Iran Super Thread- Merged

[Altair]

This part makes the rest of your post irrelevant...

Iran has one trick, and it's not actually that great of a trick. They can sink some ships, some of the time. Eventually, economics makes ships and sailors disposable enough to start to ignore their trick.

We aren't there yet, bet let's not pretend Iran can keep playing it's game forever. China will never hit a number of dead Indian or Philippino sailors high enough to make them care about the human cost of defying Iran. They will pump money in to solve their problem, and there will always be someone desperate enough to risk it.

I agree, some riverboat gambler will take the risk.

But the SoH was handling 100+ ships per day. I don't see that happening with Iran doing their best to keep the SoH closed.

As for someone doing something about it, what in the world could someone do that the US navy had been unable or unwilling to do?

Trump bowed down to global oil pressure before, he likely will again in a week or less. That's far more likely than some coalition of the desperate trying to risk it all deciding they could do what the US navy could not

 

[Furniture]

I agree, some riverboat gambler will take the risk.

But the SoH was handling 100+ ships per day. I don't see that happening with Iran doing their best to keep the SoH closed.

As for someone doing something about it, what in the world could someone do that the US navy had been unable or unwilling to do?

Trump bowed down to global oil pressure before, he likely will again in a week or less. That's far more likely than some coalition of the desperate trying to risk it all deciding they could do what the US navy could not

You keep looking at this as an "all or nothing", but the world doesn't work that way.

Iran can threaten shipping, America can waffle, and the rest of the world can accept a greater risk to shipping. All three can happen to various degrees at the same time.

Iran needs an end to the game as much as America. As it turns out, America is less vulnerable to Iran's games than some of you predicted, and the rest of the world when desperate enough will act. How they act remains to be seen, but it's more likely they turn on Iran than the world's sole superpower with global reach.

 

[Altair]

You keep looking at this as an "all or nothing", but the world doesn't work that way.

Looking at the last 6 months of this nonsense and that's exactly how the world has worked.

Iran can threaten shipping, America can waffle, and the rest of the world can accept a greater risk to shipping. All three can happen to various degrees at the same time.

You're right, but the fact remains, the globe needs 100+ ships passing through the SoH per day. That's not going to happen with Iran lobbing drones and missiles.

Iran needs an end to the game as much as America. As it turns out, America is less vulnerable to Iran's games than some of you predicted,

They are drawing down their strategic petroleum reserve at a alarming rate trying to keep prices down. They physically cannot do that much longer. They are quite vulnerable to Iran's games. They started this with 425m barrels, they are around 300m now. They physically cannot go below 160m. Tick tock.

and the rest of the world when desperate enough will act.

I have yet to see a single example of this. Not a one. Nobody is going to try to do Americas job for them, especially because it's not their war.

How they act remains to be seen, but it's more likely they turn on Iran than the world's sole superpower with global reach.

They can turn on Iran all they like, unless they can get 100+ ships moving through the SoH nothing will come of it.

What you're going to have is Trumps phone ringing off the hook yelling at him to stop.

 

[brihard]

You keep looking at this as an "all or nothing", but the world doesn't work that way.

Iran can threaten shipping, America can waffle, and the rest of the world can accept a greater risk to shipping. All three can happen to various degrees at the same time.

Iran needs an end to the game as much as America. As it turns out, America is less vulnerable to Iran's games than some of you predicted, and the rest of the world when desperate enough will act. How they act remains to be seen, but it's more likely they turn on Iran than the world's sole superpower with global reach.

Looking at the last 6 months of this nonsense and that's exactly how the world has worked.

You're right, but the fact remains, the globe needs 100+ ships passing through the SoH per day. That's not going to happen with Iran lobbing drones and missiles.

They are drawing down their strategic petroleum reserve at a alarming rate trying to keep prices down. They physically cannot do that much longer. They are quite vulnerable to Iran's games. They started this with 425m barrels, they are around 300m now. They physically cannot go below 160m. Tick tock.

I have yet to see a single example of this. Not a one. Nobody is going to try to do Americas job for them, especially because it's not their war.

They can turn on Iran all they like, unless they can get 100+ ships moving through the SoH nothing will come of it.

What you're going to have is Trumps phone ringing off the hook yelling at him to stop.

I won’t try to play catch up with the debate of the wee hours of the morning, but just a few thoughts from reading through:

The world can have problems, but individual actors need to be incentivized to act in ways that solve that. Nobody is arguing that Iran has complete control over the strait or that it can hit and kill most ships going through. Neither is anyone suggesting that some ships won’t Leeroy Jenkins through in circumstances most wouldn’t. But a small number is not enough to reestablish supply chain stability and pricing back where we’re accustomed to it being.

It’ll come down to the price signals and where we see price match risk perception. That will determine what you need to pay crews to sail the strait. That will determine what a shipper needs to risk their ship. That will determine if insurance companies will touch it - though they’re willing to nope out completely if risk is high enough. Without insurability, enough volume simply will not more. The private sector may not be willing to solve that issue at any price point because of the externality of war risk. It might be necessary for governments in desperate need of oil to directly underwrite the insurance of those ships. On the way to reaching that point, we would expect to see the costs of shipping go way up; increased costs plus the decreased supply of ‘not enough moving’ means the price of a crude reaching refiners WILL be higher. It also means that with a shortage of petroleum distillates, those prices WILL be higher, because largely producers will charge the price the market can bear until demand destruction matches demand to supply. Right now we have a market that thought things had simmered down and had prices in that seemingly reduced risk. Iran has shown the risk to hulls is still there. There’s no reason to think they won’t repeat in two weeks or two months if it suits them.

So, it’s not that no oil is exiting or will exit. But it’s not enough and will continue to not be enough. Same for fertilizer, which everyone keeps forgetting.

Shooting drones and missiles at MV Frontfelloff is the trick Iran’s relying on most, but it’s not their only one. They could, if they chose, resume shooting at major infrastructure like the gas plant they hit. Yes that invites reprisal in kind. So it depends on what incentives Iran has and what leverage they need to pull. I’m just saying let’s not forget they have a proven but little utilized ability to wreck major petrochemical facilities that could take years to repair or replace. That card is still in their hand, even if playing it would be mutually destructive. That just means we cannot assume away the risk of Iran being able to land heavier hits than they have been.

So. What we see could well be sustainable by Iran for a fair while. While oil prices can get
High enough that some companies will take bigger risks to move some out, we cannot assume away the risk that this persists. We can reasonably expect that, absent a firmer peace, oil prices will probably stay pretty volatile, will probably trend back up, and shortage of supply of oil and fertilizer from the Gulf may need to be worked around for some time yet.

 

[Colin Parkinson]

I suspect that some of the richer nations both suppliers and customers, might band together to offer insurance for the tranist. Coupled with a blockade of Iranian bound and departing ships, they will crack. Eventually many of the low level supporters of the regime will decide they have had enough and desert or turn on their masters.

 

[brihard]

I suspect that some of the richer nations both suppliers and customers, might band together to offer insurance for the tranist. Coupled with a blockade of Iranian bound and departing ships, they will crack. Eventually many of the low level supporters of the regime will decide they have had enough and desert or turn on their masters.

Underwriting of insurance risk by importing nations would be a rational policy choice.

For Iran, the next play would probably be to up the risk by attacking more physical hulls in order to dissuade shippers from trying at all and instead shifting to other markets, or, in extremis, attacking the loading terminals so that oil can’t get loaded on ships in the first place. That latter would be a major escalation.

 

[Colin Parkinson]

Underwriting of insurance risk by importing nations would be a rational policy choice.

For Iran, the next play would probably be to up the risk by attacking more physical hulls in order to dissuade shippers from trying at all and instead shifting to other markets, or, in extremis, attacking the loading terminals so that oil can’t get loaded on ships in the first place. That latter would be a major escalation.

Except that goes both ways. Iran has to expend much of it's resources on internal threats, which are going to continue to grow. I think the next military steps is to clear all of the smaller islands of their personal and equipment, either raiding them or occupying them. Long term I think control of those islands need to removed from Iran. That makes targeting harder.

 

[brihard]

Except that goes both ways. Iran has to expend much of it's resources on internal threats, which are going to continue to grow.

I mean, sure, but you’ve been saying that since the winter. Your predictions on revolution have real ‘any day now…’ vibes.

I think the next military steps is to clear all of the smaller islands of their personal and equipment, either raiding them or occupying them. Long term I think control of those islands need to removed from Iran. That makes targeting harder.

Occupying Iranian islands within tens of miles of the coast leads to a lot of dead Americans. They’ve had to essentially abandon several of their own bases in Gulf countries because they cannot adequately defend them, and those are at much greater death and safe from the larger number of lighter systems. A U.S. light force plunked down on the islands in the gulf? I’ve spoken to this before. Americans will see some of their kids taking a drone to the face on Twitter or Telegram before the casualties are even confirmed by the military and their families notified of their deaths. This COA is an absolute non-starter, even Trump has spoken somewhat frankly about this.