One of the main concerns of the financial markets is how this will affect the price of oil. The price is up, but there does not seem to be a major panic. The article headline says the price “soared” but it’s up only about 7 1/2%.
Finishing off the Iranian nuclear program
“We have completed our very successful attack on the three Nuclear sites in Iran, including Fordow, Natanz, and Esfahan,” Trump said in a post on social media. “All planes are now outside of Iran air space. A full payload of BOMBS was dropped on the primary site, Fordow. All planes are safely on their way home.”
Trumps speech -
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Pakistan website. Could be big news if true.
Yeah it’s legit, but I think there’s still a second Iranian government body that needs to approve it.
But as I told a friend, the threat to close the Strait is a great deterrent to offensive action against Iran, given the prospect of disrupting 20% of oil and gas trade and likely sparking a global recession if prolonged. However if they actually have to do it, they’ve already lost and now major US intervention would likely end the regime. Nevermind that the primary beneficiaries and buyers of the cheap oil and gas from there are their nominal allies like China who would not be happy with the costs and supply disruptions.
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You can bet on (more) war with Iran, and someone placed a big bet for today.
Sure the 2/9 contract pays 40:1, but good leverage if you know something.
Iran attacked by US and Israel in surgical strikes on the leadership, killing many including the big guy. Not much love lost after he murdered 30k+ of his civilians who were protesting.
What comes next is less clear.
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Iran war shows advances in Military tech
There are reports that Israel uses their iron beam laser canon to shoot down a Hezzbolah rocket
Also see this about a United States company building low cost drones based on Iranian design
“For the price of a single Tomahawk, you can launch 57 LUCAS drones,” analyst Shanaka Anslem Perera posted over the weekend. What’s even more remarkable is the cost savings — even over the Russian model. "A Shahed-136 in Russian production costs approximately $80,000 per unit at the Alabuga facility. The American reverse-engineered version costs less than half the Russian licensed copy of the Iranian original.
“SpektreWorks received a $30 million initial production contract. That buys 857 kamikaze drones for what the Navy spends maintaining a handful of Tomahawks.”
Lack of insurance was causing the oil shortage, not attacks by Iran. President Trump stepped in and got the oil flowing again.
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Yesterday, I explained how seven insurance firms in London shut down one-fifth of the world’s oil supply.
Today, Trump may have just made the most aggressive sovereign insurance play in modern history.
Here’s what happened and why it matters:
Trump ordered the U.S. Development Finance Corporation to immediately offer political risk insurance and guarantees to all maritime trade through the Gulf. Especially energy. Backed by Navy escorts if needed.
Read that through the lens of what I described yesterday.
The Strait didn’t close because of missiles. It closed because the insurance market collapsed. P&I clubs pulled coverage, reinsurers withdrew, and the entire commercial shipping architecture froze.
This move doesn’t address the military problem. It addresses the actuarial one.The DFC is stepping into the void that Lloyd’s and the London reinsurance market created when they pulled out. The U.S. government is effectively saying: we will underwrite what the private market won’t.
