Iran starts Bitcoin-backed ship insurance for Hormuz strait
bloomberg.com235 points by srameshc 7 hours ago
235 points by srameshc 7 hours ago
https://finance.yahoo.com/markets/crypto/articles/iran-start...
Much of the post-WW2 American-led world order was founded partially on the United States using its military to keep international waters open. It would be quite stunning Iran defeated the united states in this sense. The military might is there, but this administration clearly had no idea what they were getting themselves into and did not plan accordingly. (and does not have the will or public support to do so) The baffling part of this is that nearly everyone was aware that Iran could close the straight if pressed hard enough. The fact that this outcome is surprising represents a very loud and public failure on the administration's part. I don't know enough about the current state of naval warfare but I've assumed this is related to the asymmetry that's emerged around protecting capital warships, especially in the scenario of a very narrow strait and a long enemy-controlled coastline. They can shoot relatively low-cost, short-range guided missiles from anywhere along the coast. Even if a warship stops the vast majority of them, only one has to get through to sink a multi-billion dollar ship that takes a decade to replace. There are now similar asymmetries emerging across war-fighting and even though warships can still be effective (and less vulnerable) in other scenarios, this specific one seems especially bad. The other factor is that most of what ships carry through the straight isn't going directly to the U.S. so the impact on the U.S. is mostly secondary, reducing the risk the U.S. is willing to take. Of course, all this was known beforehand by military strategists which makes this all look even worse for the U.S. administration. The bigger issue is the tankers. The US Navy isn't going to be happy patrolling the strait sure, but even if they did they wouldn't be able to protect the tankers enough for it to make sense for tankers to take the risk. The last time this happened the US opened the strait by accidentally shooting down an Iranian passenger plane after sinking a large chunk of Iranian navy. The Iranians assumed the US shoot the passenger plane down on intentionally as a war crime and assumed the US would was planning to escalate the conflict. This fear deterred further Iranian attacks on tankers. This isn't going to work this time because the US started the war by performing of the most serious escalations possible, a decapitation strike against top Iranian leadership in a surprise attack using a diplomatic negotiation as cover. The US did this while the strait was open and Iran was considering a peace deal. Threats of escalation are no longer effective at deterring Iran because Iran now believes the US will take such actions regardless of what Iran does. What does Iranian leadership have to lose by staying the course? Very little. On the other hand if Iranian leadership back down, they loose all their leverage, they look weak internally, they look weak externally and the US might decide to attack them out of the blue again. This is why decapitation strikes are generally not done. They remove options and they undermine deterrence and paint belligerents into a corner. I think "Iran was considering a peace deal" is a bit of a stretch here. Iran was stalling for time, not willing to give anything, and the Strait was indeed open. If they won't give anything now why should they have given anything before. What does Iran still have to lose? Well, a lot. All their oil is exported through the strait that is now blockaded by the US. The regime while having survived so far and executing thousands of people is still vulnerable over the long term. Leaders can still be hit and potentially the penetrations that led to the success of the initial strikes is still there. Iran's energy sector which is what the regime needs to maintain control (pay salaries etc.) has still not been hit. Other strategic targets that are dual use have also still not been hit. Iran is never going to capitulate, until it capitulates. Their rhetoric is going to remain that the US has no more levers and can't change anything, because admitting otherwise invites those levers to be engaged. There is some truth to certain individuals likely willing to pay a large price but it's far from clear how deep and wide that extends and what is the tipping point. It is possible that Iran can withstand an oil blockade and even a resumption of air strikes for a very long time but it's also possible they can't. I can't tell and I doubt many people can. There are analysts and various experts with all sorts of opinions. EDIT: Some of you may remember the Iraqi rhetoric before the US invasion. Then when the US attacked Iraq it crumbled like a paper tiger. The US lost 139 people or so (the coalition lost a bit more) to take Iraq and the Iraqi army largely surrendered or ran away. Assad's huge army with tanks and fighter jets, supported by Russia, collapsed from a bunch of ragtag ex-ISIS guys on Toyotas. The Iranian regime is a lot weaker than what you'd think by listening to them talk because any projection of weakness is the end of them. Ofcourse the US Iraqi invasion ended up very badly after this tactical success and that's the actual problem. Defeating Iran on the battlefield - not so much. > I think "Iran was considering a peace deal" is a bit of a stretch here. Iran was considering a peace deal. I agree that the most plausible was they would reject it. > What does Iran still have to lose? Well, a lot. The US could do this, sure, but then Iran would have even less to lose. This might work if the US started small and threatened escalation to try to compel Iran, but the US started at massive escalation so any additional airstrikes are likely to be less escalatory and thus less of a threat. Even worse, there is a fundamental problem with madman theory, if Iran believes they are dealing with a madman, then threats aren't effective because a mad man doesn't keep promises. If you think your opponent is not rational, then you should not expect them to follow cause and effect. > Iran is never going to capitulate, until it capitulates. Their rhetoric is going to remain that the US has no more levers and can't change anything, because admitting otherwise invites those levers to be engaged. I agree that we don't know exactly how much pressure is on Iran. Iran historically has been willing to suffer almost any cost. During the Iran Iraq war then sent enormous numbers of teenagers in human wave attacks over and over. It is my estimation that the current war with the US has helped to stabilize the Iranian government and that they benefit more from the war continuing than from a peace deal. The only military lever the US has left on the table is an invasion of Iran. Maybe limited to the coastline or maybe complete regime change. Trump has not even attempted to bluff that he is doing this. The Iran/Iraq war is why I made the edit about US vs. Iraq. Just because Iran and Iraq fought for years does not mean Iran or Iraq are able to fight a super power. They can not. Iran does not think they are dealing with a madman. I don't believe for a second that they think that if all the demands made of them are met someone will harm them just for the fun of it. The maximalists demands. The problem is those maximalists demands run against everything this regime stands for. Not that those demands are bad for the Iranian people, they're actually good. What is true (and it's not a question of madman theory) is that the US and Israel will absolutely take some concessions and be willing to delay dealing with the rest of the problems. That is not irrational. That is 100% rational. And ofcourse the Iranians knows this as well. What the US and Israel want is a stop to the proxy wars, a stop to long range missiles, a stop to the nuclear program and a stop to "exporting the revolution". No workarounds or funny business. I think the regime is very weak. Conditions in Iran are worse and a population that already wanted them gone now wants them even more gone. Their boisterous rhetoric is a sign of weakness that westerners misinterpret. The more they sound threatening and winning the more they are losing. On a much smaller scale, this is advice I give to just about everyone: If your decisions won't affect how they treat you, then just do what you want. The fact that they won't like it doesn't matter, they didn't like you before. > This is why decapitation strikes are generally not done. They remove options and they undermine deterrence and paint belligerents into a corner. You don't think autocrats have a strong incentive to not die? The dead leadership can't change their decisions anymore. And the new leadership has no reason to assume that considering a peace deal will keep them alive. The US has already shown that they are happy to break the deal, then a couple years alter kill you anyways. Staying the course at least keeps the internal threats down (which are just as capable of killing any autocrat) Modern US surface warships such as the DDG-52 Arleigh Burke class are pretty survivable. The Iranians (and their Houthi proxies) have made sustained attacks on them and don't seem to have hit anything. And a single hit would be highly unlikely to sink such as vessel: we're not talking about something like the Russian Moskva cruiser that was crewed by drunks and had inoperative defensive systems. The real problem is that there are too few such vessels to sustain convoy escort operations. Each destroyer can only provide area air defense for a handful of merchant vessels, and they can only stay on station for a few days at a time before they have to cycle out to refuel, rearm, and conduct critical maintenance. Some of the key munitions also appear to running low. And it appears that the other Gulf states are refusing to allow use of their facilities over fears of Iranian retaliation. Other countries generally aren't really in a position to assist as part of a coalition either. They either don't have sufficiently capable warships at all, or lack the logistics train to sustain them in the Persian Gulf / Gulf of Oman region. After the Cold War a lot of countries like the UK and Germany essentially dismantled their navies so that they now exist only as government jobs programs. Assisting the US with regard to Iran is phenomenally unpopular. The increase in energy prices isn't outweighing people's desire not to have their country assist. The other thing is: even if a country like the UK committed billions of dollars to joining the fight in the gulf - there’s no reason to think it’d lower their energy prices, or earn them any favours from Trump. Short of a nuclear strike (which isn’t on the cards thankfully) nothing short of a ceasefire can get shipping moving again. Sending more warships doesn’t help with that. So it’s not just that helping Trump would be incredibly unpopular at home - there’s also no guarantee the huge expense would lower energy bills at all. Many countries have said they will help patrol the strait as long as the war stops. Iran wont be able to keep this after the war. Iran wont declare war against the entire world, so they wont shoot down their destroyers. The attack on Iran was an attack on the globe, causing energy and supply chain issues for everybody, including the attackers. Other countries are not volunteering to help prosecute more attacks on Iran, because they are already victims of those attacks, and it's bad enough that the USA and israel aren't even apologizing for hurting them, much less paying for the damages. Thus, the offer to "help patrol the strait" once the USA and israel stop attacking is meant to persuade the USA and israel to stop attacking, not an indication of support for the USA and israel's attacks. Indeed, most countries do not support the USA and israel's attacks on Iran, were totally okay with the status quo, and would have preferred if the USA and israel had not attacked Iran. So what? Attacking Iran was a stupid move, but the US and Israeli regimes don't particularly care about the other victims whining. If other countries are going to make themselves dependent on fossil fuels from the Persian Gulf region then they'll either have to secure their own sea lines of communication or accept that supplies are unreliable. Asking for apologies or payments won't accomplish anything. That is the geopolitical reality. There are refeniries dependent on the Persian Gulf region(PGR) but the majority of countries are dependent on the the general commodities market of downstream products. The US famously produces more oil than it uses and is not generally receiving fuel that's downstream of the PGR and yet if you look at the gas prices in the US you'll realise that it's not as simple as being reliant on fossil fuels from the PGR. That's without taking into account other things like high grade helium or specific niche products. > the US and Israeli regimes don't particularly care about the other victims whining This does seem to be true of israel, but as for the USA, it does not, hence the USA limiting their attacks. > If other countries are going to make themselves dependent on fossil fuels from the Persian Gulf region then they'll either have to secure their own sea lines of communication or accept that supplies are unreliable. This sort of rhetoric is why other countries do not support the USA and israel: the other countries already did that, then the USA and israel came and attacked those supply lines, thus attacking those countries. It strikes me as gaslighting abuser language to attack someone else, then blame it on them for not protecting themselves better. It's better for the attackers to acknowledge their mistakes, apologize for them, and pay restitution. And yet national leaders do phenomenally unpopular things all the time when they decide it's necessary. In this particular case it's mostly moot because none of the other impacted countries really has the capability to act regardless of popularity or lack thereof. Like the UK chose to spend all of their money on nationalized healthcare instead of the military. I don't mean that in a critical or negative way, on balance that might have been the right choice for them. But that choice does constrain their options in a crisis. The UK spends a lower fraction of its GDP on health than the US (the US is an outlier because of its system). The UK's NHS is not why it's not taking part in this mess. Would it not be pretty counterproductive for other countries to assist the US in this case? That seems only likely to prolong / exacerbate the war. The US giving up would be much faster. Whether it would be counterproductive or not depends on what those other countries are trying to produce. None of them particularly want to pay tribute or protection money to Iran, especially because Iran could then decide to close the strait again or raise the fee at any time. They also don't want to set a precedent that other countries might exploit for charging transit fees through their national waters. And the USA might impose secondary sanctions on any country which makes payments to Iran. So the current stalemate might last quite a while. "Like the UK chose to spend all of their money on nationalized healthcare instead of the military" I believe the equation is a bit more complex than that. I don't know anything about this but I am a software engineer. Stop laughing for a minute because I do have a point. As a software engineer, I typically build something and engineer it so I can iterate quickly and improve it. I know that the first version won't work. Isn't this a perfect opportunity for Iran to iterate on sinking cargo ships? I'm struggling to believe that a regime that is (allegedly) weeks away from a nuclear bomb wouldn't be able to keep launching missiles at ships until they notice the right type of hole. And, think of the apprenticeship opportunities. Iran doesn't want to sink merchant ships. They want to extort money from merchant shipping companies by threatening to sink their ships if they don't pay for 'protection'. All they need is a credible threat, which they already have absent any naval ships willing to stay at point blank range to defend merchant ships. While there are religious, cultural and political aspects to this, the Iranian govt has primarily become a kleptocracy in recent years. It sustains power through the Revolutionary Guard (aka IRGC) which has grown into what's essentially a state-run, money-making commercial enterprise. It collaborates and colludes with various entities across the Iranian economy which it controls either directly or via bribes and coercion. While reasonable people can debate what the recent attacks on Iran accomplished, they certainly nerfed a large part of the IRGC's income. The new Hormuz extortion scheme isn't just retaliation or vengeance, it's replacing lost income which is urgently needed to prop up the Iranian government. Yes, Iran has already hit several merchant vessels. Their ability to do that occasionally is not in doubt. It's mostly a question of economics. The ship owners and insurers have to decide whether it's worth the risk to run their cargoes through. This has all happened before with the 1980s "Tanker War" between Iraq and Iran: despite some losses the traffic never completely stopped. And large merchant ships, especially crude oil tankers, and quite tough to sink. When they take a hit it usually just causes some damage. Iterating on a rocket design is not like making a tweak to a line of code. It needs production line changes, manufacturing, testing, (repeat X times) where the process takes weeks, months or even years untill desired results can be achieved. And their manudacturing sites have been reduced to rubble, so that slows things down too. As I said I'm only a software engineer but didn't Ukraine revolutionize the rules of asymetric warfare by drone iteration? Your statement rings true but I wonder if there are aspiring rocket engineers that really want to test their totally unproven new ideas without the constraint of a military hierarchy in peacetime. The thing is, Iran doesn’t need to. US maybe can defend their ships, but they can’t defend commercial ships well enough for them to resume regular operations. Even unsuccessful attacks would cause insurance to make it not possible. Houthis closed their straight some years ago and US wasn’t able to do anything about that neither. And Houthis are nowhere near as capable as Iran. US gambled on decapitation strike and failed. Yes, that is a fair point. However, the cost of drone versus latest generation ballistic missile that has a chance to reach us naval ship is very different. And in that sense, iterating on a drone is closer to iterating on a line of code because one drone would cost you a thousand bucks and your iteration is a small tweak like adding a different grenade triggering mechanism. Rockets require custom design, custom manufacturing lines, and generally much more difficult to modify and make more effective. You also have a lot more tries with cheap drones since the target is lower value, so you have hundreds of data points on how each iteration performs vs hitting a naval ship which is an extremely rare event, so it's hard to see whether your iteration on a rocket actually succeeded. Is it even worth to escort tankers? The money you spend on countering cheap drones would be massive, and this administration would likely ask the escorted ships to pay for protection. At that point, they might as well just pay Iran. The rub is the insurance for the tankers. The providers are looking at the risk and saying “hard pass.” Unless the US govt wants to get in the tanker insurance business they are stuck. The US government is already in the shipping insurance business. That hasn't helped. War risk insurance is also still available from other carriers. https://www.insurancebusinessmag.com/us/news/breaking-news/w... The Iranians (and their Houthi proxies) have made sustained attacks on them and don't seem to have hit anything. That's because the US has kept the surface combatants far back from the Persian Gulf for the duration of the war. As far as we know, they have attempted to run the strait twice and had to turn back because they were under sustained attack. I assume these ships can defend themselves for some period of time, but eventually the munitions run out, and they become sitting ducks. There is a reason the US Navy fled the Persian Gulf on Feb 26 and has not returned since. > There is a reason the US Navy fled the Persian Gulf on Feb 26 and has not returned since. Two US Arleigh Burke Class Destroyers transited Hormuz a couple of weeks ago without damage and are still there last I heard. The Iranians were really upset, but couldn't do anything to stop it. https://www.cbsnews.com/news/2-us-navy-destroyers-transit-st... Do you have supporting evidence they are still there? I though they exited toward the Gulf of Oman around May 6/7 https://www.centcom.mil/MEDIA/PRESS-RELEASES/Press-Release-V... I had not heard about that transit, thanks for sharing! The ships mentioned in our two links match up, so it certainly sounds like they spent a some number days in the Persian Gulf and transited back. There was also a transit that occurred in April which mentioned other ships joining the operation in the future, not sure if that happened or not. If it went so swimmingly, why only twice then, when there are thousands of marooned ships in need of escort services? Transiting by themselves is a lot different than escorting merchant vessels. By themselves warships are free to maneuver at any time and do so at military speeds. Convoy duty with merchant vessels requires repeatedly moving slowly along a predictable route for sustained periods. Mobility and speed are two of a warship's main strengths. The extreme narrowness of the straight right next to so much enemy-controlled shoreline is a unique problem. All of the destroyers and frigates from all the world's navies combined couldn't sustain protecting the massive number of merchant vessels wishing to transit the Straight of Hormuz on a daily basis. Ships don’t need escort services because you don’t give command of oil tankers to risk taking thrill seekers. And insurance isn’t enough when the captain is literally on the ship, potentially getting killed. Ships need a robust, sustained ceasefire. Warships vs. insurers willing to underwrite a policy for merchant vessels to transit are definitely two very different things. The Iranian Government has a much higher pain threshold/resolve than Trump, but they're also in a lot more pain with the Gulf of Oman closed. Both sides are losing, who will get tired of it first? > I don't know enough about the current state of naval warfare but I've assumed this is related to the asymmetry that's emerged around protecting capital warships, especially in the scenario of a very narrow strait and a long enemy-controlled coastline. It's not the billion-dollar warships that transport oil, it's the much more fragile and unarmed tankers. Even if the US Navy begins full escort duty, it can't remain on-station forever. What are shippers to do afterwards? One drone strike might cause a tanker to have a very bad day, yet it's extremely difficult to so permanently degrade an entire country that they become incapable of launching sporadic attacks. Ultimately, the status of the Strait must be settled diplomatically, and the US and Iran are each betting that the other side will blink first. It's not even the strait that's the important geopolitical entity here. It's all the oil pumps and refineries in Saudi Arabia, Qatar or UAE. The US began to patrol the strait with Destroyers and immediately stopped when the scared Saudis immediately realized that Iran was about to attack Saudi oil rigs. -------- Iran has too many targets and the only thing that can stop them is the equivalent to an Israeli Iron Dome across the entirety of the Middle East, Saudi Arabia, Qatar and UAE, maybe more. > Iran has too many targets and the only thing that can stop them is the equivalent to an Israeli Iron Dome across the entirety of the Middle East, Saudi Arabia, Qatar and UAE, maybe more. Another key issue is Iran's regional neighbors haven't invested significantly enough becoming credible military threats against Iran. Instead they tried to play an in-between game of being tacit frenemies because Iran and its proxies could be politically useful. But in the last 3 years, Iran lost most of its proxies through a series of catastrophic miscalculations, dramatically shifting regional dynamics. Iran now has less reason to cooperate regionally and its neighbors lack of credible offense is costing them dearly. A contributing factor is that the direct customers for much of what passes through the strait are Western European countries who've failed to sustain any real naval power beyond ceremonial presence. In recent years, the U.S. Navy had to quietly ask the German navy to stay away from the Western Indian ocean due to the additional burden of guaranteeing the safety of the German "warships" if they were attacked by Somali pirates. > Iran has too many targets and the only thing that can stop them is the equivalent to an Israeli Iron Dome Wasn't Iron Dome coverage deteriorating due to low munitions? The cost asymmetry between drones and interceptors makes any drawn-out conflicts mutually punishing - unless someone on the future decides to gamble on another decapitation strike. The Iron Dome is great against improvised pipe-rockets, but less effective against ballistic missile salvos. I think this is not discussed enough. These are huge investments and destroying them requires a significant time to recover. Our key growth play being AI which is a huge energy consumer, impacting the long term supply chain for energy is questionable. Cheap drones taking out an AWACS is a great example of this. The US has only 16 of these and it will cost $700 million to replace, and was taken out by a drone that probably cost less than your car. All of this was well known before the war though. The idea that navy is incredibly vulnerable modern anti-ship defenses has been a major consideration in the Taiwan situation for at least a decade (mostly in relation to the ability of the US navy to even operate in the area in a war). More recently, Ukraine has made a great show of sinking navy ships with cheap unmanned surface vehicles Back in WWII you could sail your navy up a river and expect positive results. In the 21st century, the idea of attacking an enemy-held strait with navy doesn't work The US military is also just less powerful than it was at its peak at the end of the Cold War as well. Still the most powerful navy in the world, but spread increasingly thin (turns out "the whole world" is quite a big place). This is no longer Reagan's (almost) 600 ship navy, and projecting power halfway round the world is no mean feat when your opponent can lob missiles and drones at you from their back garden I don't see how more more American war ships in the strait would change the calculus of the Iran war without. Even if they packed the strait with ships so that an admiral could walk from Oman to Iran without getting their shoes wet, Iran could still lob drones and missiles from inland. suppose one has N independently developed interception systems (from detection till physical interception attempt), each with an intercept success rate of 90%. a rudimentary calculation then gives the probability of hitting (not sinking) the ship as 0.1^N per launched missile; so it seems that given enough budget to spend on independently developed missile interception systems allows to drive down the penetration success rate arbitrarily. Multi-billion sounds like $ 10^10; so assuming an attacker can launch say a million missile attempts then the statistical loss would be 0.1^N * 10^10 * 10^6; so the statistical loss can be driven down arbitrarily say to $ 1 by developing ~ 16 independent interception systems. 16 independently developed intercept systems doesn't sound like unobtainium for a vested nuclear power. furthermore, the development cost of 16 independent intercept systems can be amortized over many more installations than a single ship, it can be amortized over multiple ships, multiple bases, multiple strategic assets across the globe. You have abstracted things a bit too far. Unless your interceptor system is unobtainium laser system with unobtainium cooling system, backed-up by unobtainium power source, you are going to run out of interceptor missiles (or even Phalanx bullets) way sooner than 'million missile attempts'. Quite possibly 100-200 Shaheds + half a dozen proper anti-ship missiles will cause you to turn tail. equally unobtainium as the 1 M missiles aimed at the ship. Is it? Russia’s making 60k Shaheds a year, and they are in the middle of an active conflict that has other needs. > Even if a warship stops the vast majority of them, only one has to get through to sink a multi-billion dollar ship that takes a decade to replace. Even worse. They don't need to attack _warships_. They can just attack civilian vessels, especially tanker ships, that don't have any defenses. A hit on a tanker and the subsequent oil spill would be catastrophic. American navy has blockaded countries all over the world, so it's more true that they closed international waters. Waters were open before America existed. If Americans would actually learn their history they would see that the USA blockade was the reason Japan attacked Pearl Harbour, as the Japanese needed the water to open and thought taking out Pearl Harbour would prevent the US Navy controlling the Pacific. Japan attacked the American base, USA attacked Japanese civilians with nukes. > Waters were open before America existed. A huge part of the reason sovereign nations built navies was to fight piracy. It’s not really true that waters were open historically. Are you saying there are no pirates now? US navy has solved all the world's problems? The blockades have killed millions of people, even in the last 30 years. When US sanctioned Iraq after the first war, they killed 500k people every year, and then US invaded Iraq on lies. The world would be safer without the US Navy. Nukes were not a response to Pearl Harbor. The framing in general of “Japan only took military action and the US sank to attacking civilians” is wrong too. Take a look at what Japan did to the Chinese during that time period if you think they were only attacking military targets. Japan also invaded an Alaskan island. https://prologue.blogs.archives.gov/2010/06/07/the-japanese-... Are you saying USA cared about the Chinese? Japan had already surrendered before US nuked them No, Japan had not surrendered before the bombs. There is no evidence of that in Japanese or western history. Where are you getting that from? > Are you saying USA cared about the Chinese? I’m saying it was not beneath Japan to commit horrific atrocities on civilians. You can’t pretend they were some high moral actor that was only performing a military action to defend themselves. Did I say the Japanese were good guys?
Everything the Japanese did, UK, USA and other European countries have done worse. They're still doing it. Going back to the original reply, US Navy only benefited the US by screwing over the rest of the world "Waters were open before America existed." The United States formed our Navy because of Islamic Pirate/Slavers causing a lack of open waters. https://en.wikipedia.org/wiki/Barbary_corsairs "The Barbary threat led directly to the United States founding the United States Navy in March 1794." US navy literally doing piracy right now taking ships in international waters, destroying boats in Venezuela and Trump admitting to piracy. Why would you post such nonsense given how easy it is these days to determine bullshit? By the time of Pearl Harbor, Japan was formally aligned with Nazi Germany. Japan, Germany, and Italy signed the Tripartite Pact in Sept 1940 creating the Axis alliance. Pearl Harbor happened in Dec 1941, so Japan had been formally tied to Germany for more than a year. “The American navy closed international waters.”
Not in the Pearl Harbor context. Before Pearl Harbor the U.S. was not conducting a naval blockade of Japan that closed international waters. The U.S. cut off Japan from US oil in July 1941. That is not the same thing as the U.S. Navy closing the Pacific. “The USA blockade was the reason Japan attacked Pearl Harbor.”
False. Japan attacked Pearl Harbor because it wanted to neutralize the U.S. Pacific Fleet while Japan seized the "Southern Resource Area”, especially oil-rich East Indies, Malaya and other regions in the pacific. The U.S. oil embargo might have played a small factor, but that wasn't a US-only thing; various countries were increasingly unwilling to sell oil and other resources to Nazi-aligned Japan while they were attempting to conquer China and most of the Southeast Pacific. Japan didn't have any problems with USA because USA was not part of allied forces. In fact USA sold weapons to both UK and Germans. USA only joined after Pearl Harbour. Japan attacked because US Navy prevented oil being shipped to Japan, Japan had no other source. > United States using its military to keep international waters open Being a little pedantic, as per my knowledge, the Strait of Hormuz is not “international waters”. It’s territorial waters belonging to Iran and Oman. AFAIK, Iran hasn’t ratified UNCLOS either, and claims it is not subject to it. > It’s territorial waters belonging to Iran and Oman. The trick is that it's still an 'international strait', or a segment of water that forms the only connection between two areas of high seas -- in this case the Persian Gulf and the Gulf of Oman. The principle of freedom of navigation establishes that innocent traffic (civilian traffic, and even warships in peacetime) have a right to use the strait to go from one body of international water to the other. Iran may claim that it doesn't have to abide by that right, but international law is never self-executing. One question to be resolved by this war is whether Iran will ultimately recognize the right to navigation in any settlement (and then choose to abide by said settlement). As the nation that was attacked first, They have an unimpeachable argument for wanting to defend the rest of their territorial waters. The ludicrously escalatory rhetoric from the US President has turned this into an existential conflict. I can't take finger-wagging against Iran seriously to be honest, the idea that western powers would scrupulously adhere to international mores if subjected to a full-on kinetic attack by another nation state is absurd on its face. One can argue that they have a "good reason" for ignoring international rules, but I would voice a risk here. Other nations that control important straits are watching what is happening and many of them could benefit more by taxing their straits than allowing free passage, and as more do it, the benefit only increase. It is a kind of prisoner dilemma in that defecting becomes the best strategy as soon anyone else start defecting. As with other recent trade wars, the value of this kind of behavior goes down when other nations start to retaliate. A ship might be able to pay the insurance from Iran, but can they afford to pay the same fee for each time they pass some other nations territorial waters? At some point the US blockade won't matter and the profitability of the venture will be zero. > They have an unimpeachable argument for wanting to defend the rest of their territorial waters They are shooting down neutral tankers outside of their territorial water, so stop with the bullshit. If they only shot ships in their own waters traffic in Hormuz would already have returned to normal. > the idea that western powers would scrupulously adhere to international mores if subjected to a full-on kinetic attack by another nation state is absurd on its face. We know they are, we have Ukraine as an example they don't start attacking neutral nations civilian vessels just because Russia attacked them. Only evil regimes do that, you don't "defend yourself" by committing terrorism against innocent neutral country ships that aren't shipping anything related to the country you are fighting. There is no reason at all for Iran to start shooting ad Indian ships just because USA attacked Iran, no western nation would defend themselves that way, many western nations has been attacked and conquered in history so we know how they act. International Law now has no value when the America-Israel alliance has been skirting said laws to commit mass atrocities in recent history. > The principle of freedom of navigation establishes that innocent traffic "freedom of navigation" seems to be from UNCLUS no? So why should a country (Iran) that didn't ratify UNCLUS care about the terms it binds it's signatories to? International law isn’t worth the time someone spent to write the words. It means approximately nothing. OPEC is a cartel, for example. If Iran doesn't want to observe the terms of the UNCLOS (regardless of whether they have ratified it or not) then their territorial waters claims revert to the older 3NM limit. They can't have it both ways. Of course, in practice those legalisms don't matter without a means of enforcement. > Iran hasn’t ratified UNCLOS either, and claims it is not subject to it. Which isn't unique. Bunch of countries haven't ratified it and aren't legally bound by it but do follow it in spirit. US, Turkey, UAE, Israel etc. Do you really think the US wouldn't abandon it in a heartbeat if it became a matter of strategic necessity? Countries that haven't signed do violate it. Israel prevents ships free transit to the Gaza strip. US does naval blockades and blows up boats. Naval blockades of enemy ports during war are legal, that is what USA and Israel argue they are doing. That is not what Iran is doing, they are blocking fully neutral ships from going in other countries waterways. US at war? We are past the 60 days for a military operation. From US law perspective, it’s illegal. From the constitutional perspective only congress can declare war which they haven’t. It's prohibited under international law to attack a sovereign nation, like the US has done to Iran, so the point of Iran closing the Strait in response to this is very much moot. All straits other than the Bosporus (which has some additional rights to Turkey given the proximity to a major city) are international waters for the purposes of free transit, under the Montreux Convention. The Montreux Convention only covers the Bosporus and Dardanelles straits. Not all straits in the world. Why is US blocking hormuz straits then? The US is is not blocking the Strait of Hormuz. There don't appear to be any US warships even in the Strait at the moment. What the US is doing is enforcing a partial blockade against Iran, largely in waters southeast of the Strait. We can argue about whether this is a good policy but let's not make things up. https://www.centcom.mil/MEDIA/PRESS-RELEASES/Press-Release-V... No, the Strait is international waters and always have been. Wikipedia says it's been Iranian/Omani territorial waters for quite a while: > In 1959, Iran altered the legal status of the strait by expanding its territorial sea to 12 nmi (22 km) and declaring it would recognize only transit by innocent passage through the newly expanded area. In 1972, Oman also expanded its territorial sea to 12 nmi (22 km) by decree. Thus, by 1972, the Strait of Hormuz was completely "closed" by the combined territorial waters of Iran and Oman. The Strait may well have some, but the traffic separation scheme for shipping is absolutely in Omani territorial waters, and another part of traversing the Strait includes passing through Iranian territorial waters. Ok, so just de facto iranian. However, I believe Oman also collects fees. So in practice the distinction wrt shipping is moot Oman doesn't collect fees... > Ok, so just de facto iranian. No, the route is entirely outside of Iranian waters. They attacked ships that were in Oman waters and put mines in Oman waters and now shoot at anyone trying to removing those mines in Oman waters. Nobody, not even the Iranian government, claims that is their water. You're not wrong, except that USA is/was not always literally "keeping waters open" for everyone. The Cuba blockade, which is another form of war and has dire consequences for the population, has been going on for decades: https://en.wikipedia.org/wiki/United_States_embargo_against_... This is factually incorrect. Blockade is not a synonym of embargo. Blockade is generally an act of war, and embargo is not. Dealing with Cuba is certainly a huge PITA for the majority of trading actors because of potential blacklisting in the US, but waters around Cuba are as open as they can be, and you can check marine traffic to make sure that ships arrive to Cuban ports. Even from the US itself (cause there are exceptions from embargo such as food, and medicines). The power wasn't there in the first place if the administration couldn't defend Hormuz. It's all the same capital and resources that prior administrations had. The actual blunder was exposing that weakness to the world. We could have done nothing and reputation would've carried the idea that we could. > The actual blunder was exposing that weakness to the world. The world already knew. The real strength of the prior admins was in simply not needing the military force. The 2015 Iran nuclear deal is a relevant example here. It didn't cost the US anything. It did, however, allow the Khomeini regime to murder its own citizens with impunity. So someone paid. That same regime is still allowed to murder its own citizens, now more so than before. The US attacks have only made the regime stronger. > The US attacks have only made the regime stronger. This claim is not supported by evidence. The "best" we can say about the regime is that it persists. So far. Not necessarily. It's a matter of risk. How many resources do we want to commit? Are we comfortable putting a large number of troops in Iran? Are we comfortable with major losses as we try to enforce against drones and mines? It's not that I think any of these things are wise, but this is part of the risk calculus you make when you decide to wage war. It's more like a debate: if you don't have a plan for uncomfortable questions you're a poor debater. The US has the physical means to prevent the closure, but I think it's quite clear that this administration ignored known risks and acted recklessly. And more importantly, apparently had very little contingency planning if things didn't go their way. > It's all the same capital and resources that prior administrations had. Is it? Depending on how far back into "prior administrations" you go, the modern US Navy is a shadow of itself. This leads to an interesting thought experiment. Using conventional weapons only, what prior year's US Navy could beat the 2026 US Navy in combat? That doesn't seem like the relevant question. A navy barely progressing as the technology progresses by leaps and bounds is just as problematic when you're measuring its strength compared to its adversaries. It's both a shadow of it's former self, as well as being optimized for force projection vs. freedom of navigation/securing free trade. It's probably even more powerful than peak cold war/WWII US Navy at force projection while adjusting for technology and adversary capability. Cruise missiles, much more capable aircraft, larger carriers, etc. At securing the high seas or forcing open trade routes? Just the sheer loss in number of deployable warships available to surge into an area is nowhere comparable. That and logistical capability is nearly nonexistent and relies mostly on nearby basing vs. tankering/supply ships. Not to mention a much larger Merchant Marine they used to be able to fall back on. There simply is not the ability for sustained operations at sea at any scale any longer, even if you had unlimited munitions to expend. You can certainly float a couple aircraft carriers 700 miles off some coast and keep them on station more or less indefinitely as you rotate them out, but that's really about it. And that's really the only sort of war the US Navy has had to fight for the past 30+ years. Separate discussion. I'm addressing the comment that the US Navy of today is a shadow of its former self. No, the same discussion. It's fair to say the British navy is a shadow of the former British navy that more or less conquered the world. It's also obvious the current one with an aircraft carrier would beat the former one with wooden ships and cannons. The same applies to the US navy even when the difference is the quality and quantity of integrated circuits and not the difference between a telescope and radar. You're not making a cogent argument. From most perspectives (civilian, political, financial), the "better" military is the one that wins. Your'e arguing that a navy can be a shadow of its former glory and still also be what is understood as "better" by most people. This doesn't make sense. phil21 makes a relevant point that navies are used for different purposes, and the current US Navy is tuned for a different task than that which it currently faces in the Gulf. The power is there, they just don't want to pay the cost in terms of money, lives, and polling popularity. This was done on the whim of a man-child throwing a tantrum, backed by his deeply racist hatred towards Obama. There was no plan other than his usual bullying tactics. Don't get me wrong, I'm glad we are not investing insane amounts of money and large lives into this, but we absolutely could win this if we wanted to pay the cost. the US probably trains the best experts in military history & strategy. At their officer schools like WestPoint & other programs. problem is when your Commander in Chief is a Idiot In Chief who wants to surround himself with "YES" men. actual solid pragmatic advice won't be listened to - i.e that Iran is a millennial empire with asymmetrical advantages. if you have no strategy to counter that asymmetrical strategy - then don't fight the war. > It would be quite stunning Iran defeated the united states in this sense. > The fact that this outcome is surprising represents a very loud and public failure on the administration's part. You can't teach stupid!! The coward, sleepy, dementia ridden, pretentious commander-in-chief declared victory over Iran the next day after starting the war. I would amend that to be that everyone thought Iran could close the straight, but now they _know_ they can close the straight. Seems like piracy is more about the land than the sea. I can't think of any major american military action against piracy aside from actions against somali terrorists. Seems piracy as it was known historically died out as the old historic pirate havens of say Tortuga or Outer Banks went from places of anarchy to places that were controlled by some government in some capacity. And that is exactly where we see the somali piracy today: here is a state that is unable to govern its land mass and thus there is piracy, even with the american navy directly taking action against this piracy. Seemingly this has nothing to do with the american navy at all, even though that is supposedly one of its mandates and it takes actions in the spirit of advancing these anti piracy goals. The fundamentals of why piracy does and doesn't occur don't really change. It seems it comes down to government capacity on land, not from projecting naval power. > somali terrorists Pirates are many things, maybe even criminals under international law, but terrorists they are certainly not. > maybe even criminals under international law Piracy has to be the canonical example of criminals under international law... Are they not commingled with Al Shabaab, Daesh, and the Houthis? By that standard, pretty much every nation state in the world would be considered terrorist. I'm not against that definition, but i'm rather sure you didn't mean it. Sir do you just think all muslims are the same people? What else ties these groups together? No? I'm talking about who is sponsoring the somali pirates. I'm not connecting them to these groups. They are already connected to these groups in particular. I didn't just name three random terrorist organizations. These groups are all operating in somalia right now. I'm not sure the extent to which either Daesh or Andar Allah are formally operating in Somalia, but I apologize if I cast unfair aspersions. I don't believe there are any formal or uniform or centralized funding of the pirates at all, though—many were simply fisherman who could no longer make a living. This is just my understanding however. I'm also open to the idea that the pirates aren't just from Somalia. The level of ordinance is enough evidence that there is significant outside support. RPG-7s do not grow on trees in Somalia. I hazard to guess an RPG on the black market is also a great expense to anyone who isn't being given one by one of these groups connected to the arms trade in effort to advance their goals or position in some way. They cost under $500/launcher: https://nationalinterest.org/blog/buzz/one-for-history-books... $300/launcher here: https://www.un.org/depts/los/nippon/unnff_programme_home/fel... A decade ago it wasn't terrorist groups funding them.
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