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Bloomberg: Goldman Says Gulf Oil Flows Two-Thirds of Prewar Level
A lot of ships are still making the crossing dark with transponders turned off but the trend is clear. Iran’s (supposed) leverage over the strait is basically nullified, oil is passing through despite Iranian proclamations. Independent analysts now agree with what the US government was saying weeks ago, that millions of barrels are passing through the strait under American auspices.
US CENTCOM agrees, putting out this statement that the US has escorted a few thousand ships through the Gulf, carrying through three-quarters of a billion barrels of oil over the past few months.
What changed?
Axios: "That sucker is open": U.S. gains the upper hand in the battle for Hormuz
The US has apparently de-mined the Straits of Hormuz, although, interestingly, there don’t seem to have been many mines in the first place!
It seems as though Iran’s capacities to threaten ship traffic the Strait were severely degraded by US military action, but that Iran was successfully able to convince news reporters and insurance companies that it could target ships.
For instance, Brady Sullivan at CNBC says
Meanwhile, Reuters: Pipelines and ports: Iran war spurs Gulf infrastructure investment
Not only has Iran lost control over the Straits, but Gulf states are building new pipelines to reroute oil around the Straits so that Iran can never threaten them again.
And how does it look inside Iran?
WSJ: Labor Protests and Panic Buying Signal Growing Pressure in Iran
————
Some might remember Trump’s infamous comments on this subject some months ago:
The Shakes take: Iran will never toll the straits, Iran will never have nuclear weapons, Trump was right about everything, a lot of people who believed Iranian claims are looking very, increasingly, increasingly!, foolish.
Cool story bro. I hate that you keep putting me on the same side as [
the likes ofETA: self-edit, this was too antagonistic] @hanikrummihundursvin and @coffee_enjoyer (I don't buy the "We did this at the behest of our Zionist masters" narrative), but it looks to me like the situation is materially worse for the US than before the war started, and the fact that it's much worse for Iran does nothing for me. I will ask you again: what is the benefit to me, as an American taxpayer? In what way is America now richer and safer? "We won we won we won!" okay, cool, what did we win?This is not an impressive question to me. The American military undergirds a global economic system that contributes to Americans being fabulously wealthy. War makes us rich.
It’s a little like asking me, how does bench pressing help me lose weight? How does studying math help me go to college? I’m not sure what you even mean by that. Do you want a defense of the underlying principle or the specific action? Bench press is a good exercise for growing muscle which helps you lose weight. Math trains you how to think in abstract terms even if you will study art. War with Iran strengthens the American global system that makes us wealthy even if it seems like it costs a lot of money.
Nevertheless here are some of the benefits of war with Iran:
America exerts greater control over the oil-producing region of the world. This control eventually produces price stability (America can’t get bent over by OPEC)
America destroys its major opponent for projecting power in the Gulf, which strengthens the American military’s position as the basis of global order and therefore your personal finances
America destroys a state sponsor of terror that would kill Americans and other allies throughout one part of the earth
America stops the proliferation of nuclear weapons to another country hostile to America (which would undermine the global security on which our tremendous wealth is based)
American allies in the Gulf are drawn more tightly to American will which allows us to advance a host of interests (finance, business deals, supply chain logistics, etc.)
Basically, war with Iran is good because it makes America more powerful and American power is the basis of the global system. We do not actually have as much as we now have if the world is so insecure that any medium-sized power can push around its neighbors and America retreats. Fortress America does not have the same wealth and security if the Gulf wants theocracy, Europe wants autarky, pirates can roam free between Constantinople and Gibraltar, terrorists can kidnap Americans or even Saudis, etc etc.
I think this is all more or less understood.
The problem has long been was that War with Iran was assumed to be more expensive than it would be worth. And Trump went against that calculation and launched a war anyways. Currently, it seems like Trump was right: oil prices have not risen significantly, Iran has been unable to retaliate, and America is acquiring control over a major global choke point.
It would also allow for an eventual drawdown of American forces in the region, similar to how America doesn't really feel a need to keep significant forces on standby in the Med or Caribbean
This would require regime change to something non-hostile to the US, which doesn't look like it's in the cards. If the Iranian regime folds without collapsing, the US will still need to keep significant presence in the area.
I don't think this is strictly speaking true. The US didn't need regime change in Cuba for the Caribbean to become an area of much less concern to it, for instance: sufficiently degraded capabilities suffice.
I do think this (or at least the specific example of Cuba) suggests that long-term sanctions that stick against Iran would probably be necessary in the alternative to keeping a major force presence, and I'm not sure if Iran could be as easily sanctioned as Cuba.
Cuba is a small island nation with no real industry. Iran is a real country with its own industrial base.
Fair enough distinction, although it sounds like things are already pretty bad over there after just a short blockade.
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