"$200 a barrel is not outside the realms of possibility in 2026”

Lots of people have asked if this is America's Suez moment - a successful military operation that demonstrates, because of economics, that American hegemony is over, like the US response to the Suez adventure in 1956 showed the British and French were paper tigers. Ambrose Evans-Pritchard presents the analogy today in the Telegraph. 

He is a Cassandra but Cassandra was right and he is sometimes right. He was right to predict the Russian attack on Ukraine before most people. I was convinced it would not happen.

This does look like the moment the American or the US-Israeli empire is defeated and it is punishment for Netanyahu's hubris, but the USA has been defeated before, in Vietnam, Iraq, Afghanistan and by the hardy Houthis in the Red Sea. 

Trump's election prevented Hillary and the deep state from overthrowing Assad and replacing him with 'moderate rebels' - that might have been another defeat for America (and for Syrians but the US deep state does not care about Syrians).

I hope some politicians in Europe campaign for independence from America.

From Ambrose Evans-Pritchard's article:

'“In our view, $200 is not outside the realms of possibility in 2026,” said Simon Flowers, the chairman of energy consultants Wood Mackenzie.

That would be a horror story for gas too. Société Générale said funds are betting on a strike price of €200 (£173) per megawatt-hour for September natural gas futures in Europe. The same contract was €26 a few weeks ago.
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Trump has talked of a $20bn (£15bn) fund backed by the US Development Finance Corporation to cover war reinsurance for Gulf shipping. This reveals how little the White House understands the global maritime and insurance market.

Helima Croft, a former CIA analyst now at RBC Capital, said the task of shifting the vast fleet of stranded ships on both sides of Hormuz threatens to overwhelm the “entire $205bn statutory risk limit” of the US government agency.

She said Iran still has an arsenal of long-distance drones that can be deployed from anywhere and “an ample supply of small, fast boats that can be packed with explosives to target ships”.

The new and dangerous twist is that China has sent its state-of-the-art Liaowang-1 signals intelligence vessel to the region with an escort of destroyers.

Defence Security Asia said its electromagnetic sensors could give the Iranians instant data on US and Israeli aircraft, quoting one specialist calling it a “floating supercomputer processing petabytes of data to map the invisible battlefield”.

The Kuwait Petroleum Corporation said maritime insurance on its own is not enough. Shaikh Nawaf Al Sabah, the chief executive, vowed that he will not risk the lives of crews.

“We’re prepared to move through the Gulf if we can get some level of assurance on safe passage from the US navy but there’s not yet a plan in place for a naval escort,” he said.

“There has been oil traffic through the Strait of Hormuz for over 80 years and not a single day of those 80 years has it ever been closed to traffic. After eight decades, we have now entered a new era of geopolitics,” he said.

Well, indeed.

Trump posted on Truth Social that the naval escort would soon be assembled. It has not been done and cannot physically be done in time to avert a global energy crisis as long as the war continues.

The US has just 12 warships in the Gulf region. They are needed to prosecute the attacks. It would take a fleet of 20 ships to handle the constant stream of tankers. The mission would need minesweepers from Europe.



Without seeming to realise what he has done, Trump has exposed the raw fact that the US is no longer a full-spectrum military hegemon able to project power simultaneously in multiple theatres across the planet. It has superb armed forces and technology – but that is not the same thing.




...Markets expect Trump to declare victory soon, before he is overwhelmed by a supply-chain shock to match Covid.

That bet is probably correct but Iran’s Revolutionary Guards have so far refused to make it easy for him by rolling over.

“It is we who will determine the end of the war,” they said on Tuesday.

So which will prevail in the tug of war within Trump’s personality: his fear of losing the US mid-term election? Or his injured vanity and his psychological need to command “escalation dominance”, always and everywhere? That is the $200 question.'