Saul Kavonic

Well, that's right.

So basically, the oil market is now rewound to before the ceasefire and Trump's bombastic ultimatum was made.

So we're back on an escalatory pathway for the conflict and for oil markets, except this time with Trump's blockade of Iran, the remaining one to two million barrels of oil that was still coming out of the strait, which was the Iranian barrels, that's now going to be stopped as well via the blockade.

So it's taken an extra one to two percent off the global oil markets.

Right now, there's no

live fire or war on we're still within this tentative ceasefire period and so there's lower risk of direct attacks on oil infrastructure right now but that could change at any moment

It's the vast majority of the government revenue and the foreign revenue for the country.

The one caveat with that is given the lag times involved in shipments of oil and payments, Iran's likely to still be receiving money from its oil customers for several weeks or even a few months before that actually dries up.

But once it does dry up, it's going to be a massive impact on the regime's revenue and the Iranian economy.

Well, with the blockade, essentially what Trump is doing is making sure Iran feels the financial pain in addition to the rest of the world, which is suffering economically from the weaponisation of energy and the blocking of the Strait of Hormuz.

So before the blockade, we had about 11% to 13% of the world's oil offline.

That increases to 13% to 15% with the blockade in place.

So, look, it's still a massive supply disruption.

And on the demand side, it's equivalent to the demand drop we saw in 2020 in the wake of COVID.

Mm-hmm.

So that's the implied drop in economic activity around the world that would be needed to address this shortfall in oil supply.

The difference in 2026 is the way that drop in activity is distributed around the world will be very different.

That's right.

And I think back during COVID, it was the more developed economies like Australia, which did the harshest lockdowns.

Whereas now, more developed economies like Australia, we actually have a greater ability to pay for fuel.