Sunday, April 19, 2026

On Our "VIrtual Route 99" (Weekly Edition): Around the World This Week






 


And, just like that, President Donald J. Trump’s triumphant boasting that the Strait of Hormuz had been permanently reopened has unraveled in less than 24 hours. Citing the continuing U.S. blockade, Iranian officials announced they were closing the strait again. Reports say Iranian forces fired on two ships trying to cross the strait. Iranian media said: “Until the United States ends its interference with the full freedom of movement for vessels traveling to and from Iran, the status of the Strait of Hormuz will remain under intense control and in its previous state.”

Susannah George of the Washington Post noted that the fragile temporary ceasefire between Israel and the government of Lebanon also appears to be cracking. Israel has been bombing southern Lebanon where Iran-backed Hezbollah militants operate, and Israel Defense Forces said Saturday that it believed Hezbollah had violated that ceasefire. It said: “IDF is authorized to take the necessary measures in self-defense against threats, while ensuring the security of Israeli civilians and the soldiers deployed in the area.”

This morning, Trump said Iran wanted “to close up the strait again, you know, as they’ve been doing for years, and they can’t blackmail us.” In fact, the strait was open until Trump began to bomb Iran on February 28. Trump’s choice of the word “blackmail” is interesting in this context, for there have been no public threats of exposing someone’s secrets or threatening harm to them in association with the crisis in Iran.

MeidasTouch reports that Iran says it has not agreed to further talks with the U.S. because of its pressure tactics and what it calls “unreasonable demands.”

The Institute for the Study of War assesses that Iranian political officials are not the ones controlling decision-making. Instead, it appears the Islamic Revolutionary Guard Corps (IRGC), the primary force of the Iranian military, is in charge. Benoit Faucon of the Wall Street Journal writes that disagreements about what’s happening in the Strait of Hormuz suggest divisions in Iran’s leadership.

Rebecca F. Elliott of the New York Times reminds readers that even if the strait does open fully, it will take weeks for oil from the region to flow back into world markets. High oil prices will persist for weeks, at least, as producers wait to make sure stability has really returned before they ramp production back up on the 20% of facilities in the region that have not been damaged. The damage from Trump’s attack on Iran “has inflicted the kind of damage that takes months, if not years, to repair,” Elliott wrote. Energy research and investment firm partner Arjun Murti told Elliott: “We don’t expect oil prices—and therefore pump prices—to go back to prewar levels.”

Once again, Trump’s announcement of the opening of the strait seemed timed to give the markets a bounce before the weekend. Those watching the markets observed massive trades yesterday just before Trump’s announcement. Regulators are currently examining similar trades from one of Trump’s similar announcements last month.

Meanwhile, Shelby Holliday, Michael R. Gordon, and Costas Paris of the Wall Street Journal report that the U.S. military is “preparing…to board Iran-linked oil tankers and seize commercial ships in international waters” in an attempt to force Iran to reopen the strait and back away from its nuclear program. President Barack Obama’s team, along with China, France, Germany, Russia, and the United Kingdom had achieved both of those goals with the 2015 Joint Comprehensive Plan of Action (JCPOA) Trump tore up in 2018.

The journalists report that, as part of the U.S. blockade of Iranian ports, the U.S. Navy has already forced twenty-three ships trying to leave Iranian ports to turn back. Now it intends to take control of vessels around the world that are linked to Iran. The administration is calling this phase of the U.S. war against Iran “Economic Fury.”

The chairman of the Joint Chiefs of Staff, General Daniel Caine, said yesterday that the U.S. “will actively pursue any Iranian-flagged vessel or any vessel attempting to provide material support to Iran. This includes dark fleet vessels carrying Iranian oil. As most of you know, dark fleet vessels are those illicit or illegal ships evading international regulations, sanctions or insurance requirements.”

On Wednesday the USS Gerald R. Ford, the largest aircraft carrier in the world, broke the record for the longest deployment of an aircraft carrier since the Vietnam War: 295 days. The vessel left its home port in June 2025 for the Mediterranean but was rerouted to the Caribbean as part of Trump’s buildup there. It took part in the capture of then–Venezuelan president Nicolás Maduro, then headed to the Middle East. A fire in one of its laundries left 600 sailors without berths, and it went to the Mediterranean for repairs.

Nahal Toosi of Politico wrote yesterday that, according to diplomatic cables she obtained from U.S. diplomats in Azerbaijan, Bahrain, and Indonesia, the Iran war is hurting U.S. interests abroad. The U.S. is losing the trust of the populations of those countries and possibly of their governments as well. Indonesia is the biggest Muslim-majority country in the world, with more than 287 million people, and under President Joe Biden the U.S. had been working to strengthen ties with it.

Trump’s erratic behavior has caught the attention of the New York Times, where on April 13 Peter Baker wrote that the president’s threat that “a whole civilization will die tonight,” along with his attacks on Pope Leo XIV, “have left many with the impression of a deranged autocrat mad with power.” Baker noted that retired generals, diplomats, foreign officials, and even Trump’s former allies on the right are all expressing concern.

Yesterday Steve Hendrix and Stefano Pitrelli of the Washington Post reported that Trump’s erratic behavior is alienating even those right-wing populists in Europe who hailed his reelection in the belief that it would strengthen their own hand. The authors say that Trump’s high tariffs, demands for Greenland, and surprise attack on Iran had already put right-wing leaders in an awkward position. For some of them, his portrayal of himself as Jesus on Orthodox Easter and his attacks on the pope are a bridge too far.

In Italy, Prime Minister Giorgia Meloni, a Catholic, said Trump’s attack on the Pope is “unacceptable.” In turn, Trump attacked Meloni, saying: “She doesn’t want to help us with NATO, she doesn’t want to help us get rid of nuclear weapons. She’s very different from what I thought. She’s no longer the same person, and Italy won’t be the same country.”

Supporting Trump appears to be a losing proposition in Europe, where last summer Europeans thought Trump was only slightly less dangerous to peace and security in Europe than Russia’s president Vladimir Putin. In March a YouGov poll showed Trump with unfavorability ratings of 78% in France, 86% in Germany, and 80% in Italy.

On Wednesday, April 15, Treasury Secretary Scott Bessent said the U.S. would not renew the sanctions waivers that had permitted the sale of Russian oil. Yesterday the administration reversed that, renewing the waiver that allows countries to buy Russian oil and petroleum products loaded through May 16. The sale of oil provides a financial lifeline for Russia in its war against Ukraine.

Last night in Kansas, former secretary of transportation Pete Buttigieg, who is speaking across the country in support of Democratic candidates, explained to an audience why he is working so hard to restore American democracy. He said: “[W]hen you have one of those long nights, when you’re asking yourself, can I really do any more that I’ve already done? I want you to reach into whatever is your personal why.

“For me, the reason I make sure to hit the road and be with you on a night like this is actually, ironically, the very same thing that makes it a little bit harder than it used to be. When I woke up this morning before I headed to the airport, about 6:30 this morning, as usually happens, my first interaction was with a four-year-old boy. And I’m putting out the cereal for him and his sister. And he says, ‘Papa, can I come with you? On this trip?’ I said, ‘Well, I don’t think it’ll work out. I gotta go to Kansas. You gotta go to preschool, and…’ And then he walks up to me with, um, a Sonic the Hedgehog walkie-talkie. He tells me to put it in my briefcase. He says, ‘Take this with you. That way we can talk to each other.’

“I wasn’t sure whether I should explain how range works on walkie-talkies or not. Just gave him a big hug instead. But what I know is that it won’t be so long before he and his sister, who right now are asking me questions I can handle—like, the other day, I got: ‘Papa is a grapefruit bigger than a pineapple?’ I can handle that. But,what am I gonna do when they say, ‘Papa, back in the 2020s, did you do enough?’

“They’re gonna ask that, and I want to make sure we have a very good answer by the time they’re old enough to ask that question.”

Friday, April 10, 2026

On Our "Virtual Route 99" (Special Friday Edition): On #IranWar Watch & Other Thoughts

 


Gulf Funds Recalibrating American Investments, Including Backing for Paramount Merger, as Iran War Rages On

Financing underpinning the artificial intelligence bubble is also on the table for reconsideration, sources told Drop Site.

 
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The Dubai skyline with the landmark Burj Khalifa skyscraper a smoke plume rises from an ongoing fire near Dubai International Airport on March 16, 2026, as Iran kept up its Gulf attacks. Photo by AFP via Getty Images.

Gulf sovereign wealth funds are undertaking a sweeping review of American investments, driven by a combination of commercial necessity and political recalibration driven by the Iran war, according to sources familiar with deliberations around the high-level financing deals.

In particular, the planned merger between Paramount Skydance and Warner Brothers Discovery, made possible as a result of Gulf financing, is getting a new look. A postponed meeting of the board of the Qatar Investment Authority will reconvene within the next week as the fund recalibrates its investment approach, a source with knowledge of the deliberations said. “Even from a purely, purely numbers perspective, you have to look at this again,” said the industry source, asking for anonymity to speak freely about investment matters rarely discussed publicly.

No announcement from the meeting is expected, the source said, as the Qataris are unwilling to unilaterally back out of the deal without Saudi Arabia also doing so. Withdrawing from the deal would be seen as a political shot against both Israel and the United States, which Qatar feels it can not undertake alone under the current circumstances.

The merger between the two media conglomerates was announced on February 27, 2026. The next day, the U.S. and Israel launched a surprise attack on Iran, which responded, as promised, by attacking Gulf countries hosting U.S. bases. Those same Gulf countries are the primary financial backers of the merger, according to documents on file with the Securities and Exchange Commission. Wealth funds connected to Saudi Arabia, Qatar, and the United Arab Emirates pledged $24 billion to back the deal, which cost nearly $111 billion.

Under the current scenario, the Paramount deal remains likely to go through, but that could change if the war goes on for another month or longer and Gulf oil and gas assets come under even greater attack. Trump has turned his attention to Iran’s oil infrastructure, and Iran has pledged to retaliate by targeting Gulf oil and gas assets in response. Yet even the current circumstances are forcing a deeper look at the entire suite of deals in the sovereign wealth funds’ portfolios. A Paramount spokesperson declined to comment. Spokespersons for the Public Investment Fund (Kingdom of Saudi Arabia), L’imad Holding Company PJSC (UAE), and Qatar Investment Authority (Qatar) did not respond to requests for comment.

At risk is the heart of the U.S. economy, which is currently fueled by the growth of AI companies and the data centers that power them. Harvard economist Jason Furman calculated that more than 90% of GDP growth in the first half of 2025 was driven by AI and related investments. Much of the data center buildout is powered by Gulf financing, while U.S. companies are also building out heavily in the Gulf.

All of that is now uncertain. “The story is not just deals specifically, but if you look at all the AI data centers and all that growth that’s coming in the next few years, where’s most of that capital coming from?” he said. “A lot of it is coming from the Gulf. And if the Gulf—not politically, but even just from a financial perspective—cannot commit that, what’s the knock on effects on those companies and the U.S. economy? I don’t think anyone has done that math, but there is something there absolutely.”

“Hyperscalers”—referring to major companies like OpenAI—“are fine, those guys are huge, they can afford it, but what about the next level?” he said, referring to a sweeping class of companies that could go under without Gulf support.

A second source with close relationships to key Gulf leaders said that Gulf countries are looking closely at all of the deals that have struck, given the new financial realities at play.

In early March, the Financial Times reported that Saudi Arabia, Qatar, the UAE, and Kuwait were collectively reviewing investments with an eye toward canceling some, citing a Gulf official. “A number of Gulf countries have begun an internal review to determine whether force majeure clauses can be invoked in current contracts, while also reviewing current and future investment commitments in order to alleviate some of the anticipated economic strain from the current war,” the official told the FT. “Especially if the war and related expenses continue at the same pace.”

The war and related expenses have not merely continued but accelerated. The industry source said that divestment would likely happen quietly, but it was an inevitability. “Just mathematically, it will have to happen,” he said. “I don’t think it will be obvious, I don’t think it will be messaged that way. But I think it will just happen. And then as things build up again, then people are gonna wonder, if it’s the same people that are involved now or later, you’re gonna question, are they gonna do the same thing again? Are they gonna think about diversifying? That’s the question.”

Gulf investors, he said, “just won’t be able to do the scale they were committed to.”

Paramount is run by David Ellison, the son of Oracle founder Larry Ellison, one of the world’s wealthiest men and the largest donor to the nonprofit Friends of the IDF. Larry Ellison put up billions to cover his son’s merger with Warner Brothers. The Ellisons bought Bari Weiss’s The Free Press and handed her the reins to CBS News, driven by David Ellison’s admiration for her support for Israel. Weiss has cheerled the war, disturbing journalists in her newsroom, even as it threatens her patron’s media empire. The acquisition of Warner Brothers will also give Ellison control of CNN.

Ultimately, even if QIA’s preference in the end is to exit the deal, the fund will stay in unless Saudi also departs.“It’s not a Qatar decision. It’s not a Saudi-UAE decision. It’s a Saudi decision, because all three countries have to commit for the deal to make sense, unless you can find other investors from Asia,” the industry source said. Chinese wealth fund Tencent had previously been involved, but dropped out so that the transaction would not have to undergo U.S. federal scrutiny on national security grounds.

The most likely outcome of the upcoming meeting, the industry insider said, will be for the fund to continue a wait-and-see approach, knowing the political and economic situations are rapidly evolving. “If Saudi goes in, Qatar will follow. If Saudi doesn’t go in, Qatar won’t follow, they’ll just delay, delay, delay, and see what happens. Everyone can still say, ‘No, no, we’re committed, we’re committed.’ And there’s a million ways, if this continues another month, you could force majeure, you could do whatever.”

A Qatari source with insight into the process also said that the deal was still heavily likely to go through.

Trump’s decision to humiliate MBS publicly has thrown a wrench into the relationship with Saudi Arabia. At a Saudi-backed investment conference, Trump riffed on his relationship with the crown prince. “A short time ago we were together and he looked at me and he said, ‘You know, one year ago you were a dead country. Now, you’re the hottest country anywhere in the world,” Trump said. “He didn’t think this was going to happen. He didn’t think he’d be kissing my ass, he really didn’t. He thought it’d be just another American president that was a loser with a country that was going downhill, but now he has to be nice to me. You tell him he better be nice to me, he’s gotta be.”

At the same conference, Saudi’s wealth fund announced a 15% cut in capital investment.

Trump ally Steve Bannon piled on. “Maybe we can get a couple or three of those princes in uniform,” he said on his podcast, The War Room. “Got any kids in special forces? Let’s line up those royal families and see how big they’re talking.”

The insult has contributed to the air of uncertainty surrounding the Paramount financing, the industry source said. “Look, that thing that happened a couple days ago is not a small thing. I mean, we know MBS. That was a pretty insulting move. I don’t know if the word’s ‘petty,’ but he’d be willing to move drastically based on emotions,” he said.

He said that most in the industry were still stuck in a fog-of-war scenario and hadn’t gamed out longterm scenarios. Trump, he said, didn’t seem to have thought things through either, particularly as it related to the president’s promise to supply Europe energy. “The knock on effects are tremendous, because who will supply the LNG and the gas to Europe the next few years? It’s the U.S. But who also needs that gas to grow the data centers? It’s the U.S. So something has to give.” Access to helium, an essential component for the AI industry, is also at risk as a result of the war.

The major players—China, Russia, and even Saudi Arabia—are all incentivized to keep it going, he said.

Saudi Arabia is “not as affected by this war as people may think, their spot prices went up, they, logistically, they’re the hub for everything now,” he said. “It’s making up the difference.”

“If you think about who’s really incentivized to deescalate right now, not many. Iran’s happy for this to continue. Israel’s happy for it to continue. U.S. doesn’t seem to care. It doesn’t affect them. And you have China, China maybe doesn’t want it but Russia is benefitting like more than anybody. So it’s really Qatar that needs to just deescalate for their own security. Kuwait’s fucked. Bahrain’s fucked, but they’re not really players.”












Friday, April 3, 2026

On Our "Virtual Route 99" (Special Friday Edition): On #IranWar Watch & A Window Into The Future