You know, I got ten minutes before my meeting and all these answers are pretty poor so I’ll give you a rundown.
About 20% of the world’s crude oil pre war flowed out of the gulf using tankers through the strait of Hormuz (SoH). Crude is not all created equal. Refineries have to be built to process different types of petroleum products and different grades. I’m not a chemist but a few examples are Venezuelan and Cuban crude. These have different particulates in them that make them much more expensive to process. The crude oil out of gulf states has “sweet crude” which refineries, particularly in the US are tuned to process. There are other petrochemicals produced and shipped out of the gulf as well. For example, Qatar produces something like 20% of the world’s natural gas and quite a lot of fertilizer byproducts come from this process as well.
It’s really quite complicated but simply: these extraction processes cannot be stopped and started on a dime. The refineries and plants take weeks to start. Furthermore, pipelines and alternative shipping routes are not exactly viable. Pipelines take decades to build and are vulnerable to missiles. They also need constant flow to function properly. Shipping through the red sea goes through the suez which has size limitations. Going around Africa also risks attack from Ansrah Allah and Yemen.
Ok. So what? 20% isn’t the end of the world, right? Prices go up 20% everyone suffers and blames Iran and they become a pariah, right?
No, not really. From my lay understanding of these refinements and logistics. First, energy is an inelastic good. There aren’t many consumers who will exit the market for energy even if the price skyrockets. A hospital cannot simply say “oh we won’t power our nicu incubators until prices come down”. And second, the petroleum products are substitutes in the refinement process. You can have diesel or you can have f22 fuel from that barrel of crude but not both. So the pain is felt at the bottom of the market–you’ve got to go to work and filling up your car is non negotiable but at a certain point it won’t make financial sense to do so. The US government is going to fuel those jets no matter the cost, though.
Energy and fertilizer are inputs into the global economy. There already wasn’t slack in the pipeline, so to speak. The repercussions are yet to be seen. The US has been dramatically drawing down it’s strategic oil reserves to keep refinement going but speculation is that the reserves will not hold out at the current rate of consumption over the next few months.
That being said, the affect on regular people on the ground in Iran? I mean. They’re getting bombed by the US. An existential global economic threat is being used to stop that bombing. So. Probably better for them.
the US is needlessly continuing thier war of agression, as a strategy to distract from the epstein files it still is, and for trump to manipulate the markets. So if you notice everytime something new from the files come on the news, he will try to escalate it. also they dint expect iran to fight back so hard, unlike venuezeula.
IDK if there’s a point.
The Trump admin is going wild with imperialism. They did a coup in Venezuela. It went surprisingly well. Negotiations with Iran weren’t going well (over the nuclear stuff), so Trump decide to try that coup thing again. Killed the leader of Iran. With no actual plan for how that was going to go afterward. Now the dead leader’s son is in charge. He’s pissed at the USA. The main/only leverage Iran has is on the Strait of Hormuz. So now that the USA killed their leader, they’re using that leverage. Which is driving up the price of oil and hurting everyone, including the USA.
If the Iranians didn’t have control of the strait anymore, that would probably mean that the regime has fallen.
Do you think they’re going to try for Greenland next? I feel like Trump might just attempt to pivot there if he can’t take Iran
You’re giving them way too much credit here. Trump didn’t “do a coup” in Venezuela. They abducted one guy. It’s the same regime. They didn’t even intend to bring another group into power. Basically the same thing in Iran except they hoped (stupidly) that the regime would fall.
‘They’re going wild with incompetent, lazy, ineffectual imperialism’ is more accurate.
Not stated above. Iran has spent the time between 1979 and 2026 building social, military, and political infrastructure to ensure that a decapitation strike, like the one carried out on 28 February, would not destabilize the country or even upset the leadership system of the state. If anything, US didn’t account for the galvanizing force of being attacked.
Iran has exercised leverage for decades. Funding.and arming Hamas and Hezbollah to wage proxy war against US ally Israel and forestall the ambition of regional nemesis Saudi Arabia. Iran held off US-backed Iraq in war, at great cost, for 8 long years. Iran sells their oil to their allies, defends their territory effectively, and suppresses popular uprisings within. Iran may not be a global power, but it is certainly a regional one.
Control of the Strait does not make for a happy global community. Controlling the Strait is expensive. Better to wield the threat of its closure and extract concessions or support from other nations. Its cheaper, more neighbourly, and keeps up appearances. “Exercising” leverage by closing the Strait, from either side and for however long, just makes things worse for everyone. Speak softly and carry a big stick. Not, “lookit my big stick! I’ll hit you!”
What Iran seeks to gain with control of the Strait is recognition of their regional power, an end to hostilities, and a return to a status quo that existed before the Red Hats had their day. It has cost them dearly. However, within living memory, war against Saddam Hussein cost between 200K and 500K lives.
Control of the Strait turns the world against the Red Hats. Hopefully, it turns Americans as well.
they also have china and russia backing them, as its useful for those 2 powers as well.
Homuz is an inflation dial for the planet. Squeeze the channel and inflation goes up. Right now it doesn’t seem so bad, because China decided to flex their own oil reserves. That’s the reason the US doesn’t have $5-$6 a gallon gas right now. Until shipping is moving in Hormuz again, China still has the option to make that happen. And they might, depending on how dipshit Donny talks about them.
The only difference between Iran or the US controlling Hormuz, for the average Joe is what crazy bastard gets to hold the inflation dial.
Also there’s a very long delay on some of the affects. Food prices are going to get real sketchy around the world this winter and going into next year.
A lot of oil flows through the strait from the oil fields behind it. Iran can use the oil without it because they’re behind it. By limiting access to the strait, they can harm the global economy, at least as long as, one, they control the strait, and two, the global economy depends on oil. The Americans are doubling down on their reliance on oil, probably to justify fighting Iran for the strait. So they challenge Iran’s control of the strait. The other option is to make a rival strait, or canal (e.g. Panama Canal), on land the US or an ally controls. That’s expensive though, and will take time, and the US/the west doesn’t really have friends over there, just unsteady allies.
So right now the issue is Iran keeps flip-flopping on letting ships travel through the strait, but I don’t imagine the US would be a better steward of it. The better option by far would be to get the west on renewable energy. If the US/the west didn’t need oil, the Middle East/OPEC would lose a LOT of influence over the global economy. The US may be doubling down on oil to appease their allies in Saudi Arabia.
appease their allies in Saudi Arabia.
Former allies who now tolerate the US but very intentionally also make alliances with China and Russia.
Kinda like Canada.
Nice job, Donnie
The Saudis must (out of strategic necessity) always align with whoever is the greatest air power and ability to forward deploy. It won’t be China any time soon. Saudi Arabia is very vulnerable to air power that can forward deploy.
Off topic. Will this speed up electrification? I know I’m now looking at replacing my ice vehicle.
Gas prices. Nazis, etc
Let’s call it a carbon tax.
Well sourced and detailed look at the history and geopolitics of the Strait of Hormuz.
The global ecomy still depend on oil, iran can’t not beat the usa militarly so rhey hsve to rely on attscking the global ecomy. Iran controlling the straight means the usa can’t wage a long war and prevent the collpase of iran as a functional state
Lol wut. Controlling supply lines is literally a militant strategy.
Yes, Iran can defeat the US militarily in the mode east. Just like how the Vietnamese defeated the US in Asia.
One of the biggest threats to most species on earth is the climate catastrophe.
This straight is a major shipping route for oil.
It doesn’t matter who controls it, but it’s best if it’s closed. Or the fees to cross it are ad high as possible.
We can’t afford the cost of allowing oil to be sold.
There is plenty of other goods being transported through the straight, not just oil. And if it were being closed permanently, oil tankers would just have to take the longer route and pollute even more
What longer route? It’s the only entrance to the gulf as in “Gulf States”
they would have to go through egypt, longer route, or worst africa, or SE asia.
That’s the straight of oman. Different straight
The world depends on oil for everything. A lot is transportation (40% I believe) but the rest is petrochemicals.
Nearly all of that flows through SoH. There are pockets elsewhere but it’s not really significant in the grand scheme of things.
Ironically, oil-producing countries don’t really refine their own oil.
Oil transportation instability leads to countries “securing” their own oil. By any means necessary.
The only country that could possibly do without access to the SoH is the US, but it will take time to set up distribution.
Once countries start securing their own oil (piracy), other trade routes fall apart unless some country with a big-ass navy ensures piracy doesn’t occur. The US is the only country with a big enough navy to do so.
US was there to ensure all ships may pass without being shot at or charged a toll.
Iran is there to shoot at ships and charge a toll.
Thanks Donnie
There was no shooting at ships or tolls until king dipshit and his israeli friends started bombing schools
So many schools
