Eye On The Market Salem’s Lot: Gulf War update; the Purge of senior US military officers; a US fossil fuel reliance fever dream
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Apr 6, 2026 A Gulf War update covering global commodity price pass-throughs and how U.S. energy independence has limits. Discussion of Gulf heat effects that constrain military options and Iran’s proposed toll on the Strait of Hormuz. Analysis of asymmetric warfare costs, drone versus missile tradeoffs, and a recent spike in senior military firings. A hypothetical U.S. fossil fuel reliance scenario and challenges for rapid renewables scale-up.
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US Energy Independence Has Limited Protection
- The US being a net fossil fuel exporter does not insulate it from global price shocks.
- Jet fuel and several refined product pass-through rates to US prices are ~70–100%+, meaning US prices rose as much or more than international ones.
Gulf Summer Heat Limits Military Options
- Summer Gulf temperatures create severe operational limits for military offensives.
- Peak air and exposed metal temps hit 120–160°F by June, causing vehicle, radar failures and heat stress that can preclude operations.
Iran Could Extract Huge Toll From The Strait
- Iran could monetize control of the Strait of Hormuz with huge one-time or recurring tolls.
- Charging $2M per vessel (140/day) would imply ~$100B/year; even charging stranded ships once could raise $4–6B immediately.