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strikeJul 16, 2026

Cracking Up And Joining Up

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Cracking Up And Joining Up By Michael Every of Rabobank Geopolitics is front and center, even in Argentina–England at the World Cup, where the contested Falklands/Malvinas, which could have oil reserves, saw jingoist 1980’s language. Yet it’s Hormuz, where 1980’s-style tanker wars are underway, that’s the penalty spot. The US is striking Iran again night and day, as Tehran warns of an “existential war”. Reports have Trump leaning towards expanding US military operations; others say what he’s been hitting widen his options for escalation; and Trump has stated Iran “will be defeated soon.” However, the Financial Times today leads with Trump’s ex-defence chief saying the US will not win the war from the air, a sentiment echoed in the Wall Street Journal – and boots on the ground are highly unlikely. Iran is attacking the Hormuz oil lifeline of ship-to-ship shuttle runs, with some vessels now reportedly refusing US-military guided transits. The US just hit a tanker heading for Kharg Island under the renewed Iran blockade, as some wonder again if the US could try to take control of Iran’s southern islands – which would certainly take boots on the ground. The IRGC has threatened all global energy workarounds to Hormuz: that includes the Red Sea, where the Houthis may be preparing to attack; it might also involve Azerbaijan’s oil trade with Israel, meaning either striking Iran’s well-armed northern neighbour or the Eastern Mediterranean route its oil arrives via. Markets would move markedly if these developments were to occur. Israel-Lebanon talks are getting some results, with agreement for Israel to pull back from two pilot zones to allow the Lebanese army to prove it can keep the territory free from Hezbollah – the IDF notably just killed three of the latter, and Trump is still talking about Syria fighting Hezbollah instead. PM Netanyahu will meet Trump in the US on Monday, as many fault lines are seen between the two. However, the flurry of radical domestic legislation the Israeli government just launched ahead of an October 27 election Knesset dissolution may suggest the foreign policy arena is not where they will look to flex for would-be voters. Elsewhere, US General Caine is pleading with defense contractors to build weapons faster, as munitions constraints linger: the US Air Force plans to buy 28,000 low-cost cruise missiles ahead, showing procurement pivots are happening. The Secretary of War is also going to give US troops testosterone shots to make them stronger, as many NATO allies struggle to recruit the soldiers, sailors, and pilots that a military build-up will require; and senior defense officials are pushing for more censorship and are said to be looking at Cuba military options. The EU again failed to strike a new Russia sanctions deal after three days of talks, with Athens reportedly opposing them to shield a Greek shipping company. On the other hand, the EU and Ukraine struck a deal to tap into €10bn of unspent SAFE funds to build drones in Ukraine – with a carve-out to buy some components from China. Ominously, Lithuanian and Latvian leaders also warned that Russia is planning infrastructure attacks on the Baltics or Poland, with other suggestions of potential false flag operations as the trigger for such. Against that backdrop, and what Ukraine is doing to Russian refineries, a benchmark Bloomberg measure of crack spreads now stands above the panic peak of 2022, so while Brent oil is $85 --bang in line with where Joe DeLaura expected it to hover at while ‘Comfortably Bomb’ plays out-- the price of a barrel of diesel is around $147.   The EU also just published a report calling China a “key enabler” and a “crucial enabler” of Russia’s war on Ukraine, further noting that: “At the centre of this transformation lies the determination of some powers, Russia and China foremost among them, to establish regional dominance and reshape the global order in line with their interests, fostering a return to a sphere-of-influence logic.” That language echoes European complaints already made about the US, as a Pew survey shows that Xi now beats Trump in terms of popularity. But given nobody gets to vote on that, how much does such soft power matter? In that regard, the X thread from the US Under Secretary of War poopooing the idea of Middle Powers having options other than siding with the US (or China), which we noted yesterday, drew polarised reactions. Those who pushed back strongest came from politics or economics, with a few from the military; by contrast, those who said the blunt (so unhelpful) US argument was true think across those disciplines. As a good example, Velina Tchakarova’s ‘The Middle Power Mirage: Colby, the Sceptics, and the Verdict Nobody Wants’ states: “Here is the strategic reality the convening class prefers to avoid. We are in a new Cold War between two systems, Pax Americana 2.0 and the DragonBear, the structural alignment of Chinese and Russian power across every systemically relevant domain. In that contest, middle powers without sufficient strategic leverage or autonomy will not be neutral conveners. They will be the first victims, hollowed out or cannibalized for the sake of global supremacy, or they will become the battlefield itself. There is no comfortable third space for the underprepared.” She also underlines that preparations can be made for that kind of third space, but they are fiscally, political-economically, and even ‘civilisationally’ uncomfortable. That’s as EU-China trade data this week saw Brussels state that safeguard measures permitting tariffs and quotas against import surges may “become legitimate on a case-by-case basis.”; the UK Treasury suggest alignment of its financial system with the US, not the EU, and a stablecoins framework that opens the door for the USD variant to be used; Bloomberg says ‘Trump's Aides See China Cheating on Trade, But Shun Retaliation’ - there are too many fish to fry in Hormuz, it seems; and India’s PM Modi is pushing to cut import reliance to shield the economy from shocks. Against this backdrop, national elections are now more existential than during the 2000’s policy consensus for ever more globalisation. Today, each vote can push or pull economies towards one of the two global poles of power, tipping the balance between them and/or legacy vs emerging stakeholders within them. In that light, Trump is to give an address today focused on “free and fair elections” rumored to be politically explosive, as Democratic Party Senator Fetterman warns he’ll leave the party if it turns its back on Israel, and Supreme Court justices worried about their safety were told by Congress, “There’s not a money fairy up here.” In the UK, the terror inquiry into the murder of former MP Ann Widdecombe continues, as a man was arrested for threatening to shoot Reform UK leader Nigel Farage, who is involved in a scandal over a cash gift ‘for his security’. The Times of Israel opines that ‘Netanyahu hits new lows in his battle for survival; there will be a great deal of damage for better leaders to undo’; and Ukraine’s President Zelenskyy just ousted his reformist defence minister amid a government reshuffle, which critics have called a serious strategic error. In short, norms are cracking up around us, not just in refined products, but in less ‘refined’ economics and politics. To predict how this plays out one needs to join things up; and that involves looking at who is willing to join up, and where. Tyler Durden Thu, 07/16/2026 - 09:30

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  • Tyler DurdenBy Tyler Durden

    Cracking Up And Joining Up By Michael Every of Rabobank Geopolitics is front and center, even in Argentina–England at the World Cup, where the contested Falklands/Malvinas, which could have oil reserves, saw jingoist 1980’s language. Yet it’s Hormuz, where 1980’s-st

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strikeUnverifiedUSIranProxy
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The government has said the UK is “ready to defend itself” after Iran’s military warned that any bases being used by the US were “legitimate targets”. The UK has allowed the US to launch “defensive” operations from British bases hosting American planes since the start of its war on Iran but has refused to help in offensive operations.

That policy has not been altered by the new prime minister, Andy Burnham, who was notified last week that a decision had been made to extend the agreement with the US. Iran’s Islamic Revolutionary Guard Corps said on Thursday that “any base used for aggression against Iranian territory constitutes a legitimate target for our forces”.

In a statement published on the IRGC-linked Tasnim news agency, the group said American bombing missions had been launched from RAF Fairford in Gloucestershire two days earlier. The statement came after the US carried out a 12th consecutive night of strikes against targets in Iran.

The Ministry of Defence has not commented on whether Fairford was used by the US for operations against Iran this week. The IRGC also accused the “British monarchy regime” of causing being the “primary cause of hardships in our region with a black record of partitioning Islamic nations, widespread massacres, imposing despotic regimes, and organising the occupation of Palestine”.

It warned the government “not to weigh down its record any further”. A spokesperson for the British government said: “Our armed forces are ready to keep the United Kingdom safe from any kind of attacks, whether it’s on our soil or from abroad. The UK stands ready 24/7 to defend itself.

“This includes through operating a layered approach to air and missile defence, provided by Royal Navy, British Army and Royal Air Force assets equipped with a range of advanced capabilities, working closely with our Nato allies. “We are committed to defending our people, our interests and our allies, acting in accordance with international law and not getting drawn into the wider conflict.

” On 1 March a drone struck the RAF base at Akrotiri in Cyprus, hitting a hangar, and prompting a partial evacuation of the facility. On 19 March, Iran fired two ballistic missiles at the UK’s Diego Garcia base in the Chagos Islands. One reportedly failed mid-flight, while the other was shot down by a US airship.

Iran has launched strikes against countries in the Gulf that house US military bases, including Bahrain, the United Arab Emirates and Kuwait, killing American service personnel in some of the attacks. Donald Trump said Iran would “pay a big price” for killing US troops.

On Thursday afternoon, the US president said he was considering ordering a “massive attack” on Iran. “I am close to making a decision,” he told Axios. “We’re all set for it.” He said he believed Iran’s leaders “want to negotiate”, but aren’t yet ready to make a deal.

In another sign of the conflict potentially escalating, Yemen’s Iran-backed Houthi rebels said they attacked two Saudi oil tankers in the Red Sea on Thursday, as oil topped $100 a barrel.

strikeUnverifiedUSIranProxyRussia
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September WTI crude oil (CLU26) on Thursday closed up +5.36 (+6.17%), and September RBOB gasoline (RBU26) closed up +0.0793 (+2.44%). WTI crude oil prices (CLU26) rallied more than +6% on Thursday after the Iran-backed Houthis launched a missile and drone attack on two Saudi Arabian oil tankers in the Red Sea, expanding the oil disruptions beyond the Strait of Hormuz and threatening oil shipments in the Red Sea.

Sep Brent crude oil prices (CBU26) on Thursday rallied above $100 per barrel for the first time since May. President Trump said in an interview with Axios on Thursday that he is considering a “massive attack” that would be “bigger than ever before” and is “close to making a decision on it.

”Don’t Miss a Day: From crude oil to coffee, sign up free for Barchart’s best-in-class commodity analysis. The Houthis have vowed to blockade shipping linked to Saudi Arabia and warned shipowners against calling at the nation's ports. The move threatens Saudi oil exports from Yanbu, a Red Sea hub that the Saudi's are using to ship crude since the war brought shipping through the Strait of Hormuz to a near halt.

Meanwhile, the US and Iran exchanged attacks for the 12th straight day, and the US maintained its blockade of Iranian oil shipments in the Persian Gulf. Global crude oil supplies are tightening due to reduced flows through the Strait of Hormuz. The International Maritime Organization warned last Wednesday that it is too dangerous to cross the Strait of Hormuz at the moment, and visible transit through the strait has fallen sharply as Iran continues targeting tankers attempting to transit it.

Crude prices also have support as Ukraine intensifies drone attacks on Russian oil infrastructure. Russian crude production fell to 8.928 million bpd in June, the lowest in 2.5 years, according to monthly OPEC data. According to EA Analytics, Russian crude-processing rates will average 3.

51 million bpd in July, the lowest in 24 years, amid damage to Russian energy infrastructure caused by drone and missile attacks from Ukraine. According to Bloomberg, Ukrainian forces have attacked Russian fuel-producing facilities more than 50 times this year, hitting at least 24 of Russia’s 34 largest refineries.

As of the end of June, around 90% of Russian regions have imposed some form of fuel rationing or reported supply issues, as refining capacity has plunged following damage to facilities. The strikes have deepened a nationwide gasoline shortage, with several major refineries shut down and the government banning almost all gasoline, jet fuel and diesel exports.

Russia is the world’s number two diesel exporter, after the US, according to Vortexa. Stronger Russian crude exports are also adding to global oil supplies, which is bearish for prices. Data compiled by Bloomberg show the four-week average of Russian crude exports rose to 4.

13 million bpd through June 28, the highest since Russia invaded Ukraine in 2022. Russia may be boosting its crude exports as the country’s refining capacity has plunged due to damage at its refining facilities from Ukraine drone and missile attacks.

The outlook for higher US crude output is negative for oil prices. The Department of Energy (DOE) on July 7 raised its US 2026 crude production estimate to 13.78 million bpd from a June estimate of 13.72 million bpd. As a bearish factor for crude, OPEC delegates said on May 14 that the cartel aims to continue a series of oil quota increases over the next few months, completing the return of halted oil production by the end of September.

The group already formally agreed to restore about two-thirds of the 1.65 million bpd supply cutback it made back in 2023 and said it plans to raise output targets further and to revive the final portion in three more monthly stages. On July 5, OPEC+ said it will boost its crude output by 188,000 bpd in August, though that increase might prove difficult due to revived US-Iran military attacks in the region.

OPEC’s June crude production rose by +2.34 million bpd to 18.75 million bpd. Vortexa reported on Monday that crude oil stored on tankers that have been stationary for at least 7 days rose +31% w/w to 90.03 million bbl in the week ended July 17. Wednesday’s weekly EIA report was mostly negative for crude oil and products.

EIA crude inventories unexpectedly rose +2.01 million bbl versus expectations of a -1.95 million bbl decline. Also, EIA gasoline supplies rose by +765,000 bbl versus expectations of a -1.9 million bbl decline. In addition, EIA distillate stockpiles rose by +1.

4 million bbl, a larger build than expectations of +825,000 bbl. On the positive side, crude supplies at Cushing, the delivery point for WTI futures, fell -624,000 bbl. Wednesday’s EIA report showed that (1) US crude oil inventories as of July 17 were -5.

3% below the seasonal 5-year average, (2) gasoline inventories were -7.1% below the seasonal 5-year average, and (3) distillate inventories were -9.6% below the 5-year seasonal average. US crude oil production in the week ending July 17 fell -0.5% w/w to 13.

798 million bpd, just below the record high of 13.862 million bpd posted in the week of November 7. Baker Hughes reported last Friday that the number of active US oil rigs in the week ended July 17 rose by +7 to a 13-month high of 452 rigs, up from the 4.

25-year low of 406 rigs posted in December 2025. However, the number of US oil rigs remains sharply below the 5.5-year high of 627 reported in December 2022. On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article.

All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

strikeUnverifiedUSIsraelIran
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TEL AVIV, July 23. /TASS/. The Israel Defense Forces (IDF) will deal "a crushing blow" to Iran, if it attacks the Jewish state, Defense Minister Israel Katz warned, according to the Ynet portal. "We are ready for any development of events. If Iran attacks Israel, we will deal a crushing blow," he said.

Earlier on Thursday, US President Donald Trump said that he was considering carrying out a massive attack on Iran, and the strikes would be harder than before. According to the American leader, Israel will "join the attack in two minutes" if requested by the United States.

However, he added that Washington "does not need anyone" to launch a new military operation. Trump did not specify a deadline for making a decision. The United States and Israel started a war with Iran on February 28. In June, Washington and Tehran signed a memorandum of understanding providing for an immediate cessation of hostilities on all fronts, including in Lebanon.

However, on the night of July 8, the United States resumed large-scale strikes against Iran, accusing it of violating the terms of the agreements regarding the Strait of Hormuz.

strikeUnverifiedUSIsraelIran
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The British government stated that it stands ready to defend itself following Iranian comments designating UK bases hosting US forces as legitimate targets in response to US military strikes on Iran. Iranian officials described the UK as an accomplice to US operations, while UK policy has allowed US use of bases such as RAF Fairford and Diego Garcia for what the UK has termed defensive purposes.

Permissions for this arrangement, first granted in March, were extended under the current UK government.

Location: Iran