The U.S. plan to reopen the Strait of Hormuz has been gutted before it could launch. Saudi Arabia and Kuwait have refused to grant the U.S. military access to their bases and airspace for Project Freedom, the planned operation to secure the waterway. On Breaking Points, Saagar Enjeti noted that Saudi Crown Prince Mohammed bin Salman specifically denied access to the crucial Prince Sultan Air Base in a call with Trump.
Iran's strategy of horizontal escalation - targeting oil facilities across the Gulf - has terrified regional partners. They no longer believe the American security umbrella can protect their infrastructure. Without local runways and fuel depots, a sustained U.S. air campaign is impossible. New satellite imagery confirms Iranian drone strikes in early March destroyed the majority of U.S. fuel bladders in Kuwait and damaged critical aircraft hangars.
“Saudi Arabia and Kuwait recently informed the Trump administration that they will not permit the US military to use their bases or airspace for Project Freedom.”
- Saagar Enjeti, Breaking Points
Iran has zero financial incentive to end the blockade. On Macro Voices, Louis-Vincent Gave argues Iran is charging an estimated $2 million per ship to pass the Strait and selling its own oil at a massive premium. At 100 ships, the toll revenue equals roughly 20% of Iran's GDP. “Unless they are bombed back to the middle ages, they have no reason to stop the tolls,” Gave said.
The U.S. faces an imminent energy crisis regardless of diplomacy. Gave warns global oil buffers are scheduled to run out in early June. Even if the Strait reopened tomorrow, it takes six weeks for tankers to reach destinations, meaning a physical shortage is already locked in. On Forward Guidance, Quinn Thompson noted the U.S. Strategic Petroleum Reserve is at multi-decade lows, removing any cushion.
Domestically, the administration is preparing for severe economic pain. Trump has argued that even if oil hits $200 a barrel - translating to $8-9 per gallon gas - the war would be worth it. This rhetoric clashes with a labor market where AI is purging entry-level professional jobs while inflation remains sticky, creating a K-shaped crisis where bottom-decile earners are already cutting consumption.
“The market assumes the Strait of Hormuz will reopen shortly. Gave thinks the incentives say otherwise.”
- Louis-Vincent Gave, Macro Voices
The geopolitical realignment is structural. Nations are shifting from financial liquidity to physical security, hoarding fuel and food. China saw this coming and now holds roughly 1.8 billion barrels of oil in reserve. The era of relying on the U.S. Navy to keep sea lanes open is over, forcing every major economy to build its own stockpiles. The American alliance system in the Gulf has cracked under pressure Iran expertly applied.
