Open Square Capital

@leguape Possibly, but would think that's likely better handled longer-term by Hellfire equipped drones. Time on station / loiter times would be significantly longer.

A-10s also very publicly shown flying close air support for LCS (USN’s idea of counter-mine capability) in Gulf weeks prior to conflict dvidshub.net/image/9512212/… already numerous documented in theatre doing ground attack against militias in Iraq.

Dec Brent at $79/bl… down $5 today. $40 under the expiry of May contract. This is 7 months forward. Up $10 only since the start of the war. We will lose at least 1 billion bls of inventories due to that war. It could be a lot more if it lasts longer than expected. Incredible how complacent this market is. And this happens after the strongest Brent expiry ever ($15/bl).

The Nimitz-class aircraft carrier USS George H.W. Bush and its accompanying warships are deploying to the Middle East, joining the USS Abraham Lincoln and the USS Gerald R. Ford carrier strike groups in the region, according to U.S. officials. The U.S. could have three aircraft carriers in the region for the foreseeable future, the officials said. The Navy declined to comment on future operations wsj.com/livecoverage/i… via @wsj

Alas, the market wants comfort and not context.

Phys air pocket moving thru the system & each day >10M shut-ins. Despite X tantrumps, infantry likely used this wknd=gets worse b/c resolution longer. Mrkt rally is a fakeout. It's multiple expansion in a world where phys. commodity costs are ripping & getting worse by the day.

BREAKING: US industrial gas supplier Airgas declared a force majeure, telling a customer it would only meet up to 50% of their normal monthly helium demand amid the Iran War, per WSJ. Details include: 1. The world is facing a significant helium shortage amid the Strait of Hormuz's closure which has limited ~30% of global helium supply 2. Airgas also told the client that it would add a surcharge of $13.50 per hundred cubic feet above the contracted price 3. Helium supplies which are "critical for AI" have been "choked off," per WSJ 4. Hundreds of specialized cryogenic containers, each costing $1 million, are now stuck in the Middle East Global helium supply is at risk.

Iran War - Update : Negotiations are pure theater. Trump's 48-hour ultimatum was never credible. The Gulf states told him so directly as follow-through would have meant Iranian missiles on their own infrastructure. Iran offered nothing. Trump got a backroom readout from Witkoff, called it diplomacy, and bought himself two more weeks. Why two more weeks ? For troops to arrive ! ~7,000 US forces are moving toward the Persian Gulf right now. When they get there, expect ground operations. The target: Abu Musa, Greater Tomb, Lesser Tomb. Seize those, and the US gets a defensive foothold to escort convoys through. That's the optimistic version. Timeline: 2-4 weeks per Rubio. Reality: probably 4-6 week if all goes according to plan (it never does) Kharg Island stays off the table for now. You need 12-15k troops for that, and taking it likely triggers Iranian strikes on Gulf desalination plants. The Americans need to degrade Iran further before they go there. Trump's risk appetite has flipped. Oil heading to $100+ as a baseline, $200 not ruled out by Treasury. Rate cuts dead for the year. Midterms already a lost cause. So what do you do? You swing for legacy. Control the Strait. Leverage Iranian oil against China. Call it the "Strait of Trump." He literally said that out loud in Miami. Don't assume it goes smoothly. The Iranians have been sharper than anyone expected. That likely-hypersonic strike on the US base in Saudi Arabia on Friday wasn't nothing. The Strait is full of civilian boats and ringed by mountains, RPG-enthusiast heaven. Half the US Navy's amphibious ships are in poor condition with low readyness (41% mid last year). Iran absorbs this war and survives, but just about. IRGC tightens its grip on the state. Industrial base is gutted. Legitimacy collapses under the weight of repression, economic ruin, water crises, and incompetent new leadership. 3-5 year trajectory looks like either civil war along ethnic fault lines or a Pakistan-style military dictatorship. Neither is stable. Both are nuclear-adjacent problems down the road. Some but not all Gulf states come out stronger, paradoxically. Saudi Arabia is looking at +$50B/yr in oil revenue through Yanbu alone. GCC cohesion deepens. Defense spending surges. Long-term redundancy like extra pipelines to the Mediterranean/Red Sea, rail, water security, gets built in a hurry. China doesn't fire a single shot and wins. Stockpiles, state-directed subsidies, no midterm elections to worry about. Xi plays the long game, positions China as the "stable great power," and waits to be invited into the post-war multinational policing force for the Strait. Which will be a fascinating moment. Trump loses the House badly. Senate is a coin flip. What follows: investigations on every front (insider trading, anyone ?), a hobbled domestic agenda, and a president who then goes maximally unilateral on foreign policy — the one domain where he has nearly unchecked power. Ukraine gets cut loose in a side deal with Moscow. Europe erupts. NATO frays. Europe accelerates defense decoupling, builds toward its own nuclear umbrella, and quietly restarts the "variable geometry" strategy, waiting for the next US president, keep maximum optionality shopping between Washington and Beijing for whoever offers a better deal. End up commiting to neither. "Belle of the ball" strategy. This is not ending at a ceasefire. The positions are structurally incompatible. The economic damage is still being massively underpriced. And the escalation ladder still has many rungs left. Hang on to you helmets. This is the big one.

No one’s long enough oil if this happens. China, Russia, and Iran overwhelmingly wins if this happens.

Watch what they do, not what they say. These are close air support aircraft, planes that support troops on the ground. They fly slow and coordinate with forward air controllers embedded with combat troops to direct fire on enemy targets in close contact.

Lots of sleeplessness out there in Asia and Europe. Diplomatic efforts proceeding now, and it could eventually get settled by this week. We'll see, though energy scarring effects means we'll get much higher oil prices longer-term post-conflict.

Amazing, they’re battling it out over investor perception. As we’ve said though this is the key for the IRGC, the higher the market/econ pain, the shorter the war. Welcome to Iran’s hurt locker.

Today in Iran’s semi-official Tasnim news— Iranian Parliament Speaker Mohammad Bagher Ghalibaf says Iran will maintain its missile strikes, with the war now at “its most critical stage.” Ghalibaf describes Trump’s 15-point proposal to end the war as a “wish” and the reopening of the Strait of Hormuz as “an operational ambition.”

All of this makes imminent sense, but in 8-12 weeks, actually in about 2-4 wks, oil will be over $200 and Asia and EU economy will effectively shut down. Market will also have crashed. Long term scarring also means oil will be $100-120 many years afterwards

Still to this day, a month after the start of the « excursion », nobody seems to understand how exactly this Israeli devised war is not the one Israel/US thought they will be fighting. The initial month demonstrates that this is morphing into something bigger and longer. 1/11

This sounds terrible.

Fight's on.

This far into the war - and with no obvious end in sight - we've learned a few things: 1. The US and Iran are engaged in diplomatic shaping operations, not negotiations. Each side presents a maximalist position, and both insist the other is desperate. It would be great if Iran agreed to the current US terms - on nukes, missiles, proxies, etc. - but it won't. The current posturing could lead to real negotiations, but that will probably require more time - and fighting. 2. Watch the troops, not the talks. The diplomacy buys time for thousands of US ground forces to assemble in the region. There is a lot of talk about taking Kharg Island. Maybe, but doing so would not automatically solve the key U.S. problem, which is the blocked Strait of Hormuz. Other operations - along the Iranian coast or otherwise - may do more to open the Strait, and therefore be more likely. 3. Significant escalation potential here remains. Gulf Arab states could start shooting into Iran. The Houthis could enter the fight and block the Bab el-Mandeb. Israel could proceed with a ground invasion and occupation of southern Lebanon. Shia militias in Iraq could become more militarily active. The US and Iran could increase strikes on regional power and energy infrastructure. All of that is wholly apart from the potential engagement of US ground forces. 4. The White House continues to pare back its objectives. Out with regime change, the right to choose Iran's supreme leader, and unconditional surrender. Now Tehran must commit never to develop a nuclear weapon. But Iranian leaders made that commitment over and over before the war started. The aim should be to change Iranian capability - degrading its drones, missile, navy, nuclear, and defense industrial base - rather than a grand attempt to alter Iranian will. 5. Declaring victory and moving on is no longer an option. CENTCOM will likely complete most of its target set in another week or two. But that still leaves a closed Strait, which must open via agreement or force. The President's ability to spin situations as success will face limits here; everyone will know if the Strait remains closed, the price of oil still high, and the drag on the world economy still significant. 6. Once the Strait is reopened, the US will want to guarantee its security with an international coalition escorting ships and conducting patrols. For that we need allies and partners. The current approach of insulting and threatening them is not particularly productive. Leading them in a common effort would be a better approach. 7. After the shooting stops, we may see eerie parallels to 1990s Iraq. In 1991, the U.S. liberated Kuwait but was left with a weakened, hostile, and deeply repressive Iraqi regime still in place. Containing it required harsh sanctions and the long-term engagement of U.S. forces over years. In 2026, this war may well leave a weakened, hostile, and deeply repressive Iranian regime still in place. Containing it may require harsh sanctions and the long-term engagement of U.S. forces over years. War's unpredictable, so anything is possible. But we may be seeing a rough replay of an old movie.

So how many fake Tacos can investors eat before they get full? (1st - almost done; 2nd - Israel hit South Pars without Trump knowing, 3rd - negotiating and deadline postponed; 4th - 15point plan)

Market futures are barely positive following Trump's second TACO. Be wary if TACOs aren't TACO-ing. This could slide fast as SoH stays closed.