How Iran is making a mint from the current war (economist.com)

by Jimmc414 84 comments 57 points
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84 comments

[−] Synaesthesia 46d ago
The big loser in this war is Europe and other roil importing nations.

The US is a major oil and has producer. It's benefiting from this war of aggression and not even taking any damage.

Oil companies and arms manufacturers are having a bonanza.

After the violence wracked 20th century I was hopeful the 21st century would be a bit more enlightened ...

[−] cogman10 46d ago

> The US is a major oil and has producer. It's benefiting from this war of aggression and not even taking any damage.

Oil companies are benefiting, everything else in the US suffers. Money isn't going to trickle out of these oil companies to spur economic activity.

Nations that benefit from the war do so because of nationalized oil production. Any nation without that is going to ultimately suffer because that added oil revenue doesn't make it's way back to the public.

All nations are going to look at increased food costs and potentially even shortages next year due to increased fertilizer and transport costs.

[−] measurablefunc 46d ago
It's not that simple. Production costs have gone up for everyone, inflation is going to get worse so the simple logic of "higher prices, higher profits" doesn't really work in this case.
[−] cogman10 46d ago
There will be a short term long term thing with this. I agree with you that ultimately everyone loses long term. Short term the higher prices will result in higher profits which will enrich whoever owns the oil.

We aren't at the end of the inflation, though, that's going to hit. This is only the beginning. Next year will be when things really go south. At this point it's not a question of if, but rather how bad.

[−] measurablefunc 46d ago
I agree.
[−] cm2187 46d ago
The US consumer will still pay more at the petrol station. Doesn't matter to them that some big oil companies are making a killing somewhere else in the US. US consumers vote.
[−] oefrha 46d ago
Hey, everyone benefits from the rise in GDP per capita due to oil companies and MIC making a killing. /s
[−] kackerlacker 46d ago
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[−] thatcat 46d ago
Pretty sure the big losers are US missile intercept systems manufactures since they've basically been outed as useless so I'm not sure who would want to buy them now. And Israel, of course, who is getting struck as a result of their over reliance on these systems. US bases are being wrecked, all the radar systems are gone, several carriers damaged - not sure that is no damage.
[−] JumpCrisscross 46d ago

>

losers are US missile intercept systems manufactures since they've basically been outed as useless

What? How? Why do you think their order books are swelling?

[−] thatcat 46d ago
Lockheed martin PAC3 manufacturer is down 11% this month.
[−] JumpCrisscross 46d ago

>

Lockheed martin PAC3 manufacturer is down 11% this month

Seriously? Lockheed Martin makes lots of stuff. They're blaming labor shortages for their woes. But demand for Patriots is growing. Your conclusion that they've been embarassed is countered by the dominant analysis in like every source, from Chinese and Indian (English and local language) to German, American, Israeli and Taiwanese.

Patriot works. It's been shooting down Russia's "hypersonic" missiles. It's been intercepting everything Iran throws at it. Its problem is it's expensive, and Iran's munitions cheap; we need something that isn't built to take down stealth fighter jets and advanced missiles.

[−] thatcat 45d ago
I mean even a cursory analysis will show that it's physically impossible for it to work against multiple vehicles/decoys. They also make the "stealth" f35, their contracts for this stuff is from Jan - probably will still make money from US/Saudi, but good luck selling to Germany or Japan.
[−] urikaduri 40d ago
Over the past 2 years, Elbit stock is up 329%
[−] froggy 46d ago
Which missile intercept systems do you refer to? Surely not the Patriot which has proven to be most effective in Ukraine. Due to poor planning, it sounds like the Patriot stocks have been blown thru so now things are exposed.
[−] thatcat 46d ago
Iran copied oreshnik system, added decoys and other stuff, patriot is not effective against hypersonic, multiple vehicle missiles or decoys (which would require 1 patriot per vehicle) and is dependent on 2 radar systems functioning in the correct locations and the correct angle of attack from firing location. See Ted Postol's coverage https://www.youtube.com/live/Q2yQ3kBAQIk?si=JLvN2mVleKv64YDs. Even patriot is <5-10% effective in footage review from early Iran conflict before they started using hypersonic multiple vehicle missiles.
[−] JumpCrisscross 46d ago

>

patriot is not effective against hypersonic, multiple vehicle missiles or decoys (which would require 1 patriot per vehicle) and is dependent on 2 radar systems functioning in the correct locations and the correct angle of attack from firing location

This is mostly accurate. Patriot is effective against every "hypersonic" it's been fielded against, though that's mostly because Russia doesn't actually have a hypersonic missile. Iran, fortunately, doesn't have hypersonics–where did you get the idea they do?

Decoys are an issue. Two radar systems not really an issue.

> patriot is <5-10% effective in footage review from early Iran conflict before they started using hypersonic multiple vehicle missiles

Patriot has been about 33% effective. Becasue we fire 3 missiles at each target as standard course. Which means close to 100% intercept rate when targeted. "When targeted" may contain some bullshit, but it's a hell of a better bet than anything Postol is peddling without ample fact checking. (His record has been spotty for a while, particularly when it comes to OSINT.)

Put it another way: Iran has hit...tens of meaningful targets? In America and Israel? Do you think their missiles are just that terrible that they fire hundreds to thousands and a vanishing percentage go where they're meant to? (I'm ignoring that many of the high-value hits were with drones. Not missiles.)

[−] thatcat 45d ago
How would you know how many vehicles there are when it separates late? Some Iranian munitions have 80 vehicles. Maybe they don't have the fastest hypersonics or large payloads in them, but it seems like the combination of high speed + multiple vehicles + late separation poses an extreme challenge to these systems. I'm sure he's exaggerating or has biased sample data, but the missile intercept marketing team seems to be exaggerating quite a bit as well. There are many videos that seem to show them squirming around in the sky like lost sperm and then blowing up without hitting the missile and falling to the ground.
[−] dlubarov 46d ago
We need to have realistic expectations though - air defense is an inherently asymmetric problem. The US broadly has the best air defense, but it's explicitly not focused on Russia or China, because it acknowledges that deterrence is the only plausible defense there.

While Iran isn't a superpower, they have hypersonic weapons that no system can intercept very reliably, and a sizeable assortment of ballistic missiles. Even if all other militaries joined forces, they probably couldn't intercept every single projectile coming out of Iran, at least not without depleting their interceptors to unacceptable levels.

[−] vrganj 46d ago
Longer term Europe is positioned to come out of this looking pretty good.

Renewables already surpass fossil fuel in the energy mix [0], this will only accelerate the shift to energy independence.

It's countries that actively resisted diversifying their energy mix like the US that will feel the long term pain.

[0] https://www.theguardian.com/environment/2026/jan/22/wind-and...

[−] orwin 46d ago
Crude oil isn't as commoditized as LNG. Europe refineries (at least France, but probably most of Western Europe) are made to refine oil from Africa and the north sea, and wouldn't know what to do with ME oil anyway. Algeria or Libya can't suddenly sell their crude to asia or the US, because the refineries able to transform it are in europe. This will hit european countries that depends on LNG, but the impact on crude oil price in both the Texas index and the north sea index will be felt way less than in Asia.

If you are talking about the refined product: it will hurt everyone the same, except the executives from big oil, and again, not that sure, because increased transportation/transformation costs decrease productivity, and we can enter a credit crunch that will harm debt-fueled economies pretty hard..

[−] pzo 46d ago

> The big loser in this war is Europe and other roil importing nations. > The US is a major oil and has producer.

US citizens are loosers as well since cost of oil increased for them as well. This will also have inflation impact on other products from them as well on top of previous tariffs.

[−] mmooss 46d ago

> violence wracked 20th century

After WWII, I believe it was one of the most peaceful times in human history. For one thing, the post-war order - the UN, EU, international law, etc. - effectively stopped international war (with a few exceptions).

> 21st century

Even more peaceful, though the prohibition against international war has been violated with the intent of returning to the pre-WWII world.

[−] JumpCrisscross 46d ago

>

Europe and other roil importing nations

Europe and Asia have been royally screwed by this war. Ironically, the winners are Russia, in absolute terms, and China, relative to its neighbors.

[−] bestouff 46d ago
US oil producers will win yes, because the prices are going up and they can provide. But the US consumers will feel it badly.
[−] graemep 46d ago
The big loser is Asia. Heavily dependent on oil going through Hormuz.

> After the violence wracked 20th century I was hopeful the 21st century would be a bit more enlightened

People hope for that every century.

[−] enaaem 46d ago
If the new status quo is that Iran will control the strait then te rest of the world will just pay toll to Iran.
[−] chinathrow 46d ago
Time to get off if oil, like yesterday.
[−] twodave 46d ago
"Enlightenment" is for civilizations with enough might to enforce it.
[−] dlev_pika 46d ago

> After the violence wracked 20th century I was hopeful the 21st century would be a bit more enlightened

The Trump presidency feels like the dying tremors of imperialist, oligarchic, patriarchal IXX century leadership that resists to disappear.

Like the other two septuagenarian boomer leaders blowing up shit across of the world - Putin and Bibi

[−] nine_zeros 46d ago
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[−] Jimmc414 46d ago
[−] Eddy_Viscosity2 43d ago
Will this income come anywhere near the cost of replacing all the infrastructure that was destroyed?
[−] enaaem 46d ago
Trump cancelled the Iran deal. Now the US has nothing and Iran has found an infinite money glitch.
[−] cogman10 46d ago
This war has been one of the best things to happen to the IRGC.

Oil prices went up, sanctions got lifted, citizens are now united with the goals of the government, dissidents are silenced, the world hates that the US and Israel did this and blames them directly. Really, there's almost no goal of the IRGC that Trump didn't just speed run by starting a war.

And this was all for what? The US has yet to articulate an actual reason they did any of this other than "Israel was going to do it, so we went along with them". All the politicians in support of this war flounder and have to rely on "Well, they hate us" as justification for why we are killing school girls and attacking Iran's power grids and desalination plants.

I'm not a fan of the IRGC, but this really was the absolute worst way to address them.

[−] aaron695 46d ago
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[−] crimshawz 46d ago
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[−] cm2187 46d ago
It's a bit absurd to describe all the procedures Iran takes to disguise those ships. It's not like it is hard for the US military to track massive tankers in a small sea (or to intercept them if they wish to). Those tankers are tolerated by the US because they don't want to antagonise China more than they need right now (not the least to keep them out of this conflict), and don't want to add more pressure on the oil market. Not because somehow those ships evaded US vigilance thanks to Iran's cunning skills.

But this is a damocles sword hanging over Iran. The US could seize those tankers if they want to apply more pressure.

[−] krunck 46d ago
The Economist doesn't know the difference between journalism and opinion. Ignore them.