This week's assessment:
Ongoing tracking of the Strait of Hormuz:
Iran maintains control of the strait and enforces a 'crypto toll'
Although the US destroyed the core of Iran's regular navy, a large number of small, fast attack boats from Iran's Revolutionary Guard remain intact, allowing effective control over the Strait of Hormuz, restricting navigation, and imposing charges. Oil tankers passing through the strait are required to pay a toll of about one US dollar per barrel in cryptocurrencies such as Bitcoin. Iran is leveraging cryptocurrency to bypass financial sanctions. This has caused the Strait of Hormuz to transform into an Iran-dominated, inefficient, opaque, and fee-based 'controlled navigation' new equilibrium. The global energy supply chain will be locked into long-termstructural risk premiums and additional costs. Even after the conflict ends, the efficiency and costs of passage will have suffered irreversible deterioration.
Goldman Sachs admits error on fertilizer crisis
Goldman Sachs acknowledged underestimating the severity of the fertilizer crisis and significantly revised its forecasts upward. The blockade of the strait has caused violent fluctuations in the global fertilizer market, with the nitrogen fertilizer industry chain being the hardest hit. Global urea prices have surged 50% to 70% since the conflict began. Goldman Sachs pointed out that the Middle East's nitrogen fertilizer production structure, based on cheap natural gas, has made it a vulnerable link in this conflict, with impacts now extending fromprice anomalies evolving into a structural supply crisisWe repeatedly warned last month that the fertilizer price increases would ripple through to grains and then to livestock, forming an entire chain of price hikes. Related companies stand to benefit.
US Senate Restricts Presidential War Powers
US Senate Democratic Leader Chuck Schumer publicly criticized the Trump administration’s military actions against Iran as an 'epic failure' and announced plans to force a vote every week...