No. Blue is leeward boat and rule 11 allows her to luff only if no other rule conflicts - the requirements of rule 18 do here. Rule 18 begins to apply when the boats are about to round, and this is always the case when one of the two boats has reached the two-length zone and it is often earlier (see also case 84). As of this moment, rule 18.2(a) applies and Blue must give the inside boat (Red) room to pass the mark on the required side and Blue is not allowed to sail with Red on the wrong side.