How Iran is making a mint from the current war
economist.com
economist.com
The US is a major oil and has producer. It's benefiting from this war of aggression and not even taking any damage.
Oil companies and arms manufacturers are having a bonanza.
After the violence wracked 20th century I was hopeful the 21st century would be a bit more enlightened ...
Renewables already surpass fossil fuel in the energy mix [0], this will only accelerate the shift to energy independence.
It's countries that actively resisted diversifying their energy mix like the US that will feel the long term pain.
[0] https://www.theguardian.com/environment/2026/jan/22/wind-and...
The answer is to strike a deal with China. Unfortunately, that requires compromising on some values.
> countries that actively resisted diversifying their energy mix
Rhetoric aside, America continues to add renewable capacity [1].
The US has been trying to sell out Europe to Russians in a misguided quest to win them over against the Chinese.
The only reasonable reaction is a Metternichian rebalancing of powers.
It's rational, but it comes at costs. (And with costs.) China would have to put a stop to Putin's revanchism. Otherwise, Europe is just financing its burial and subjugation. And the EU would have to sign off on China's human-right records, and, in all likelihood, Taiwan policy. That, in turn, sets up a clash with the rest of Asia.
US citizens are loosers as well since cost of oil increased for them as well. This will also have inflation impact on other products from them as well on top of previous tariffs.
Oil companies are benefiting, everything else in the US suffers. Money isn't going to trickle out of these oil companies to spur economic activity.
Nations that benefit from the war do so because of nationalized oil production. Any nation without that is going to ultimately suffer because that added oil revenue doesn't make it's way back to the public.
All nations are going to look at increased food costs and potentially even shortages next year due to increased fertilizer and transport costs.
We aren't at the end of the inflation, though, that's going to hit. This is only the beginning. Next year will be when things really go south. At this point it's not a question of if, but rather how bad.
Europe and Asia have been royally screwed by this war. Ironically, the winners are Russia, in absolute terms, and China, relative to its neighbors.
Comforting to imagine someone is in charge. But given the President's inability to even pursue his own interests coherently, I'm going with Putin got lucky on this dice roll.
Where's the irony if that was the plan?
After WWII, I believe it was one of the most peaceful times in human history. For one thing, the post-war order - the UN, EU, international law, etc. - effectively stopped international war (with a few exceptions).
> 21st century
Even more peaceful, though the prohibition against international war has been violated with the intent of returning to the pre-WWII world.
> After the violence wracked 20th century I was hopeful the 21st century would be a bit more enlightened
People hope for that every century.
And statistically speaking, we may have achieved it. At least since 1950, possibly since the Industrial Revolution, speculatively for millenia, war has become less lethal [1].
[1] https://en.wikipedia.org/wiki/The_Better_Angels_of_Our_Natur...
In absolute numbers the last 100 years have been peak genocide. Of course given the much bigger global population it might well be better per capita. Even if you exclude the contested ones in this list its still a lot: https://news.ycombinator.com/reply?id=47580348&goto=threads%... It also illustrates the capacity we have for mass murder.
The long peace/new peace looks like a bit of historical luck, and increasingly so. The new peace came at time when, post cold war, the world was relatively stable under western dominance, and the west was less inclined to violence as a result of prosperity, the the lessons of the holocaust and WW2, etc. The rise of China (and other Asian powers over time) will make the world look very different.
There were plenty smaller wars even during the "peace" period.
The Trump presidency feels like the dying tremors of imperialist, oligarchic, patriarchal IXX century leadership that resists to disappear.
Like the other two septuagenarian boomer leaders blowing up shit across of the world - Putin and Bibi
If you are talking about the refined product: it will hurt everyone the same, except the executives from big oil, and again, not that sure, because increased transportation/transformation costs decrease productivity, and we can enter a credit crunch that will harm debt-fueled economies pretty hard..
Agree with you that refined products shortage will have the most economic impacts. Gulf States were also the global swing supplier of refined products, with ~20% of waterborne cargos. With Asian refineries (China/Japan/South Korea) also dependent on heavy/medium crude feedstock stuck in the Gulf, fuel production is getting hammered right now from both sides. Countries with local refining capacity will temporarily weather the storm a bit better, but with how interconnected global trade is, short fuel supply will impact everyone, even if its indirectly through higher costs of shipping/transportation/manufacturing/fertilizer, etc.
What? How? Why do you think their order books are swelling?
Seriously? Lockheed Martin makes lots of stuff. They're blaming labor shortages for their woes. But demand for Patriots is growing. Your conclusion that they've been embarassed is countered by the dominant analysis in like every source, from Chinese and Indian (English and local language) to German, American, Israeli and Taiwanese.
Patriot works. It's been shooting down Russia's "hypersonic" missiles. It's been intercepting everything Iran throws at it. Its problem is it's expensive, and Iran's munitions cheap; we need something that isn't built to take down stealth fighter jets and advanced missiles.
This is mostly accurate. Patriot is effective against every "hypersonic" it's been fielded against, though that's mostly because Russia doesn't actually have a hypersonic missile. Iran, fortunately, doesn't have hypersonics–where did you get the idea they do?
Decoys are an issue. Two radar systems not really an issue.
> patriot is <5-10% effective in footage review from early Iran conflict before they started using hypersonic multiple vehicle missiles
Patriot has been about 33% effective. Becasue we fire 3 missiles at each target as standard course. Which means close to 100% intercept rate when targeted. "When targeted" may contain some bullshit, but it's a hell of a better bet than anything Postol is peddling without ample fact checking. (His record has been spotty for a while, particularly when it comes to OSINT.)
Put it another way: Iran has hit...tens of meaningful targets? In America and Israel? Do you think their missiles are just that terrible that they fire hundreds to thousands and a vanishing percentage go where they're meant to? (I'm ignoring that many of the high-value hits were with drones. Not missiles.)
While Iran isn't a superpower, they have hypersonic weapons that no system can intercept very reliably, and a sizeable assortment of ballistic missiles. Even if all other militaries joined forces, they probably couldn't intercept every single projectile coming out of Iran, at least not without depleting their interceptors to unacceptable levels.
Oil prices went up, sanctions got lifted, citizens are now united with the goals of the government, dissidents are silenced, the world hates that the US and Israel did this and blames them directly. Really, there's almost no goal of the IRGC that Trump didn't just speed run by starting a war.
And this was all for what? The US has yet to articulate an actual reason they did any of this other than "Israel was going to do it, so we went along with them". All the politicians in support of this war flounder and have to rely on "Well, they hate us" as justification for why we are killing school girls and attacking Iran's power grids and desalination plants.
I'm not a fan of the IRGC, but this really was the absolute worst way to address them.
This is hyperbole. If Iran could veto the war at the start, they would have. They're coming out of it, right now, relatively better off than the U.S. was when we started inasmuch as we have achieved zero strategic priorities and they've survived while adding a revenue source. But they've also lost massive amounts of military and industrial investment, to say nothing of decades of leadership.
Sure, because nobody likes the unknown prospect of dying or knowing exactly how far this war will ultimately go. However, this has all made the IRGC a lot stronger and has given them a lot more power.
> But they've also lost massive amounts of military and industrial investment
Investment made for exactly the purpose it's being used. They are also massively depleting the US and Israel's munitions. The math is really bad. The missiles and drones are pretty cheap and quick for Iran to manufacture and they've spent decades setting that up because of this very scenario. Meanwhile, the US hasn't had to exercise it's supplies and we already see they are running low as more and more explosives appear to be making their way through the Iron Dome. But also, the massive amount of damage that's been to US bases throughout the region.
> to say nothing of decades of leadership.
Iran's leadership doesn't work like a lot of other nations. The big mistake Trump made was assuming taking out the supreme leader was all it'd take for them to crumble. The government is a lot more complex and not fully invested in one powerful man. And it's this way exactly because of the threat of attack by the US.
This is why after both the US and Israel got to the point where they couldn't figure out who was running Iran, Iran was still continuing attacks on US bases and Israel.
Much like the US government and military, there's not a single politician or general you could take out that would cause a collapse in command. Unlike the US government, they have a very large government body that can pick and choose new leaders pretty quickly. It took them, what, 2 weeks to pick the next supreme leader?
I'm sure Iran didn't want this war, but I'm also sure the IRGC has reaped massive amounts of benefits because of it.
These are all very predictable results and the reason no president has been dumb enough to directly attack Iran. It's been reported that generals were advising against this attack. But even people without US intelligence could have predicted these outcomes.
It's consolidated their rule over a weaker state. Whether that counts as "stronger" and "more power" depends on scoping.
> Investment made for exactly the purpose it's being used
I strongly doubt Iran built a navy so it could be potted in harbor. Same for their launchers, many of which got off a handful of shots at most.
> They are also massively depleting the US and Israel's munitions
Sort of. On the other side, we're seeing a defense-industrial renaissance in the U.S. and Israel, including around cheaper anti-drone defenses [1].
> the massive amount of damage that's been to US bases throughout the region
Massive is hyperbole. Expensive, difficult-to-make equipment has been destroyed. (In large part because we refuse to pay for base hardening.) The worst hit, however, remains more operational than the least-hit Iranian facilities.
> government is a lot more complex and not fully invested in one powerful man
Correct. But the people at the top weren't numpties. Losing talent is losing talent. It doesn't capitulate a well-built system. But it does degrade it. (These are, however, long-term costs.)
> I'm also sure the IRGC has reaped massive amounts of benefits because of it
Perhaps. We won't be able to say definitively until after the dust settles. We've been targeting IRGC heavy equipment and industry, specifically, which means their wealth may have plummeted precipitously, even if they've consolidated power.
[1] https://www.wsj.com/world/america-downs-cheap-drones-with-mi...
Well, I do agree. But I also think that to get to the point where the IRGC doesn't ultimately benefit will mean a very large amount of bloodshed and investment. And by that, I mean the equivalent of dropping nukes on Tehran worth of damage. Ultimately anything short of that will give them a lot of opportunity to rebuild.
I don't think the US can topple them simply be continually bombing. They'd need a pretty massive amount of ground troops deployed or inhumane destruction.
I guess I still hold out hope that Trump pulls out before we get to either point.
If it does go to either point, the world will be royally screwed in terms of oil. Iran isn't going to go down without a massive amount of destruction of oil production throughout the region which is going to wreck the world.
As I've argued, I think we've already left the IRGC weaker–if more consolidated–than it was a few months ago. But levelling it further would just require what Trump has said he wants to do: destroy the local power and water infrastructure.
They might be weaker in the sense that they'll have less soldiers, but as far as a government goes, it will empower them like we've never seen. It will cement their power as the entire population is going to completely support them.
Much like how Hamas still exists even though Gaza has been leveled.
The IRGC controls vast swaths of Iran's economy. They absolutely hurt when e.g. their cement plants are bombed.
And the region's nuclear option, strikes on water infrastructure, looks like it's nearing the table. At which point we're potentially looking at multiple borders shifting in the long run.
> It will cement their power as the entire population is going to completely support them
Doubtful once the rally-around-the-flag effect has dissipated. But a lot can be done in a short amount of time, granted.
> Much like how Hamas still exists even though Gaza has been leveled
Well, yes. But it's a shadow of its former self. Poorer. More vulnerable. Less powerful in all material respects. More consolidated over a smaller area, though with less-tenuous grip even there. Irrelevant on the international geopolitical field.
If you're saying Hamas is today more powerful than it was before October 7, sure, IRGC will be "more powerful" in the same way.
That's what people said with the 79 revolution. It took up till 2026 before there was even a modicum of a risk of the government being dismantlement.
> If you're saying Hamas is today more powerful than it was before October 7, sure, IRGC will be "more powerful" in the same way.
I'm saying Hamas is more popular with the remaining Gaza citizens than it was in the past and it wasn't destroyed.
Now, it is definitely weak enough that Israel can pretty easily just take land. But it took the destruction of about 80% of the buildings to get to that point.
That's what I meant when I talked about needing to drop the equivalent of a nuke in Tehran in order to actually get the IRGC into a state where it's not so much of a threat.
Iran has 90M people living there and if half the population is killed by destroying civilian infrastructure, there are still 45M people there who are also now all completely pissed, not at the IRGC, but at Israel and the US.
The IRGC will ultimately be the force that gets priority on food, water, and shelter. That alone is going to give them a much easier time finding recruits.
A lot of the IRGCs critical military manufacturing and infrastructure is underground. Taking that out is going to be just monstrously hard. That's why the US and Israel have already started to resort to punishing civilians (war crimes, but I guess those no longer matter) rather than the military. They don't have enough intel to find and destroy Iran's manufacturing.
To contrast that with Hamas, they were a much smaller force that relied heavily on getting weapons from the outside. They didn't have weapons manufacturing capabilities and they were completely surrounded by israel which makes it extra hard for them to do anything militarily. Including getting general supplies into the country. And why I brought them up is even with all those disadvantages and the complete destruction of all infrastructure, they were not eliminated.
Iran does not have any of the limitations of Gaza. It's easy for them to smuggle in supplies. They have manufacturing capabilities. They have friendly states at most of their borders.
The only remaining dangerous uprising left are the Kurds that the IRGC managed to strike down while saying "this is a strike against the US interest", and they will probably get help from the Iraki Shi'a paramilitaries to put some pressure.
Honestly, i know it isn't the case, but if you told me an exceptionally competent cabal organized that war to prevent Iran from collapsing: thee regime killed 7-15k in january (or rather, 6-14, around ~1k was regime forces getting killed), but the real information was the number of arrest: 40k, and more than 10k jailed They can now kill their jailed political opponent in secret, because you know, war time. US fuckers couldn't just wait Khomenei's death. he was in phase 4, and his cancer seemed pretty quick ffs.
Could you expand on these? Why would there be Shi'a backlash against the Khomeneis? Who are the MEK?
The MEK were Marxists revolutionary in 79 who were shafted by the new constitution and oppose the Mollahs since then (and probably the reason why Khomenei and Shi'a priests who were exiles in Irak were 'convinced' by Saddam Hussein, a US puppet at the time, to go to Iran take control of the revolution).
Distract from Epstein?
But this is a damocles sword hanging over Iran. The US could seize those tankers if they want to apply more pressure.
Hot take on the internet. Different picture when bombs are raining down on your infrastructure.
Nothing indicates the U.S. is taking Iran's threats of escalation seriously. Like, I think we should. But it doesn't seem to be playing into the calculus. If Iran escalates, the U.S. can too. And I don't think Trump is bluffing about hitting power and water infrastructure.
The reason we aren't hitting the ships is because we want oil to keep flowing into the international markets.
We're not hitting their tankers for the same reason we are suspending sanctions on Russian oil. It's a desperate bid to keep prices at the pump down.
$30 to 70 per barrel [1]. (Pretty much all production is profitable above $100/barrel.)
> they don't really need the Irani oil do they ?
Our refineries can't process our own crude. So we export crude and import refined products.
That said, yes, the oil exports do blunt the net effect of the blow. If pressure really rose, one could tax the excess profits to directly reduce gas prices.
[1] https://www.opxai.com/why-your-oilfield-will-fail-at-60-oil-...
Well.. we can't have America look bad. What would that do to the DOW?
> because they don't want to antagonise China more than they need right now
So, it actually does sound like Iran is pretty cunning here.
Now with Hormuz closed, America needs every last oil barrel moving so the economy doesn’t grind to a halt. Remember, it’s a war of choice for the US. We don’t need Iran gone as much as we want low oil prices.
Technically correct. But the way these countries evade U.S. sanctions is by flying false or no flag. That, in turn, makes them vulnerable under UNCLOS's anti-piracy rules.
But coming back to my original point: it isn’t America’s determination that a registration is fraudulent. It is the flag state’s.
Sort of. If there is no flag, it's America's determination. And in many of the seizure cases, the flag state confirmed a fraudulent registration. (I believe there was one around Venezuela falsely registered with Panama.)
Iran could have leveraged these defensive tactics to make "a mint" from oil exports at any time. The war, for the state that it is in, is not where they are making the money. They have lost money as a consequence of the war and made money from tightening export controls to the point there are physical barriers. The forensic accounting is incidental and well understood from other nations (eg Russia, NK, etc).
The concluding paragraph that might tie these rather boring descriptions of economic machination together, is barely coherent. Read it carefully.
> The extreme redundancy introduces such complexity that the money is getting harder to trace even for Iran’s central bank—and easier for the country’s oil barons to skim. But it keeps the oil machine going. Short of all-out strikes on Iran’s energy infrastructure—to which Iran would respond by bombing that of other Gulf states—it will not be throttled.
Both sentences are baseless indictments, at best. First aimed at oil producers who are "skimming", which they are not. The second run-on is gaslighting Iran as a state, as hell-bent on bombing unnamed neighbors in "the gulf" which seems purposefully chosen as ambiguous.
Is stating facts about the minutia of circumventing sanctions, then demonizing the actors, considered journalism? I don't think so.
Admittedly, the title is somewhat misleading. It doesn't take into account the massive costs Iran is absorbing in destroyed infrastructure, steel production offline, millions displaced, economy in freefall.
> Iran could have leveraged these defensive tactics to make "a mint" from oil exports at any time. The war, for the state that it is in, is not where they are making the money. They have lost money as a consequence of the war and made money from tightening export controls to the point there are physical barriers. The forensic accounting is incidental and well understood from other nations (eg Russia, NK, etc).
This is incorrect. The Strait of Hormuz blockade is a wartime measure. Iran couldn't have blockaded Hormuz in peacetime without triggering the kind of military response it's now already absorbing. The war is what made the blockade possible as a strategy. Iran had nothing left to lose by escalating. The pre war discount was $18–24/barrel. It's now $7–12. That improvement is directly war driven.
> Both sentences are baseless indictments, at best. First aimed at oil producers who are "skimming", which they are not.
The Economist isn't making a moral indictment as much as it's describing a consequence of routing payments through thousands of shell accounts across multiple jurisdictions.
> The second run-on is gaslighting Iran as a state, as hell-bent on bombing unnamed neighbors in "the gulf" which seems purposefully chosen as ambiguous.
Iran has explicitly threatened retaliatory strikes on Gulf energy infrastructure. This isn't speculation or gaslighting, it's stated Iranian deterrence. The article is describing the strategic calculus that makes all out infrastructure strikes unlikely.
> is stating facts then demonizing actors journalism?
You are recharacterizing conclusions drawn from reported facts as demonization, which lets you dismiss any reporting that reaches an unflattering conclusion about any actor.
Which specific factual claim in the article do you think is wrong?
So they could have, for the reasons you have pointed out. It's not "because of the war" but it is a consequence for someone to do something they could have done and "triggered the kind of military response it's now already absorbing." - you and I have a very different idea of what reality is.
> The Economist isn't making a moral indictment as much as it's describing a consequence of routing payments through thousands of shell accounts across multiple jurisdictions.
Please don't do that. None of the last paragraph is about consequence of routing payments.
I have pointed out how the facts are a facade for demonization. I stand by it.
>journalism of sometimes radical opinion with a reverence for facts [1]
I dropped my subscription to The Economist precisely because of its tiresomely doctrinaire approach to economics. But I still consider their journalists to be first-rate and I trust their reporting to be factually correct.