in its two highest-risk categories.

Indonesia offers the clearest worked example. From 2020, it restricted raw nickel ore exports to force refining onshore, and Chinese partners built much of the resulting processing capacity. Indonesia captured downstream value, but at the cost of deeper reliance on foreign capital, technology and customers.

Mineral processing, covering beneficiation, flotation and recovery, determines how much of an ore body’s value is captured, which is why host countries pushing refining onshore treat it as the prize.

“China is winning the race for critical minerals long before mines enter production.” Center for Strategic and International Studies (CSIS)

Why the bloc binary is overstated

BRICS is not a unified supply bloc. China, India, the UAE, Indonesia, Brazil and Russia run different industrial policies and security relationships, and Nisho himself calls India the “dark horse.” Trade continues across bloc lines regardless of the rhetoric.

Western diversification into mines, refineries and battery plants is real, and recycling and battery chemistry shifts can reduce vulnerability over time. Yet concentration is rising, not falling: the International Energy Agency (IEA) found the top three refining countries’ average share climbed from about 82% in 2020 to 86% in 2024.

What this tells you is that “who owns the deposit” is the wrong question. Leverage sits in processing, so your exposure to any bloc is rarely as clean as a headline implies.

What has the Strait of Hormuz disruption shown about chokepoints?

If leverage sits in the midstream, chokepoints are where it becomes visible. Hormuz has become a live stress test. It is not a legally complete closure; some vessels still transit, and Nisho’s figure of roughly 200 days of blockage is an approximation.

Before the war, the strait carried about 20% of global oil and fuel shipments and about one-fifth of LNG trade, according to Reuters and the US Energy Information Administration (EIA). The figures below, mostly unverified, are attributed to their named sources.

Alternative routes absorbed a meaningful share of the shock. They did not replace it.

The freight figure is the revealing one. Western insurance and shipping finance can keep tankers moving, but only by pricing risk into every barrel. On LNG, the US EIA reports a sharply wider spread between US Henry Hub prices and European and Asian import prices, so buyers without domestic gas carry the cost.

For you, the price spike is only the visible symptom. The real exposure is delivered cost, insurance availability and route access, which can make a low-cost source uneconomic even when the resource itself is untouched.

Hormuz shipping insurance costs show how financial power works in practice: war-risk cover keeps tankers moving, but the premium is passed on through delivered prices rather than removing the physical constraint.

What the Russian gas precedent adds

Europe’s experience after Russia cut pipeline gas in 2022 points the same way. Diversification came faster through demand reduction, storage filling and LNG imports than through new domestic production. Chokepoints reward whoever already holds pipelines, alternate ports, stocks and demand flexibility.

Where does control really sit: processing, magnets, batteries and chips?

Hormuz is a physical chokepoint on a map. The midstream chokepoints are harder to see, and more concentrated. According to the IEA’s outlook released on 11 September 2026, China leads refining in 19 of 20 strategic minerals, with an average share of roughly 70%.

Processing shares vary by stage, so each figure below should be read against its definition.

No consolidated solar manufacturing share was found, although China’s dominance runs across polysilicon, wafers, cells and modules. The IEA argues export controls have turned this concentration into observable geopolitical risk. The sequence of controls shows how:

1. Gallium and germanium, July 2023
2. Graphite, October 2023
3. Antimony, August 2024
4. Seven rare earths, April 2025
5. Battery materials and manufacturing equipment, October 2025

Each step targeted a stage where alternatives are scarce. Funding a new mine does not secure supply unless a qualified refinery, separator or magnet plant will accept the ore.

China’s rare earth export controls illustrate how a single licensing regime can convert processing dominance into leverage over magnet makers, defence suppliers and automakers far from the point of extraction.

Taiwan and the leading edge of chips

The same logic applies to semiconductors in a different form. A Taiwan government report citing the Industrial Technology Research Institute (ITRI) estimated in December 2025 that TSMC held 69% of global 3nm capacity, 53% of 2nm and 85% of 4-6nm. TSMC’s overall foundry share reached 70.2% in Q2 2025.

These figures describe the leading edge, not every chip made. Steve Sangelo of the SRS Rocco report compares semiconductors to charcoal before the Bronze Age collapse, a framing device rather than a forecast.

The 2020-2022 chip shortage, which halted some American car production, showed why concentration bites. Low inventories and long qualification cycles turned a temporary shock into a persistent one, which means deposit size alone tells you little without processing and offtake access.

How thin are the buffers, and what does that mean for investors?

Concentration only becomes dangerous when there is nothing in reserve. Australia makes the point concretely. At the end of 2025, it held about 38 days of gasoline, 32 days of diesel and 29 days of jet fuel, according to Nine.

Those are days of domestic consumption. The IEA obligation is measured differently: members must hold at least 90 days of net imports, and Australia has sat below that level for more than a decade.

Nisho argues supply chains once carried buffers of roughly 6-8 months. The research points to several reasons cushions have thinned:

1. Just-in-time logistics cut working capital but spread disruptions quickly
2. Storage, insurance and financing make holding stock expensive
3. Raw ore stockpiles cannot substitute for refined material when processing is concentrated
4. Mines, refineries and pipelines take years to build
5. Volatile prices and permitting delays discourage spare capacity
6. Fabs, battery plants and aircraft fleets cannot quickly switch inputs

The result is a market that cannot respond quickly in the short run. Over longer periods, high prices do induce substitution and new supply, just not fast enough to prevent damage during a blockade or export ban.

Structural pressure versus cyclical relief

The lasting pressures are rising refining concentration, expanding export controls and demand growth from electricity, batteries and AI infrastructure. The potential relief is equally real: new projects in Australia, North America, Africa and Southeast Asia, battery chemistry substitution, recycling and Chinese overcapacity creating surpluses.

Nisho also predicts stress will first appear in cyberspace and that AI and central bank digital currency developments will follow. These are one analyst’s forecasts without independent corroboration.

Scarcity today can become oversupply tomorrow. The question for you is not whether supply is tight, but which part of the chain is both constrained and defensible.

Past performance does not guarantee future results. Forecasts cited here are speculative and subject to change based on market developments.

Reading supply security as a chain, not a headline

Leverage is split. China and producer states hold physical processing chokepoints, while the US and its partners hold financial and technological power, and the two are not interchangeable. Hormuz has shown that buffers and routes count for more than rhetoric.

Before you take a position in any resource name, test it against the whole chain: ore, processing, power, transport, offtake, technology and jurisdiction. A gap at any link can matter more than the size of the deposit.

The signals worth watching are the next Chinese export control announcement, Hormuz transit counts, and the IEA’s inventory and refining data.

This article is for informational purposes only and should not be considered financial advice. Investors should conduct their own research and consult with financial professionals before making investment decisions.