00:0094.92. So 8 percent gains there. For more on Iran, for more on oil, we are joined by Ellen
00:06Wald.
00:07She is a senior fellow at the Atlantic Council. She's also the author of Saudi Inc.,
00:12the Arabian Kingdom's Pursuit of Profit and Power. And let me first get your take on the statements
00:18that we've heard from the deputy foreign minister just moments ago, Ellen, that they would not be
00:24laying mines, that they have not laid mines in the Strait of Hormuzin, that they are apparently
00:29letting some ships pass. Not clear which ships those are, but that's according to the deputy
00:35foreign minister. So I'd say if we are to take him at his word, it does make sense that the
00:42Iranians would not want to lay a slew of mines through the Strait of Hormuz because they still
00:46want their own ships to pass. From what we can tell from satellite imagery, the oil loadings that
00:54Harg Island and of Iranian oil have actually picked up recently. And so they want to make sure their
00:59own ships can get through unimpeded. And even if you're the ones laying the mines, it's a very narrow
01:05waterway and it could be very dangerous. So there could be some truth to what he's saying.
01:12In terms of that they're allowing some ships to pass, it does appear that some ships have flagged
01:19themselves as Chinese, whether that's kind of a lie or the truth. But some of them have gotten by.
01:26But on the other hand, we've seen other ships get hit with projectiles and are basically sitting
01:32there on fire and their crews had to be rescued by the Omani Navy. So it's really a matter of
01:38whether
01:39you want to risk it or not. And I think that the calculations for oil tankers versus the calculation
01:44for, say, a cargo ship or a container ship are quite different when it comes to the damage that
01:49a projectile could do.
01:51You know, earlier this week, Ben Emmons from Highline Asset Management did an excellent
01:56deep dive into the mine picture, saying that Iran has one of the biggest inventories of mines in the
02:02Middle East, possibly 5,000 mines from moored contact mines to influence mines to limpet mines,
02:09controlled remote controlled bottom mines. I mean, why have all those mines?
02:14If you're not going to use them there, especially after the supreme leader saw his mother and
02:21father, wife and son all killed in an American attack and reportedly is injured himself.
02:28So that's quite terrifying thinking about the number of mines that Iran has. But I think
02:33you kind of got to think about it in terms of in terms of a strategic approach. So if Iran
02:39mines
02:40the Strait of Hormuz like this, then, you know, they've got to be there. They are not really
02:44incentivized to do that unless they can't get any oil out. So if, for example, the US invades and takes
02:50over Khark Island or bombs all of Iran's oil infrastructure there, or if they are commandeering
02:57and embargoing Iranian ships that can't get to their destinations, that means Iran has no source of income,
03:03essentially. And that's at the point where I think they would say, hey, there's nothing left here.
03:07We've just got to, you know, go all out, take everything out. So there is a bit of strategy at
03:12play here. But the fact that they have these mines and that they're probably willing to do it definitely
03:18indicates that they are preparing for that kind of a situation and that there's certainly, you know,
03:24it definitely could occur, although we haven't seen that happen yet.
03:28But, Ellen, you think that the Iranians are still rationally thinking about their economic future
03:34and haven't reached the point of simply inflicting maximum damage on the US and Israel?
03:39I think once they reach the point where, say, the regime is about to topple, perhaps,
03:44but right now they still need money. They've got, you know, they've got to fund their continuing war
03:50effort and they've got to fund their own coffers. They've got to fund their military. They've got to
03:55fund their security forces. And the only way to do that is to keep selling oil. And so as long
04:00as their oil can get out, as long as they can get those funds, then they're not incentivized to
04:06kind of go in this path of destruction. It's almost like the idea of mutually assured destruction
04:10during the Cold War. Ellen, we've heard from so many experts about Russia being one of the sole
04:17beneficiaries of this war. Obviously, Vladimir Putin can charge more for his oil. And as we
04:25pull sanctions off of Moscow, he can more freely sell that oil. Do you think there's something to
04:33that? I mean, is the Russian war machine getting a much better financing surge now due to our attack
04:40of Iran? Absolutely. I mean, right now, first of all, the pressure is off of Putin because all the
04:47eyes are on Iran in that situation. So he's got a breather there. Then he can charge a lot more
04:53for his oil for two reasons. One, you know, he doesn't have much competition from Venezuela anymore.
04:59Plus, you know, there's a problem where a lot of oil is stuck in the Persian Gulf. So anyone who's
05:04not
05:05under sanction, you know, who's not concerned about sanctions being forced on them or having to pay
05:10that is going to be looking to see if they can get oil from Russia. I mean, now he's he's
05:15selling oil
05:16again to India. So he's also got an immense tanker fleet available to whereas other tankers are trapped
05:23in the Persian Gulf. And so he's he's definitely got a breather. He's definitely going to refill his
05:28his war coffers. And also strategically, you know, this is going to put the pressure on him. You know,
05:33we're we're seeing now this resolution to Russia, Ukraine much farther out of reach,
05:38given how long this Iran situation is taking. I'd also love to get your take on the potential
05:44suspension of the Jones Act, which seems like an insane piece of legislation. We can only ship
05:50oil between U.S. ports with American made ships, even though there aren't any American made ships.
05:56We don't have a shipbuilding industry here. How likely is this to drive down oil prices and how
06:05much oil are we actually exporting? I mean, President Trump pointed out today that we're
06:10making money, he said, because we're the largest producer of oil. But are we actually selling it to
06:14other people than ourselves? Well, well, that's a good question. So who's the we making money?
06:19Absolutely. All the domestic oil producers are making money because they
06:23are selling their oil at market rates. And that's one of the reasons why
06:27we don't actually import a whole lot of oil or products from the Persian Gulf. We have other
06:33sources that our biggest source of oil outside of our domestic oil industry is Canada. And there's
06:39no problem getting Canadian oil. So we're not really looking at potential shortages, but there are
06:45transportation issues. And the Jones Act could definitely help alleviate that. For example,
06:49some of the ways that Florida gets oil, a lot of it comes from barges. And if you relax the
06:57Jones Act or you suspend it, then there's more available ships to get that oil to where it needs
07:02to go. So I would say that it definitely helps with logistic issues, maybe getting more products
07:09around California, which could be a potential issue because they do and have actually imported some
07:14from the Persian Gulf. There are other laws and things that make that more difficult. But
07:19it's definitely helpful. I'm not sure it's going to really bring down prices because really what we're
07:25seeing is oil is a global commodity. And so even if we have plenty of oil and we're not facing
07:31gasoline shortages, we are subject to rising oil prices. And most of the cost of gasoline is
07:40the oil itself. And so I think it's helpful, but it's not the solution.
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