This is old news but I thought I should mention some of what's been guiding our thinking on events over the last 2 1/2 months.
First up, Cambridge Uni. Professor of Political Economy Helen Thompson at MarketWatch, April 11:
What if Trump actually wanted this Hormuz outcome all along?
Cambridge professor Helen Thompson says the consistent ‘thread’ through the second Trump administration has been resetting the energy part of the world geopolitically
Since the start of the Iran war, the conventional wisdom has been that the whole thing is a hot mess. The argument is that President Donald Trump either blundered into a strategic situation he didn’t understand or was suckered into it by Israeli Prime Minister Benjamin Netanyahu, with disastrous consequences.
These range from the humanitarian — starting with the killing of around 165 Iranian schoolgirls, apparently by a U.S. missile — to the economic and even geopolitical. Oil is up to $100 a barrel, gasoline is nearly $4.20 a gallon nationally, and — irony of ironies — the enemy regime in Tehran has been left with control of the Strait of Hormuz and about 20% of the world’s oil supply.
The Iranians are now reportedly charging a toll of $1 a barrel — payable apparently through nontraceable cryptocurrency or in Chinese yuan Trump, who has repeatedly called the regime evil and worse, was left surprised that it acted in such a “dishonorable” manner with regard to the cease-fire.
But what if the conventional wisdom is wrong?That’s the hypothesis of one of the world’s shrewdest and most respected analysts of geopolitics and energy, Cambridge University political-economy professor Helen Thompson. In a couple of recent broadcasts, she has argued that this entire outcome — including the apparent closure of the Strait of Hormuz — may not be a bug of the war at all but a deliberate feature.
Thompson argues that driving up the worldwide price of oil and keeping it there may be a core war goal of the Trump administration. That hurts China, which depends on imported energy, and helps America, which is a net energy producer. And if that’s the case, then Iranian control over the strait would, ironically, be a desirable outcome.
“The Trump administration thinks through the lens of resource competition,” Thompson explained.
“You have to consider the possibility … that actually part of what’s going on isn’t just about Iran, it’s about the Trump administration trying to hurt China,” she told the conservative-leaning website UnHerd.
The Iran war may be “part of an attempt by the Trump administration to reset the energy part of the world geopolitically,” she told Bloomberg Podcasts.
That, according to Thompson, is the consistent “thread” running through the second Trump administration’s foreign policy — including the intervention in oil-rich Venezuela and the attempt to destabilize resource-rich Greenland. It is also, she said, part of a geopolitical blueprint that the administration laid out last fall.
America, Thompson pointed out, may be a “beneficiary” of the war economically because it will be able to sell more liquefied natural gas at elevated prices, especially to the Europeans.
She added that, right now, competitive thinking between the U.S. and China focuses on artificial intelligence, which uses a staggering amount of energy. Driving up China’s energy costs hurts its AI ambitions.
Thompson also pointed out that it wasn’t just the Iranians who “closed” the Strait of Hormuz. Western shipping insurers became worried about the risks, especially after the Iranians attacked some ships. And after initially floating the notion of stepping in and providing insurance to ships through the U.S. government, the Trump administration soon walked away from the idea. That would be consistent with the theory that the administration does not want fuel to flow freely through the strait, because it wants oil and gas to remain expensive....
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And at gCaptain, March 18:
The Hormuz Hypothesis – What If the U.S. Navy Isn’t in a Hurry to Reopen the Strait?
By Captain John Konrad (Opinion) – The Strait of Hormuz is twenty-one miles wide. Two shipping channels, each two miles across, separated by a two-mile buffer. There is no alternative. Saudi Arabia’s East-West Pipeline to Yanbu and the UAE’s pipeline to Fujairah can handle maybe five million barrels combined. The math doesn’t work. The bottleneck is not political. It is geological and hydrographic.
Every TV analyst in America is talking about minesweepers and carrier strike groups. They are asking the wrong questions. The binding constraint on Hormuz was never a minefield or insurance. It is the US Navy’s willingness and ability to reopen it.
Every talking point suggests the White House and Navy are working hard to reopen the strait but progress is slow. A new posts on Truth Social suggests we may have to considet a new hypothesis.
“I wonder what would happen if we “finished off” what’s left of the Iranian Terror State, and let the Countries that use it, we don’t, be responsible for the so called Strait?” wrote President Trump in a psot this morning. “That would get some of our non-responsive “Allies” in gear, and fast!!!”
Which leads to a question, White House may have no intention of reopening the Strait of Hormuz?
The Insurance Kill Switch
When the seven P&I clubs belonging to the International Group issued 72-hour cancellation notices for war risk coverage in the Persian Gulf on March 5, they did not just raise costs. They made transit impossible.P&I clubs insure roughly 90 percent of the world’s ocean-going tonnage. Without their coverage, ships cannot sail. Port authorities will not let them dock. Banks will not finance the cargo. Charterers will not book the vessel. The entire system, from loading berth to discharge terminal, is underwritten by a chain of contracts that begins with a club in London, Oslo, or Tokyo. When the clubs pulled war risk extensions, that chain broke. Not for a few ships. For the global fleet.
War risk premiums jumped from 0.25 percent to 1 percent of hull value, renewable every seven days. VLCC charter rates quadrupled to nearly $800,000 per day. Over 1,000 vessels are now trapped in the Persian Gulf, burning charter costs with nowhere to go. By March 3, only four ships crossed the Strait, down from a seven-day average of seventy-seven.
Then Trump did something that almost nobody in the press understood.
He ordered the U.S. International Development Finance Corporation to create a $20 billion maritime reinsurance facility, with Chubb as lead underwriter, making the United States government the insurer of last resort for Gulf shipping. A sovereign nation positioned itself as the backstop for war risk insurance on the world’s most critical maritime chokepoint. The DFC facility, coordinated with US Central Command and Treasury, offers hull, machinery, and cargo coverage on a rolling basis to eligible vessels.
The United States now controls the on/off switch for the Strait of Hormuz. Not through naval firepower. Through insurance.
Read the latest MARAD advisory carefully: U.S.-flagged, owned, or crewed commercial vessels operating in these areas should maintain a minimum standoff of 30 nautical miles from U.S. military vessels.
And read this part of the DFC announcement again… “coordinated with US Central Command.”
They cannot pass without the Navy permission.
The green light has not appeared.
The Maritime Dream Team That Was
To understand why this matters, you need to understand what Trump built and what was destroyed.Trump came into his second term determined to restore American maritime power. He assembled the greatest collection of maritime minds in key government positions since Nixon. He put Mike Waltz, creator of the SHIPS for America Act, as head of the National Security Council. He created a Maritime Office in the White House. He appointed maritime advocates to key positions throughout the administration. He signed a sweeping Maritime Executive Order in April 2025 directing a Maritime Action Plan across Defense, State, Transportation, and Homeland Security.
He started targeting chokepoints: Panama, the Red Sea, Suez, the Greenland-UK Gap. He launched investigations into Gibraltar and Spain. He created USTR actions to tariff Chinese-built and operated ships. He called CMA CGM’s CEO Rodolphe Saadé to the Oval Office and secured a $20 billion commitment to American maritime investment.
The ambition was real.
So was the pushback.
Shipowners lined up outside USTR to protest the China shipping tariffs. Nearly every economist on the planet lined up against the maritime tariff proposals. The entire U.S. tech sector asked for China concessions, and what did China want in return? A pause to USTR.
Then Signalgate. The media leaked a private conversation about attacking the Houthis and reopening the Red Sea. The operation was stunned. Signalgate forced a reorganization. Waltz was moved to the UN. The Maritime Office was downsized. The NSC was gutted.
That was the moment every maritime initiative began to stall.
What collapsed: Panama did not follow through on free transits for U.S. ships. CMA CGM’s $20 billion commitment evaporated as the company ordered vessels from China and India instead. Congress stalled on the SHIPS Act. The UK traded the Chagos Islands, including Diego Garcia, to Mauritius for a sweetheart deal, putting a critical naval base at risk. Key Navy appointees were slow-rolled or blocked in the Senate.
Then it came to a head at the International Maritime Organization in London. In April 2025, sixty-three countries voted to approve the Net-Zero Framework, a global carbon pricing mechanism on every ship over 5,000 tons. What did Trump’s negotiators ask for? That America’s tiny fleet of merchant ships be exempt. Europe refused, claiming American maritime interests are “irrelevant” and that we lack the leverage or votes.
The U.S. walked out. In October, at the adoption vote, Trump called it a “Global Green New Scam Tax on Shipping.” Trump played hardball. The State Department threatened sanctions against any country that voted yes. Fifty-seven countries voted to delay.
A pyrrhic victory. The carbon tax was dead in the water, but we did not get exemptions for U.S. ships, and the White House began losing the wider war for chokepoints and maritime trade with the City of London, Europe and China.
Then two body blows in quick succession.
On February 20, the Supreme Court ruled 6-3 that IEEPA does not authorize the President to impose tariffs, invalidating the “Liberation Day” reciprocal tariffs and the China, Canada, and Mexico trafficking tariffs. An estimated $160 billion in tariff revenue, gone. Trump imposed 15 percent global tariffs under Section 122, but those are capped at 150 days and require Congressional extension.
His most powerful tariff tool was taken away by the courts. If you cannot tariff your way to compliance, you need another form of leverage.
And then the Golden Fleet.
In December, Trump announced a new class of Trump-class battleships at Mar-a-Lago: 30,000 to 40,000 tons, armed with hypersonic missiles, railguns, lasers, and nuclear cruise missiles. Twenty to twenty-five hulls. The most ambitious surface combatant program since World War II.
Within 72 hours, every national security think tank and academia – which all have close ties and funding with NATO nations – lined up to kill it. With no time for due dillegence CSIS published the hit piece “The Golden Fleet’s Battleship Will Never Sail” and estimated $9 billion per hull and predicted cancellation before the first ship hits water. The Foundation for Defense of Democracies called it a waste. Retired admirals on defense baords lined up to say the Navy should buy small distributed platforms instead. Every defense analyst competed to be quoted saying it was impossible.
The same establishment that produced three Zumwalts instead of thirty, and thirty almost useless Littorial Combat Ships instead of none, the same think tanks that has presided over the smallest Navy since World War I, lined up overnight to explain why America cannot build big ships anymore.
The same people who have no plan to close the destroyer gap that is right now undermining convoy escort operations in the Gulf.
The think tanks did not offer an alternative. They offered learned helplessness. And that helplessness is the context in which Hormuz is now playing out.
The Leverage Hypothesis
Now connect the dots.Strike Iran, and Europe either bends or goes dark in an energy crisis.
The European shipping community and political establishment spent the past year dismissing, undermining, and mocking every Trump maritime initiative. They scoffed at the USTR tariffs. They laughed at the SHIPS Act. They blocked the IMO exemptions. They refused to take American maritime policy seriously.
Now their energy supply runs through an insurance facility controlled by Washington.
“Let their navies figure it out.” Except everyone knows they cannot. European naval forces are too small, too slow, and too poorly equipped for sustained convoy escort operations through a contested strait. All the European navies combined could not send more than three ships at a time to defend the Red Sea. An entire German task force sailed around Africa to avoid it....
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So we don't have a lot of Taco Tuesday posts. One
On May 6 because in was in Marc Chandler's headline.
But speaking of Mexican food we have on offer, from a couple years ago:
"The first Mexican taco stand to get a Michelin star is a tiny business where the heat makes the meat"
