The Iranian military added that until the US “restores the complete freedom of navigation for vessels from an Iranian origin to a destination, and from a destination back to Iran, the situation in the Strait of Hormuz will remain strictly controlled and in its previous state”.
The British military announced on Saturday that a tanker transiting the Strait of Hormuz had come under fire from two gunboats operated by Iran’s Revolutionary Guard. The incident occurred after Tehran announced earlier in the day that it would reimpose restrictions on ships passing through the Strait of Hormuz, as the U.S. blockade of the vital maritime trade route continued.
Iran’s joint military command said on Saturday that “control of the Strait of Hormuz has returned to its previous state … under strict management and control of the armed forces.” It warned that it would continue to block transit through the strait as long as the U.S. blockade of Iranian ports remained in effect.
TankerTrackers.com reported vessels were forced to turn around in the strait, including an Indian-flagged super tanker, after they were fired on by Iran.
What really interests me is NOT the war, or the politics. What interests me are the responses by industry and consumers.
The questions I would like to see answered are:
How are the oil producers in Africa, South America, Canada and the USA reacting. Are they reworking oil fields? Raising money for investment? Or are they sitting on their hands waiting for
outcomes?
How are the solar and batteries producers reacting? Are they increasing investment? Running double shifts etc.
How are EV manufacturers responding? Are they opening new show rooms,? Opening up new manufacturing capacity?
How are consumers reacting. Are they shutting down discretionary travel? Are businesses shutting in travel? Has anyone changed or accelerated oil conservation plans?
What I am trying to tease out is NOT what the next quarter is going to look like, rather are we going to see fundamental changes in consumption and production of energy?
I am thinking back to the time I was at the helm of a 600 freighter. The autopilot was out and I got a short shift way out in the ocean holding a course. We had a 20 to 30 foot quartering sea. We would drift off course and so I would have to put the helm over to correct. The pressure I applied did nothing for a few seconds maybe a half a minute. Then the ship would start to swing. It took time, but even though you only had a few degrees of rudder in, the ship would not only turn, it would accelerate the rate of turn. The quartering swell didn’t make things smoother.
It seems that the Straight has imposed a pressure on the economy, but now there doesn’t seem to be a compass reading telling me how its changing.
My Wyoming “working interest” bunch just voted a BIG assessment to combine a bunch of little old slow pumps into one much more expensive deeper well capable of lots of slantwise expansions, costing big up front money…
I am going to surmise that somebody looked at current operating costs plus posible ROI and made the decision to invest.
I the phone company depending on the work, we looked for an 18 month, 36 month and 60 month ROI. In the oil field a lot of the small accessory companies looked for 6 to 10 months. In other words if they were going to buy and lease a forklift, they wanted the entire thing paid for in 10 months.
Knowing what the ROI that the oil company is using might give an idea of how long they can project elevated oil prices.
Iran’s economy could collapse within three months under naval blockade, experts warn
As usual, and as expected, almost no thought given to what would happen to the US - or world - economy if the Strait continues to be closed for three months. The market rallied because of the (premature) declarations of victory (actually all 14 of them) but if this drags on for three months, any such further manipulations will be seen for what they are - except for the True Believers®, of course.
I do credit Jerusalem Post for at least balancing some of the obvious propaganda with a few glimpses of reality:
Until last month, the United States maintained several vessels in the Persian Gulf and the Gulf of Oman, including the USS Canberra, USS Tulsa, and USS Santa Barbara, which were part of the Fifth Fleet and were officially tasked with mine countermeasures and ensuring maritime security in the region and the Strait of Hormuz.
However, it appears that these vessels have since withdrawn from the area to avoid potential attacks by the Islamic Republic.
And there’s this:
Given the foreseeable escalation of tensions in the Strait of Hormuz, and as the Islamic regime claims control over the passage and even the authority to impose tolls on vessels, Israel appears to be preparing for a possible resumption of military strikes against Iranian targets.
In such a scenario, the IRGC - which has effectively taken full control of the government - may fight to preserve what remains of its power, or, as some analysts suggest, attempt to expand a “scorched-earth doctrine” not only within Iran but across the region.
However, the IRGC - now dominating the political landscape following the removal of Ali Khamenei and the designation of [Mojtaba Khamenei] as the nominal leader - continues to maintain control within the country, sidelining clerical and conventional state structures.
So much for the “IRCG is on its last legs”. The hard-line regime has been replaced with an even harder-line regime. So, heck-uva-job, Brownie.
Meanwhile, the Islamic Revolutionary Guard Corps (IRGC) has continued to obstruct passage through the Strait of Hormuz and has reportedly even threatened US military vessels in the area.
At the same time, as the blockade is enforced and President Trump has warned that any Iranian fast-attack boats approaching the area will be destroyed, the IRGC’s warning to US military vessels seeking to enter the Strait of Hormuz could at any moment ignite another war, despite the two-week ceasefire.
So. The IRGC, which is defeated, and the Iranian Navy, which doesn’t exist, are continuing to stop shipments through the Strait - and realistically can do so for as long as they like with a variety of cheap tactics including fast boats, drones, and missiles.
To misappropriate a line from a movie: “We’re gonna need a bigger strategy.”
But not sure this is Macro Economic. While politics and political bedfellows can be unforeseen, we can model how the world ends up working with a closed Straight.
The political end could be very interesting, think Turkey becoming the Ottoman Empire and infrastructure being built overland between the Middle East and Europe. But this is like trying to image what a person will look like from looking at a zygote.
A more clear picture will be looking at oil capacity, EV manufacturing capacity and energy saving plans. These will determine how the entire world economy turns in the next 24 months.
For example, over half of heavy trucks sold in China in December, before the war started, were electric. Last year, before the war started, in a few weeks, don’t remember if it was a month or 3, China at a Germanys worth of solar plus storage.
As this is kinda playing out like I thought, I am becoming more confident that the oil based economy over the last 100 years is drawing to a close. This will dramatically change how money flows around the world. And THAT will be disruptive.
As my dentist says, “You will feel some pressure here”
Not to pick an unnecessary nit, but that is actually possible, at least to some degree.
Yes, you can predict certain aspects of a person’s looks from their DNA, but creating an exact, photographic portrait is not possible. Scientists can accurately predict pigmentation (hair, eye, skin color) and some ancestral traits, but reconstructing specific facial features (e.g., exact nose shape, chin, or overall facial structure) from DNA alone is highly complex and currently in its infancy
I watch “true crime” shows, and in a couple they have been quite successful in predicting a person’s looks - to the point of producing sketches for media consumption - from just trace DNA.
Of course it’s possible they have only focused on their real successes where they used some markers as are known (skin color, hair, etc.) and guessed correctly at others, but in the ones I have seen the resemblance between the “guess” and “reality’ has been remarkable, to the point of actually identifying suspects who later turned out to have been the perps.
Where Ireland supports the Palestinians, the Greeks generally support Israel. Given time and cost to the global economy things will shift.
Hezbollah has killed more Lebanese than Israelis. Heros? That an observable guess. Hezbollah has only offered Lebanon political violence.
Hamas and blame?
I can not fully speak for individuals but groups of people in very little time can shift positions.
Some Americans believe kill one terrorist and that will cause another to rise. That is a theory not always a fact. The premise a political solution is needed is true, and can happen later.
The BBC has found a pattern of spikes in trades on financial markets just hours, or sometimes minutes, before a social media post or media interview by the US president was made public.
Iran is reportedly moving to expand crude storage at Kharg Island by reactivating the 30-year-old very large crude carrier M/T Nasha, a sign that the country’s main oil hub is nearing its onshore storage limit amid the US blockade of Iranian ports.
Maritime analysts say the vessel, which had been anchored empty for years, is being repositioned as floating storage to absorb crude that still has to move out of the system…
Analysts estimate roughly 13 million barrels of spare onshore storage remain at the terminal, while net inflows are running at about 1.0 million to 1.1 million barrels per day. At that pace, storage could be filled in about 12 to 13 days, which places the saturation point in late April if current flows hold.
"They came to us and they said, ‘We will agree to open the strait.’ And all my people were happy, except me. I said, ‘Wait a minute, if we open the strait, that means they’re gonna make $500 million a day.’ I don’t want them to make $500
intercst succinctly stated a fact on a closed thread that I totally agree with the substance:
We’re not allowed to mention the country that started this war with the surprise attack on Feb 28th. We really need to reexamine our military spending and where it’s going.
By year-end we’ll be in a global depression and many countries around the World will be in famine – and American taxpayers will be blamed for all of it because they funded it.
What keeps them from simply dumping the excess into the ocean or burning it? They might prefer that solution to the alternative (turning off the refinery) due to the risk of never being able to turn it on again without substantial repairs.
