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U.S. Says Oil Is Pouring Through Hormuz. Trackers Can't Find It.
DUBAI--The Trump administration says large volumes of oil are slipping through the Strait of Hormuz. The trackers whose job it is to count the world's oil shipments see much less.
Energy Secretary Chris Wright said last week the U.S. military had helped ship over 15 million barrels of crude and oil products out of the waterway last Tuesday. He put the average oil exports through the strait over a seven-day period at more than 8 million barrels a day. Earlier this month, Wright said the seven-day average stood at around 9 million barrels a day.
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What’s the truth here? Trump? Serious question.
Then U.S. Treasury Secretary Scott
Bessent said other countries would need to sever business ties with Iran or risk being forced out of the dollar-based financial system? Does he mean the Petro-dollar-based financial system???
But he declined to identify the countries that would be targeted or reveal when those penalties would take effect, saying he would instead provide them time to comply with the new directive. "We are giving everyone the opportunity to remedy bad behavior. Why would I want to blow up the global financial system?" Bessent said at a news conference?
The U.S. on Monday unveiled an expansion of sanctions that it said would cut off Iran's economic lifeline but stopped short of the most punishing measures, instead putting the world on notice to cease doing business with the Islamic Republic.
apple.news
AI Overview:
The U.S. dollar-based financial system is the global network of banks, payment rails, and ledgers centered on the U.S. dollar, and the U.S. can exclude entities by blocking their access to dollar clearing channels and freezing their reserves.
The U.S. uses the
Office of Foreign Assets Control (OFAC) to enforce economic penalties. It excludes targets through specific mechanisms:
- Freezing Assets: The U.S. can freeze foreign dollar reserves sitting in U.S. institutions or the Federal Reserve.
- Cutting Correspondent Access: The U.S. can forbid American banks from doing business with a specific foreign bank. This blocks that bank from clearing any U.S. dollar transactions.
- Secondary Sanctions: The U.S. can punish any global bank or company that deals with a blacklisted target, forcing international firms to choose between the U.S. market or the targeted country.
How It Applies Globally
- Global Reserve Currency: Central banks worldwide hold a large share of their foreign exchange reserves in U.S. dollars, mostly in safe U.S. Treasury securities, to stabilize their own economies and guard against financial shocks.
- Trade Invoicing: Most global commodities—like oil and raw materials—are priced, bought, and sold in U.S. dollars, even when transactions do not involve U.S. companies.
- Cross-Border Funding: International banks and corporations routinely use the dollar to issue debt, secure loans, and move capital across borders due to its unmatched liquidity and network effects.
- The "Exorbitant Privilege": Because the world demands dollars, the U.S. government and domestic borrowers can borrow money at lower interest rates and run larger national debts with less risk of a currency crisis.
If the US actually does this above, or even threatens to do this above, will that throw the whole concept of of the fiat currency & specifically the petro-dollar out the window and into a garbage can in an alley somewhere?
I wonder if this threat above for Iran is going to be used on Canada in the coming weeks or months or days or hours next?
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????????? Anyway, Bessent previously urged cooperation from China, the biggest buyer of Iranian oil for several years, although the U.S. blockade of Iran's ports, renewed in mid-July, has already
cut Iranian oil flows to China.
Experts say Washington is wary of Chinese retaliation for any sanctions on its banks ahead of expected talks next month between U.S. President Donald Trump and Chinese President Xi Jinping, with any curbs on China's exports of critical minerals especially sensitive.
The U.S. on Monday unveiled an expansion of sanctions that it said would cut off Iran's economic lifeline but stopped short of the most punishing measures, instead putting the world on notice to cease doing business with the Islamic Republic.
apple.news
Maybe the US under Trump doesn’t have enough wars going on already that they need to look for some more? Asked about Chinese banks on Monday, Bessent said, "We want to make clear here today that no one is above the reach of U.S. sanctions."
The Chinese Foreign Ministry said sanctions and pressure tactics do not help and Beijing would do what was necessary to protect China's interests. Good times.
