Full conflict has resumed, and the problem for the West is oil has been further depleted. After the MOU was signed, oil flows recovered to about 25% of flows prior to the war. So, global oil reserves have still been used to keep things moving.
I recently saw a video accurately examining Iran's strikes on countries in the Gulf. The extent of damage is much greater than has been disclosed previously.
This is very serious.
The US may go to war against Iran on the ground. This is next level stupidity, but the US appears upset that it lost the war.
Who to believe? The US and its tame media says that it has delivered a stunning blow to Iran. Meanwhile, Iran says it has caused serious damage to US interests in the Persian Gulf. The below report seems to substantiate the latter; US bases in the Persian Gulf have been severely impacted.
The 'deal' between the US and Iran hands Iran a huge win. Key in all this is the next 60 days. Over that time, while the final deal is being drafted, global oil reserves will be run down more and yet only a trickle of oil will leave the Persian Gulf. Moreover, oil that does get out will take time to process when it arrives at refineries. Iran can simply shut down the Strait of Hormuz again and completely crush its enemies.
Iran did not get everything they were after, but they've clearly won the war that the US started. Before the war, the Strait of Hormuz was open, operating as an international waterway. Now, fees will be paid by commercial vessels transiting, and Israeli vessels can be excluded.
Iran do not get sanctions relief, but half of the money held overseas will be freed up. The Gulf States have guaranteed to pay, thus, if the US do not release the funds, then the Gulf States will pay regardless. Basically, Iran is going to be rolling in cash. That'll make Pakistan, China and Russia very happy as Iran will buy more from them.
A quick scorecard, winners and losers:
Winners
Iran - their oil revenues have increased since the outbreak of the war. According to the Wall Street Journal, they're now selling 985,000 barrels of oil per day to China via the rail corridor that runs through the Stans between Iran and China. The marshalling yards for this traffic sit within Turkmenistan, and that's where loads are taken off standard gauge and placed upon the old Soviet wide gauge track. The trains are about 50 wagons long, 66 tons each wagon, and each oil tank holds about 400-500 barrels. Iran charge China's 'teapot' refiners Brent + $1.50. This compares with volumes of about 1.38m bpd via the Strait of Hormuz before the war. Thus, Iran in revenue terms is raking in about the equivalent of 1.5m bpd levels from before the war. They knew they were going to be attacked. Leading up they were shipping a lot of crude and simply parking it out there on the water. The US then lifted sanctions on this oil and Iran profited. They must have laughed. Iran also has rail links with Russia, Pakistan, and via the Caspian Sea and into Russia's Volga-Don canal system and ultimately the Black Sea. Iran now has complete control of the Strait of Hormuz, and it remains shut to those it considers its enemies.
Israel - they are now the US's only remaining ally in the region. They would have noticed the rise of the UAE, Qatar, Bahrain, Kuwait and in particular, Saudi Arabia. These states have been selling their soft power, with Saudi Arabia using sports promotions like LIV Golf to sell themselves. Israel won't have been happy with this overall, and now they can sit back and watch these states distance themselves from the US.
Russia - they're happy with the high oil prices. They've shut down the pipeline from Kazakhstan to Germany, likely motivated by the incentive of lifting prices.
Losers
USA - their attack has resulted in a massive strategic defeat. They've compromised food security and the world economy generally. American farmers will be livid as the attack on Iran came just before planting - not good timing.
Gulf States - they were mistaken in thinking the US could protect them. Dubai may come back to an extent, but people will never forget, and zero tax doesn't help one bit when a bomb may land on your bonce.
Asia (apart from China) - all Asian countries have been compromised and they'll likely move toward greater independence and away from the US.
China - they'd prefer the Strait of Hormuz to open, for conflict to end. They won't be greatly adversely affected but given their merchant outlook, they'd profit from less conflict, not more.
Oceania - they stand to go out of existence if they don't quickly get their act together.
Africa - famine is possible, and their oil fields and refineries are only just now being built. This war came at a bad time for them.
Europe - deindustrialisation has proven to be a fool's errand. They're badly exposed with high cost structures and with few allies.
North, South and Central America (apart from the US) - they've been compromised, but countries like Canada have gained from their own oil sales to Asia. The picture is patchy, but overall a loss.
The war has benefited very few interests, and harmed most. End the war now.
What has been happening to the crew stuck on ships caught in the Persian Gulf? I've been wondering if some crew may simply abandon ship, and then row to shore while leaving the vessel anchored.
A bit of simple arithmetic is needed to explain why the closing of the Strait of Hormuz could destroy the economies of Australia and New Zealand.
Both countries rely on imported refined product from Asia. New Zealand is wholly dependent while Australia is about 90% dependent. China has ceased exporting product, so cross them off the list. That leaves, for the most part; South Korea, Singapore and Malaysia as suppliers.
South Korea processes up to 3.4m bpd (million barrels per day), 2.5m of which is consumed domestically. 70% of their supply comes from the Middle East.
Singapore processes about 1.5m bpd, and they import 70% of their oil from the Middle East.
Malaysia processes about 900,000 bpb, and they import about 40% of that oil from the Middle East as they have their own oil wells. Domestically, they consume about 77% of the total and export the rest.
I trust you may begin to see the problem. With a huge amount of Middle Eastern oil coming through the Strait, but now shut off, these Asian economies will need to prioritise their own market first, and even then they'll come up short.
South Korea has begun buying oil from Canada, about 800,000 barrels per day. That's well short of the 2.4m bpd needed. They can only just supply themselves, leaving nothing to export.
Singapore looks set to lose 1.0m bpd, and that equates to the daily consumption of Australia. Forget NZ, they'll just be left to fail.
Malaysia, just to supply its own needs, will have to import from other sources, just as South Korea is doing.
All of this adds up to a very serious predicament Downunder. I see the Philippines has declared a state of emergency, and that is a wise thing to do. Australia and New Zealand need to follow suit as this war in the Middle East could drag on for a long time, that much is obvious.
Another link - what to do NOW https://kenhorlor.blogspot.com/2026/03/new-zealand-fuel-crisis-action-required.html
If reports are to believed, big IF, then Iran is now one of the big four, and the big three of US, China and Russia have a new member. Iran has defeated the United States.
For a ceasefire to be called, Iran had ten key demands, and Donald Trump announced he's accepted all of them. This leaves Iran in complete control of the Strait of Hormuz, the Persian Gulf is now its lake.
The US defeat in Afghanistan was the biggest defeat of a western country in history, ancient or modern. Now, this surpasses that. But then, the ceasefire may end within 24 hours, who knows? One thing is for certain, countries are going to find it hard still as the oil isn't flowing yet, and it may take a year or two for flows to resume even if the will exists to make it so.
Update: thinking about this some more, this appears to be Iran's Battle of Britain moment. I'll explain, the BoB was a defensive action, with Britain's goal of avoiding outright defeat. The way the Germans saw it, they were simply trying to knock Britain out, then when they'd done that they turned around to deal with the bigger threat, Russia (then known as the USSR). Thus, Britain claims victory as they were still standing when the attacker quit. Germany, however, say they did not lose, they just changed priorities.
The reality was that Germany was losing aircraft at a rate where they could not replace them. Most losses were on the ground in takeoff and landing, in fact, not fighting in the air. If Germany had continued, they'd have simply run out of planes, while Britain's industry could replace theirs. The Germans badly underestimated the industrial output of the British Midlands.
This appears to be a similar situation in the Gulf. The US lost 11 or so aircraft just rescuing one downed airman, and their bases have all been destroyed in the region. Their carrier strike group has had to retreat well into the Arabian Sea, well away from cruise missiles. Scuttlebutt says that Trump did launch an attack on Iran, in line with his ultimatum, but that every Tomahawk cruise missile was taken out by Iran. He buckled after that, and I'm speculating he was told that the US was fast depleting its ordnance and that it couldn't be easily replaced.
Israel has announced they do not consider their offensive in Lebanon as being covered by the ceasefire, and the Gulf states will be unhappy ending up effectively satraps of the new Iranian empire. Therefore, this ceasefire is unlikely to last any more than a few hours or days - we'll see.
And think, we have a Soccer World Cup coming up, that will be interesting.
I always say that given long enough to think about it, the US, all of Europe and Israel will come to the conclusion that it is China's fault. Convince me I'm wrong.
It looks like WWIII is about to start. Military strikes on Iran's oil and gas facilities may force China and India to join the conflict on the side of Iran. They need to do this, especially India, as they're already experiencing shortages and India, in particular, has a large population that needs gas to cook their food with.
Russia and North Korea could then follow. South Korea are now in dire peril. North Korean artillery can easily bombard Seoul, the capital of South Korea. I don't see how South Korea could hold out.
With China and India involved, they'll be able to get their supplies out of the Gulf, and they'd take effective control of all oil and gas coming out of the Gulf.
Targeting oil and gas complexes is a massive escalation and an act of utter stupidity.
Here's an idea, New Zealand should move to mop up all the money that will be fleeing the United Arab Emirates right now. All those seeking the tax-free life, don't like receiving messages on their phone telling them their friendly neighbourhood missile will be arriving shortly.
A few years ago I suggested NZ set up a tax-free zone in the East Cape. Let's do this now. For people from overseas, we could take part of the coast and designate it tax-free so long as they stay resident for 120+ days of the year (or something).
https://kenhorlor.blogspot.com/2017/07/make-east-cape-monaco.html
https://kenhorlor.blogspot.com/2018/06/making-east-cape-monaco.html
Iran has clearly prepared for this and are setting about blocking the Strait of Hormuz. They're being successful at it, and are now attacking tankers and oil transfer facilities in the region.
For Australia and New Zealand, this is becoming an existential crisis. Already, farms in remote rural locations in Australia are finding they cannot obtain diesel. Hardware stores have sold out of jerry cans as people stock up.
New Zealand is steadfastly blundering onward, their heads firmly in the sand. The country's leaders are woefully incompetent, it's like leaving a bunch of ten year-olds in charge. Here are some things to think about, diesel is essential to the nation, thus:
Here's a rational explanation as to why the closing of the Strait of Hormuz is NOT an apocalyptic crisis. Although I'd add that some regions will be far more seriously impacted than others. The Far East, South-east Asia and Oceania being top of that list. China has stopped exporting fuels, which further restricts supply to the region.
Commentators predicting an oil crisis following Iran's closing of the Strait of Hormuz are well wide of the mark. That is because Saudi Aramco has started shipping more oil out of its Red Sea facilities (see link). Furthermore, Egypt is offering its pipeline to move Saudi oil to the Med.
https://www.hellenicshippingnews.com/egypt-offers-sumed-pipeline-to-facilitate-saudi-oil-exports-amid-hormuz-closure/I've also seen predictions that some of the people in the Gulf states will starve. But anyone looking at a map will see that there is a land corridor to these states, and so food can get in to feed stranded tourists. The same land corridor could be used to evacuate people from Dubai, Doha and the like. Buses are starting to look mighty useful.
However, there are some serious issues regarding the viability of the United Arab Emirates long term. Dubai as an airport hub could be lost. Ethiopia has been promoting Addis Ababa as a useful mid-point stopover, and they've commenced building a new international airport there.
Dubai's status as a tax haven sanctuary may be over, too. The rich don't like adding bombs to the risk assessment. It'll also be interesting to see how the large sovereign wealth funds based in the Persian Gulf fare now that their economies are toast. This will massively impact the United Kingdom. Interesting times ahead indeed.
Iran appears to have lost its navy and air force, and this war will end when it runs out of ordnance. I give it another three weeks at this rate. Will China and Russia come to their aid? I doubt it, as Russia has its own issues, plus it'll be selling more oil right now. China tends to be all talk; they've never won a war, and if they enter the fray, they too will lose their entire navy.
South Korea, Japan, South-East Asia and Oceania may experience the rapid onset of an energy crisis, and in Australia and New Zealand, there seems to be little urgency. The latter two really do have useless leaders.
