“It’s the first thing I read every morning.” — Annie Lamont, co-founder of Oak HC/FT, a leading venture capital firm.
1. The Wall Street Journal:
When the U.S. launched its campaign against Iran six months ago, Defense Secretary Pete Hegseth promised a quick, decisive blow that would avoid a long entanglement. Now, he is quietly extending troop deployments in a sign that the conflict could drag well into next year, according to people familiar with the matter.
The Pentagon’s all-in approach comes as Trump has sent mixed signals on what might happen next. Trump has embraced an economic pressure campaign in recent weeks in the hopes of forcing Iran to the negotiating table. Tehran has shown no sign of backing down, however, and the U.S. and Iran continue to exchange fire as both nations assert control over the Strait of Hormuz.
Privately, Trump is having discussions with senior aides about whether to declare the Iran war over, U.S. officials said, noting Trump has said he favors the idea. Trump also tells aides that he believes sticking with economic pressure will eventually force the regime either to dismantle its nuclear program or collapse, they said.
“I like our position now much better, with almost total control of the Hormuz Strait, and their economy totally collapsing,” he wrote on social media. “They are just playing out the inevitable. When are the Iranian people going to rise up and fight?” (Source: wsj.com. Italics mine.)
2. Iranian attacks have upended the Navy’s supply chain in the Middle East, causing a strain on the aircraft carriers, destroyers and amphibious ships that are being kept in the region indefinitely. The Navy has operated there for decades and built supply depots throughout the region. But Iran destroyed a critical Navy logistics base in Bahrain on Feb. 28, the first day of the war, and other ports in the region that can accommodate an aircraft carrier or a supply ship are also within range of Iranian missiles and drones, making them inaccessible. Navy supply ships in the region now have to travel 2,200 miles to a tiny island in the Indian Ocean called Diego Garcia to bring food, fuel and other goods to the warships in the Gulf of Oman and the Arabian Sea. The next option is to go to Singapore, 3,700 miles away — which requires the ships to pass through the Strait of Malacca, a busy commercial corridor. (Source: nytimes.com)
3. Last week, the Trump administration unveiled what it billed as an “Economic D-Day” aimed at forcing Iran to reopen the Strait of Hormuz and return to the negotiating table. But the experience of Western sanctions and economic pressure on autocracies such as Cuba, North Korea, Venezuela and Syria shows the challenges facing Washington in trying to bend Tehran to its will. Indeed, the strongmen ruling such countries have historically used a mix of violence, economic adaptation and political suppression that enables them to withstand economic pain for years, if not decades. (Source: wsj.com)
4. Europe has put off buying natural gas for the winter in a big, potentially risky bet that the Iran war will be over soon and prices will drop. The European Union’s gas storage facilities are only 65% full, their lowest level toward the end of summer in at least 15 years. Companies have been reluctant to buy gas for storage because they anticipated that Qatar, the world’s second-largest exporter of liquefied natural gas, would be able to resume normal shipments through the Strait of Hormuz this year once the conflict dies down. Now, prospects for a clear end to the war before winter are fading, driving up LNG prices to a 3½-year high this week. European buyers are being forced to accept more expensive natural gas as the Continent’s winter heating season approaches, when gas demand peaks. They are bidding against each other and Asian buyers who are now aggressively locking up supplies. (Source: wsj.com)
