This post is opinion only. See full disclaimer below.
Post updated.
I have a friend, who when it comes to real-politique foreign policy, is one of the smarter people I know. They recently pointed out something, which I am not at all sure I agree with, but since this is a higher level analytical site, I thought I’d share it with my audience. This will be a very short post because it’s simply one overall macro idea.
A lot of the media is saying right now that Trump could not possibly have gone into this war, if he had fully understood the risk of oil spiking as high as it could, the difficulty of securing the Strait of Hormuz, or the potential for asymmetric warfare by Iran. The goal is unchallenged US hegemony, but the cost could be a huge oil price rise and potentially losing the midterms or the US getting caught in a quagmire especially since, at least at this point, real regime change seems unlikely even if the US claims it has already occurred to a degree. Perhaps, none of this will occur, and the war will soon be over, but nobody knows for sure.
But what this person told me is what if from a real-politique perspective Trump really doesn’t care if the war takes much longer to conclude? Sure, the US would prefer a quick victory and to be able to say the Middle East has permanently changed and will now enter a new phase with American dominance. That was the goal. However, let’s say the war does drag on, and Trump loses the mid-terms, and oil spikes much higher and then stays there. Or lets say Trump simply leaves the war with the Strait still closed and conflict in the region continuing and unilaterally ends the role of the US directly inn the conflict. Who does it really hurt in the broadest international geopolitical terms? It raises issues for the US economy to be sure, and Trump may be counting on new election rules passing the senate to save his congressional majority and avoid this political loss, but even if he loses the upcoming mid-term elections, the crucial next presidential election for his party is still 2 and a 1/2 years away. But if oil spikes a lot, who wins and who loses in the scenario in purely power terms? The actual “winners,” in this worst case scenario, are without question my friend says, the Americas as a whole, the US and other oil exporter nations far from the conflict zone—Brazil, Colombia, Venezuela, Ecuador, and Canada, to name just five. They are the countries who win big relatively speaking in this scenario.
However, oil at 100 or 120 or 150 dollars a barrel is nothing less than a total disaster for Asia and for Europe. Oil at 200 dollars a barrel is almost unimaginable. China loses big time as does Korea and Japan. And the E.U., after all the years of pushing for clean energy and decreasing oil reserves and production but still relying so heavily on things like imported natural gas, has huge problems at those oil price numbers, as do the Asian countries. Power shifts away from Asia, Europe and the Middle East to the Americas, my friend argued. What my friend said is, “What if Trump is so hardcore real-politique he may believe, even in the worst case scenario, the US ends up with a huge strategic advantage over the other power blocks in the world?”
Now, if he does unilaterally pull out of the conflct, and troop deployments say otherwise, this does raise the key counterfactual of the Strait potentially being controlled by Iran and indirectly by China. That would not be ideal for the US from a real-politique standpoint to be sure. But what if it’s not so much control as simply a chaotic situation where oil spikes as a result with the Middle East staying in unresolved conflict? Then my friends point might still be valid.
In the 80’s after all, the US in part used a huge oil price decrease to help to end the Soviet Union. Could the plan be now to use a huge oil price rise to severely effect China? Supposedly Xi, when he became Premier, wisely commissioned a study to find out what had gone wrong with the Soviet Union that led to the Communist Party’s collapse. The study no doubt told him a good deal, and some of it probably effected policy. But one wonders, did it anticipate the possibility of an Iran war spiking oil to very high prices? I’m not at all sure that can be ruled out. Or as my friend argued, if after the Iran War oil spikes for quite a while and the US also controls Venezuela and its oil is that not a big problem for China?
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