Marginal Thinking

@policytensor @AOC_For_2028 @XxXxALVESxXxX Even if that much oil is getting out, does it matter if production is still shut in? Maybe it shortens the time from peace to normalization if fewer ships are trapped, but days with shut-in production is the real cumulative leverage point right?

@AOC_For_2028 @XxXxALVESxXxX But see x.com/DropSiteNews/s…

Is Izadi right? His 5 points are not invalid: 1. Ending the siege ends the cumulating pressure on Trump. 2. US can build back strategic oil reserves and weapons inventories; although less rapidly for the latter. 3. Thus opening the door to the dreaded possibility of ‘a cycle of attack, ceasefire, negotiation, attack’. 4-5. Sanctions are unlikely to come off given DC political economy. On the other hand: 1. It has been established beyond reasonable doubt that the US does not have the military means to disarm Iran. This is a formidable deterrent bc it is now really hard for US security principals to convince themselves that the next time will look any rosier. 2. US magazine depth has been depleted so badly that Iran will have the opportunity to build formidable missile capabilities, air defense, fiscal room, and maybe even a nuclear deterrent before the US comes back for yet another round, even if it decides to do so given (1). 3. The war of the sieges is more dynamically competitive and less capable of one-sided pressure yielding a strategic decision than was hitherto believed to be the case. The issue is that too much oil is leaking from Hormuz. And this is not a trivial problem to solve. The only good solution is a Red Sea blockade. But that would remove the gun from the Saudi temple. Given Tehran has received checks from the Saudis, Emiratis and Qataris, it will be even more difficult to leverage coercion of the Gulf Arabs to indirectly coerce DC. 4. Money itself it a direct input into Iranian military power, as well as providing relief to the populace and thereby shoring up public morale. With $50-100 billion in the kitty, Iran can invest a lot more in missiles, drones, air defense, and naval capabilities to deter or defeat the next round of attacks if they come. With that kind of money, Iran can buy dozens of S-500 systems, rapidly stockpile hypersonic missiles, and upgrade terminal guidance for its existing inventories. 5. There is also the important question of general deterrence. Has the US experience from this round been so nasty that US security principals would think much harder next time before attacking Iran? There are no guarantees about this Administration. But I can say with some confidence that US elites have been chastened. At the minimum, even if the impossibility of ‘finishing the job’ is not admitted by many commentators, there is a near-consensus in America that the costs and difficulties of the project to gut Iran had been severely underestimated. This is the recipe for general deterrence.

@calvinfroedge I’ve heard they can just roll that out though—presumably beyond 2028

As one commenter pointed out the interest is paid in barrels not dollars This matters

When the US strategic reserve draws end and the loans need to be repaid plus 20%, it will put upward pressure on the oil price All of the price insensitive selling not only ends but it completely reverses and begins to pressure commercial inventories

@BrettErickson28 Personally, my money is “reconstruction fund” or “investment fund”

I think you would have to be either insanely naive, or exceptionally disingenuous to believe the United States will not be delivering pallets of cash to Iran to end this conflict. “Humanitarian aid”, “Gulf payments”, “Security guarantees”… whatever you want to call it, they are payments made at the authorization of the United States to Iran.

@BrettErickson28 @CliffordDMay To be fair, that last outcome is an improvement (albeit not one he intended to produce).

@CliffordDMay It’s laughably ridiculous. He made everything worse, and ensured no U.S. president in the next 250 years screws with Iran.

True. So what an error it would be to give away that progress.

@TankerTrackers @DiveBomb321 Thank you; how long do you think this volume has been happening? And I guess related, how much volume of oil do you think is still trapped in the gulf at this point?

@marginthinking @DiveBomb321 SoH.

Seems about right if you also take into account the dark transfers of various crude oil and refined products from the Arab nations. Yesterday, we tagged ten large sets of STS transfers in the GoO following their dark, US-escorted passages via the SoH. Iranian crude still remains trapped within the greater US blockade perimeter even if loadings take place every now and then at Iran’s five key crude terminals.

Without question, the United States authorized this transfer of $3B from UAE to Iran. We threatened to bomb Oman over a couple of “maybes”… you better believe the U.S. wouldn’t stand idly by and let UAE give Iran this money without our consent. Pallets. Of. Cash.

@BrettErickson28 This would also appear to explain why Fujairah wasn’t on the target list this week when it otherwise seemed like an obvious strategic target for Iran.

New reporting from Reuters indicates that Iran has ALREADY received THREE BILLION in frozen assets from the UAE. There were initial murmurs about this over the past 72 hours, but no actual solid reporting… that’s different now. While it does not surprise me that Iran is already getting paid out, this is the first SOLID reporting I have seen that confirms it. reuters.com/world/middle-e…

This is likely why recent Iranian attack waves did not include the UAE.

@AndreasSteno Do we have any independent reporting validating this? Chris Wright also once declared the navy had escorted a tanker through mid-war, before retracting it. Why should his pronouncements be treated as credible?

*US ENERGY SECRETARY: FLOWS OUT OF PERSIAN GULF ABOUT 7M B/D Wow, this is WAY WAY WAY more than any pundit dared to imagine (but very much in line with my longheld thesis)

@rd_observer @Tracking_Power I agree--especially if there isn't a withdrawal, it's a virtual certainty there would be daily violations. Unclear how that would influence the other negotiation track (if we even get there, of course).

Just frozen in place during the negotiation period though - what we have seen in the last 2 years, even that is an uphill task. The meaning of ceasefire is changed with this war. And anyone on the planet can imagine: there won't be a single strike in Lebanon and Gaza for a week or a month? Impossible to process for the moment unless I see for a week.

According to my sources, this report on the ceasefire agreement, from Fars News, is all true; and the most accurate account yet of what has happened in the past few weeks in the negotiations between Iran and the U.S. *Neither the missile programme, nor the support for the Axis of Resistance were ever on the table. *Nothing conceded on Uranium. Will be discussed in the next phase. * Ceasefire on all fronts. This is obviously a humiliation for Trump and the Zionists, but much more importantly, it’s a world-historic defeat for the U.S. and the Jewish State. Perhaps a word should be entered for the facilitation of this by Qatar 🇶🇦 ————- 🇮🇷🇺🇸- According to Fars News, it appears increasingly likely that Iran's proposed text will receive final approval from Iranian authorities, given that the US has now returned to accepting it. ➡️ According to information from Fars, approximately two weeks ago the draft memorandum of understanding between negotiating teams was nearly finalized and awaiting final approval in both Tehran and Washington. ➡️ However, Trump then demanded the addition of new clauses, contradicting what American negotiators had already agreed to, prompting Iran to stop responding to the US entirely. ➡️ Negotiations were effectively frozen due to tensions in the Strait of Hormuz and the Dahieh strike. The Qatari mediation team resumed talks yesterday, revealing that the US had retracted its new demands and reverted to the original text. Ultimately, the US has made concessions, while Iran has not yet responded.

@BrettErickson28 My theory is that Trump said he accepted this to produce a level of calm through the weekend because of IPOs, birthday, and the UFC shenanigans with little to no intention of following through. Similar to how he said he accepted Iran's 10-points to get the original ceasefire

Trump rejects the leaked MOU terms… and I have to say… I believe him here. Don’t get me wrong, the inevitable terms of the MOU will be absolutely terrible for the United States. 100%. But these current leaked terms… $300B reconstruction fund, $12B of assets unfrozen up front (that will happen by the way), oil sanction waivers (that too), removal of US troops from the region, full cessation of hostilities in Lebanon, etc etc etc… It’s too much, and Iran knows that. Iran, throughout the ENTIRETY of this conflict, has been the rational actor. Strategic. Methodical. Calculated. The United States, on the other hand, has been scattered, desperate, and flailing. Iran knows that Trump needs SOMETHING to sell domestically as a win in order for him to exit the conflict. Iran may HATE Trump. They may HATE the United States… but they’re not, as much as the Israeli Lobby and Iran Hawks want you to believe, complete lunatics. Under the eventual MOU, Iran will not get everything they want. The United States will not get everything they want (obviously). But my HOPE is that the mere RUMORS of the MOU isn’t enough for the Lobby and Hawks to claw Trump to shreds so much so that he backs away from a peace deal entirely.

@rd_observer @Tracking_Power I believe Lebanon is included in the 14 points of the MOU, but not Gaza. Not sure whether this means outright Israeli withdrawal or just frozen in place during the negotiation period though.

@Tracking_Power I just want to know - is there an end to war in Gaza and Lebanon (not Beirut)?? The rest of the things - Iran can enjoy.

@ProProp5 @ALikhodedov @LVision_Trading @CRUDEOIL231 I think the USG would want scream it from the rooftops if this was happening (or a chance it was happening). GCC might be happy to keep it quiet, but not sure Trump could be discrete

@ALikhodedov @marginthinking @LVision_Trading @CRUDEOIL231 Could it simply be unreported?

$OIL TRUMP: US secretly moved 100M bbl out of Hormuz. MATH: ~50 VLCCs stealth-escaped Persian Gulf since early May FACT: 39 VLCCs still stuck in the Gulf TODAY SO: either we had ~90 VLCCs stuck in the Gulf in early May OR… Trump scored F in math again.

Axios should just make this a pinned tweet.

@Rory_Johnston @mike_klinge Can you link to it so we can all have a laugh? I somehow missed this particular hallucination.

@mike_klinge It’s a real thing that someone published. It’s not a real thing that actually happened.

If I had a tracker that showed Hormuz transits at 200% of prewar levels while missiles were flying overhead I'd probably wait a hot sec before pressing the publish button.

Earlier today, a new article from The Washington Post highlights how oil executives have moved from politely knocking on the door of President Trump... to taking an axe to the door frame. "Some inventories could be wiped out within weeks, the executives have warned, coinciding with the peak summer travel season." Mike Somners, the CEO of American Petroleum Institute said earlier this week: “We’re sounding the alarm on these inventories going to record lows,” said American Petroleum Institute CEO Mike Sommers on “Mornings with Maria,” a Fox Business program that Trump frequently watches. “We should be concerned about what prices we’re going to see over the next few weeks. We have to solve this problem in the Strait of Hormuz.” One of the ways that the Trump Administration is trying to solve this, is by running a de fact "Operation Freedom 2.0". In statements made in the Oval Office yesterday, President Trump stated that "200 vessels" carrying "100M barrels of oil" had been "guided" through the Strait of Hormuz by the United States over the last ~40 days. This amounts to a WHOPPING 2.5M barrels per day. Before the conflict? 20M barrels per day were being exported through the Strait of Hormuz. This equates to ~12.5% of normal oil flows. But fertilizer? Bulk shipping? LNG exports? Nope. Nope. And nope. Operation Freedom 2.0 makes zero sense whatsoever, and more importantly as we saw just earlier this week with the shootdown of the American Apache helicopter, it exposes US troops to grave and mortal danger. What else? It doesn't actually address the root cause, only the symptoms. As I told The Washington Post in this piece: “The president is making a remarkably dubious claim,” said Brett Erickson, managing principal at Obsidian Risk Advisors, “And even if some ships are getting through, this is not a long-term solution. Are we going to perpetually be the chauffeur for the Gulf?” At BEST, this offers an atrocious risk-reward profile that only works... until it goes catastrophically wrong. At WORST, it has drawn the United States back into an unwinnable war with Iran. washingtonpost.com/politics/2026/…

@guy_laron @Kpler @FT Are there any indications that the US nighttime operations have allowed GCC to restart production? If not, we’re just moving deck chairs on the Titanic, by changing the geographic distribution of draws without changing the aggregate amount.

@Kpler @FT 19. In short, the shadow fleet that the U.S. moves through the Strait of Hormuz is a holding action while adaptation kicks in.

1. The debate over the Strait of Hormuz chokepoint is stuck in economic metrics. Analysts are obsessed with volume, counting lost barrels. But as a historian, I argue they are missing the real geopolitical currency of a crisis: Strategic Duration. 🧵

@ALikhodedov @LVision_Trading Have you seen any indications that onshore storage in GCC is being emptied through this exercise or that they’ve been able to restart production? Seems like that is the real test for whether this matters for the overall oil deficit vs just changing timing / geography of draws.

I think the idea there is that small ships belonging to Kuwait/UAE/Iraq NOCs shuttle through the Strait back and forth at night close to Oman coast with lights off. Since they go back and forth (FT estimates the avg number as 15 in total - both east-west and west-east) they do not change the vessel count much. and then S2S on VLCC or other large tankers in GOO. This FT article has some details x.com/ftenergy/statu…