Russia’s Ukraine War Lessons Are Hitting the Gulf

Qatar and Persian Gulf Region on a Map | Photo licensed by Envato Elements

Russia is taking what they’ve learned on the battlefield in the Ukraine War and sharing that with Iran. This is not a new strategy for the Russians, but it is already spelling trouble for the US.

Iran’s Shahed deployment and targeting are improving, thanks to tactics like launching swarms of drones with varying flight paths. These strategies are rapidly exhausting missile defenses in the Persian Gulf.

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Transcript

Okay. Today we’re going to talk about drone targeting specifically in the context of Iran. And there Shaheed. So last week we learned, you know, shocked anyone who’s been paying attention that the Russians have been providing the Iranians with targeting information since the beginning of the war. The Russians have been providing all of America’s foes with targeting information, going back to the early days of the war on terror. 

That’s not a surprise. But what’s come out in the last 24 hours, roughly, is the degree to which the Russians are sharing their war lessons that they’ve learned at the expense of the Ukrainians in the Ukraine war. So the weapons system in play is an Iranian shaheed. It’s a really stupid drone where you have a small Nand chip that’s a slow memory chip that doesn’t necessarily require power to hold on to its memory. 

You program in a preset parameter preset flight route and it flies from A to B following the course you’ve identified. And then if it’s a really advanced shithead and most of them are at it, then can execute a very limited decision tree. Like is this a car or is that a boat? Is that a tree or do I want to hit and it’ll try to hit one of those things. 

Otherwise it just kind of angles down and crashes into something. Well, what the Russians have learned is that if they take their heads and fly them in groups in batches, that, not only ensures that one of them will get through air defense, it makes it actually harder for the air defense to pick out an individual target. So oftentimes you have to fire more interceptors than you would if they just came at you one at a time. 

The additional thing that the Russians are sharing is kind of a weave strategy, because you can preprogram in the route. What you do is you preprogram in a slightly different route for each head. So they kind of weave in and out of formation up, down, left, right, whatever it happens to be. That makes it much harder for air defense to kind of get a lock. 

And you have to use even more interceptors. And we now know that that specific strategy that they developed for dealing with Ukrainians has now been applied to Iranian showerheads that are being used against American and allied targets in the Persian Gulf. The issue here, of course, is pretty straightforward and short term. The western Gulf is running out of interceptors, and anything that forces the defenders to use more and more of them while the shitheads just keep coming, means that the time where they actually run out of Anti-drone weaponry is coming upon us very, very quickly, perhaps as little as a week or two. 

We don’t know the specific number because the Western Gulf is are consider the number of interceptors they have used and the number they have left to be national security secrets. So it’s kind of a just a guessing game. But there were only about 2000 of them total at the beginning of the war. Or it’s been going on for two weeks. 

And we know that the Iranians have fired at least 2000 shitheads at this point, probably closer to 3000. And they just keep coming. So we’re very close to the point where the Western Gulf is going to run out of defensive firepower and courtesy of the Russians, they’re going to have pretty good targeting information. Just come on in and hit whatever they want.

The U.S. Dollar: Short vs. Long Term

Photo of US dollar

Before anybody asks, no, the following is NOT financial advice. The U.S. dollar is constantly in the spotlight, so where is it heading?

Over the long term, the U.S. dollar is well-positioned to rise. Four main factors are driving this: U.S. naval dominance to secure global trade, favorable demographics, abundant food and energy resources, and the need to expand manufacturing. Each of these suggests durable economic strength.

But in the short term, current policy is driving the dollar downward. Before the Iran war, things like immigration limits, tariffs, regulatory uncertainty, and eroding business confidence all weakened the dollar. The Iran war has brought a temporary lift, albeit a marginal one, as investors seek safety.

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Transcript

Hey all, Peter Zeihan here coming to you from Colorado. Today we’re going to talk about the US dollar and where it’s going to go short and long term. Again this is not not not investment advice. This is just where the geopolitics say that we’re going. First let’s talk long term because it’s a really simple story. As a rule, a country’s currency tracks its economic strength and its durability. 

And by that measure, the United States dollar really has nowhere to go but up for the next several decades. The big factor is, number one, the US military is the one that rules the seas. And even if everybody else were to put their militaries together, their navies together, and sail them against the United States, we’d probably only need two, maybe three aircraft carrier battle groups to take the whole thing down. 

Also, with very, very, very few exceptions, single digit exceptions, there are no ships, frigate navies, ships out there that have the capacity to even reach the United States. So the United States can go there, do whatever it wants, but nobody can come here. And that allows us to be the arbiter of really whatever it wants to be. Number two, demographics. 

As much as we are facing a demographic crunch at the moment, specifically is the baby boomers, which are the largest generation we’ve ever had, are now almost entirely retired. Our boomers had kids. We call them millennials, and they are now in the height of their consumption years. And then for the next 20 years, they’ll be at the height of their production years. 

And so we know we still have a relatively strong, stable and balanced economy moving forward that doesn’t exist in very many places elsewhere in the world. So whether you’re in Germany or China or Japan or Korea or Spain or Italy or Poland, we’re looking at a country where they basically already aged out. 

And there aren’t a lot of people under 50 relative to those over 50. So you know that the United States is really the only first world country of size, with the possible exception of New Zealand, where there really is a demographic story for normal economics going forward for the next several decades. Number three, resources. The United States is the only first world country with the exceptions of Australia and Norway and Canada, that are massive, not just producers, but exporters of food and energy products, which without those you can’t have a modern system. 

That doesn’t simply mean that cash is constantly flowing into the American network. It means that the United States never really has to worry about the building blocks of what it takes to make a modern economy functional. All right, what else? 

the last item is kind of, strength from weakness. Because of globalization, the United States is hollowed out a little bit when it comes to manufacturing. We still produce the most value out of manufacturing of any country in the world. But as the Chinese are facing demographic and geopolitical pressures and eventually will fade away, the United States needs to expand its manufacturing footprint massively, at least double it in order to prepare for that circumstance. 

That’s an inflationary story, but it’s also a massive growth story. So those four things together, the need to expand the manufacturing plant, the commodities position, the military position, the demographic position. This tells me that the US dollar has nowhere to go but up for decades. But that’s then, we all live in the now, and we have a lot of problems in the short term that are taking us absolutely the opposite direction. 

And all of those are caused by policy. So first up, the Trump administration’s decision to basically make immigration into the United States impossible. We have gone in the last 12 months from the first world country with the fastest growing population to something near the bottom. And for the first time in American history, 2025, we actually saw the US population drop. 

That is putting huge pressure on labor markets, especially when it comes to things like construction and health care that are slowing American growth, raising costs and pushing the dollar down. Second, the tariff policy, despite what it claims, it’s actually making manufacturing a lot more difficult in the United States. You see, there’s kind of two broad categories of manufacturing. 

Your relatively simple value add, like things like, say, furniture or making glue where there are only a half a dozen steps. And if you have a high flat tariff, you try to then move those steps into your country and consolidate. But then you have more complex manufacturing, like cars and computers and airplanes that have hundreds, if not thousands, if not tens of thousands of steps. 

And there is no country in the world where those are all under one roof. So if you put a high tariff in, then every intermediate good has to pay the tariff and it just makes more sense to move as many of those steps outside of the tariff umbrella as you possibly can, and then just import the finished product at the end, because then you only have to pay the tariff once. 

So what we’ve been seeing over the last year is industrial construction spending in the United States. Drop drop drop drop drop drop drop drop drop. And the only reason it hasn’t plunge is people are hoping, praying against all odds, that the Trump administration will eventually back down and these tariffs will go away. We’re now coming up on a year since they were put in place. 

We’ll hit that anniversary in the first week of April and we’ll probably see the drop off accelerate. So that boom, I was talking about where we needed to double our industrial plant. We’re actually going in the opposite direction right now, and that is forcing the United States to import to cover everything. And so we see the dollar going down. 

The third issue is how easy is it to do business in your country? The Republicans have traditionally been the pro-business, low regulation crowd, and the Trump administration has said that it’s not going to enforce the regulations that are on the book. It’s basically asking companies to lie on their tax forms and ignore the government’s policies as they currently stand. 

You see, there’s a big difference between Trump two and Trump one. In Trump one, they brought in people who knew about deregulation, and they had this idea that for every new regulation that came in, five had to be removed. And so we actually saw meaningful deregulation. But with this new administration, they haven’t brought in those people. 

They’re just not allowing new regulations to go in. So the old regulations from previous administrations are still there. And the people who would go through and winnow them out are not there. And we no longer have the capacity to implement new ones. So the regulatory structure is becoming slowly ever more divorced from the economic realities of the country. 

And there’s no one in place to fix that. So companies are being asked to just ignore the whole thing and saying that there won’t be any legal repercussions for that. At the same time as the, the legal structure becomes almost irrelevant to where we are now. On top of that, with the tariffs, we’ve now had over 5000 tariff changes since April 2nd of last year. 

The the game board is changing every day and companies literally don’t know what to do. And the collective decision is to try to do as little as possible. So while the rhetoric may say one thing, this is actually the most anti-business administration that the United States has had in my life. And business confidence and business activity and business expansion are all dropping instead of rising. All of those are bad for the dollar. 

And finally, there is a rule of law problem. The Republican Party is not what it once was. Donald Trump has exercised a number of factions national security securities, fiscal conservatives, business conservatives from the coalition and has actively campaigned against their champions in Congress. And what’s going on with Immigration and Customs Enforcement is a real big issue. 

Seeing Ice in places like Minneapolis has really jarred the business community, because they’ve always counted on the US government to enforce rule of law. We don’t have that anymore. In fact, Ice is operating in a way that every police chief has always told his or her officers to never do. You know, you’re never supposed to argue with the judge. 

You’re never supposed to argue with the prosecutors. You’re never supposed to recruit from gangs. You’re never supposed to wear a mask. You’re never supposed to draw a gun first. And no one really knows where federal law enforcement is going to be unless you’re looking at the FBI under a guy by the name of Cash Patel, who’s basically a conspiracy theorist. 

So the idea that there’s this stable structure undergirding everything that the federal government does is now gone, and businesses just don’t know how to react at all. You add in record deficit spending and the implications for the dollar are down, down, down, down, down. So we kind of have this perfect storm in the short run that is pushing the U.S. dollar down, even against the overarching long term trends that are pushing the dollar up. 

So I have no doubt that over decades, the dollar will rise and continue to. But I also have no doubt that over months the dollar will drop because the federal government is now actively, loudly declaring that that is their express goal. Now, the idea behind what the Trump administration is saying about dollar policy is their idea is that if the dollar gets weaker, then U.S. exports will increase. 

And ultimately, that’s one of the metrics that Donald Trump is obsessed with. But that also means for a country that imports manufactured products, it also means that we are looking at significantly higher inflation as a result of that policy in the short run. So short run, if you’re a dollar bull, it’s going to be a really rough ride if you’re a consumer. 

Things look a little rough because we’re seeing fewer products produced in the United States, and we’re seeing a hollowing out of the high end employment base that does the high end manufacturing that we’ve always excelled at. That might make good for exporters a little bit, but in the long run, we’re looking at a very different economic structure. And of course, as with everything, the challenge of getting from here to there is where we all live. 

And now an update. We’ve recorded this video before the Iran war started, and if you want to talk about something that threw a shock into the system to underline that there really wasn’t an option out there for financial investment. Outside the United States, this is what did it. And so we’ve seen the United States dollar rise over the last couple of weeks versus every major currency except for, I think, one, I think Canada is holding in there because it’s basically integrated with the U.S. system. 

However, I will underline that, markets are behaving grudgingly in this regard. They really don’t want to put their money in the U.S. dollar because of some of the policies that we have out of the Trump administration right now. So while, yes, the US dollar is rising versus pretty much everybody, only at a moderate pace, in most countries it’s 2% or less over two weeks of war. 

And now the Persian Gulf being shut for the entire time, it should be double digits. But there’s really only three markets where you’re seeing more than this 2% change. You’ve got Korea, which is uniquely exposed, South Africa, whose economy has always been really, wild and, erratic. And Indonesia, where the markets are relatively illiquid for a market of its size. 

So, yes, we are definitely looking at the long term effect here of the US dollar having nowhere to go but up. But also we’re seeing the damaging effects of the short term of no one really trusting to put their money in the United States system and showing that it has nowhere to go but down. The result is, at the moment, in a moment of global crisis, surprisingly small gains for the US dollar. 

I would love to say that the surprises me. It does not.

The Shield of the Americas

Silhouetted soldier against a black background

Trump has launched a new regional security initiative called the Shield of the Americas. This partners with several Latin American leaders that Trump likes to target drug cartels throughout LATAM.

The U.S. would utilize special forces and intelligence teams to carry this out. While they could target cartel leaders, labs, and trafficking nodes, as long as there is demand in the North, the drug trade will persist.

Eliminating the industry would require massive troop commitments, resulting in significant political consequences. And even then, the drugs would find a way to keep flowing.

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Transcript

Hey, everybody, Peter Zeihan here. Coming to you from Colorado. And today we’re going to talk about what went down to the white House over the weekend. 

Specifically, there’s this new grouping called shield of the Americas that Donald Trump has initiated between the United States and a number of Latin American countries that he considers ideological allies. So, by the way, that the Latin Americans use the term further to the right, so not including Colombia or Brazil, but concluding places like El Salvador or Trinidad and Tobago or Argentina. 

Keep in mind that what means left and right in Latin America is a little bit different from what it means here in the United States, but the Trump administration has not picked up on that. Bygones. Second that to all of these governments, just like any other democracy, switch back and forth. So this is an alliance, an alignment of the moment. 

And first thing, you should not count on the current roster of countries being what is there tomorrow or the next day, or much less the day after. There are always elections going on. We won Columbia this summer. That is probably going to be quite significant. 

And so the roster moves. But what is more important about the Shield of Americas, is not so much the Secretariat or any idea of policy. There’s no talk of trade deals. It’s all all about security cooperation. And the idea is that the Trump administration has decided it wants to take the U.S. military, push it into Latin America specifically to go after drug smuggling organizations. Now, back story. Historically speaking, the United States involvement in Latin America has been somewhat limited unless there is a third party from out of hemisphere operating the whole concept of the Monroe Doctrine is it’s not so much that this is our hemisphere, but it’s certainly not your hemisphere. 

So whether it was the Germans or the Soviets or the Chinese or whatever, there’s always been a degree of built in American hostility to anyone on the outside pushing in here. That doesn’t necessarily mean that the United States is dominant economically, although there are periods in the history where that has happened. Second, with the United States is in the process, independent of Trump, exemplified by Trump of contracting its footprint and its interests in the Eastern Hemisphere. 

Now we can have a conversation of whether that’s smart or not, but politically, it’s very popular on both sides of the aisle to bring the boys home and to be less involved in trade on a global basis. I would argue that’s mostly self-defeating, and guarantees will get drawn into something bigger later. But, you know, I’m only one guy. 

If 330 million of us, my vote isn’t all that big. What it does mean, however, is that if you take the United States military and all of a sudden it’s not obsessed with the Eastern Hemisphere, and a lot of the forces come home, and of course, it’s going to be used more aggressively in the Western Hemisphere. And since there’s no country in the Western Hemisphere that’s even remotely capable of fielding a force that is of any conventional threat to the United States, then the question is, what are you going to use the tools for? 

They may have been designed for Islamic fundamentalism or the Chinese army or whatever it happened to be, but if they’re here, they’re going to be applied to different threats. And the threat of international drug trafficking organizations is obviously a significant one that everyone agrees is a problem. We just all agree on what to do with it. I would argue that the simple way to destroy all of these organizations overnight is just just not do cocaine. 

But again, I’m only one vote of 330 million. So we now have the Trump administration and at least 14 other governments, at least on the surface, agreeing to deploy American forces throughout the hemisphere to combat these cartels. Now, two things. Number one, as I said originally, the roster is going to change. And so you’re going to see a lot of small bases and coordination facilities popping up and then going away after an election and then popping up again after the next election. 

And that means we’re not talking about a regular army, and probably not even the Marines, because the type of permanent footprint that’s necessary for those two institutions is in the billions of dollars of investment. And you can’t just come and go and come and go and expect it to be useful at all. It takes months to deploy the Army in a meaningful way. 

Marines a little bit faster, but not by a lot. This is not a job for the Navy and aircraft carriers. This is much more specific. Once you limit what you can do with bases, and that means facilities that are small. And then if they get folded up tomorrow, it’s no big deal. Which means that the entire American deployment for this sort of thing is going to be special forces, whether it is the Green Berets or the Rangers or the Seals or the CIA. 

Now that community, the Special Forces community, has more than doubled the number of operators they’ve had as an outcome of the war on terror, because you never knew where you needed to drop in a small team of a dozen people. Now that the war on terror is over, I don’t want to say that the Special Forces Command has nothing to do, but they’ve gone from having a long grading war where they’ve been working in tandem with over 100,000 Americans deployed in combat situations, throughout the Middle East to all of a sudden that’s gone. 

And so they have become the premier force for the American president, whoever that happens to be, to address whatever issue happens to be coming up in the world or to a degree, deniable, they’re small, they’re agile, they’re lethal, they’re very skilled. They have a long logistical tail. But that means that at the point of the spear is a lot of force behind it. 

So when you look at things like Latin America, you think of drug cartels. This is really the perfect tool for the job, independent of the fact that it’s twice as big as it used to be. It depends on the fact that they’re actually very good at what they do. The only problem, and it’s not a really big one from my point of view, is that they’ve been training for something else for 25 years now. 

There’s not a lot of desert territory in Latin America where there’s drug trafficking. You’re talking primarily mountains. You’re talking primarily jungle or jungle mountains. That means we’re probably going to be seeing the teams deployed throughout the length and the breadth of the region. The question and only Donald Trump can answer this question right now is whether or not you’re going to deploy them exclusively in places where you have a degree of political cover and agreement with the host country. 

In a place like El Salvador, pretty easy. El Salvador is not a major drug trafficking location in places like Colombia, where the government is currently kind of hostile. That’s a different question. As a rule, when Latin American countries realize they have a cartel problem, they’re usually pretty enthusiastic about working with the United States on security matters. But it’s always been a step of remove. 

So, for example, if you look at Plan Colombia, which was the deal we cut with the Colombians in the early 2000, we shipped a lot of equipment, we provided a lot of Intel work. We provided some naval support, but it was always Colombian boots on the ground doing the actual grunt work. And in doing so, it ended their Civil War and led to a collapse in cocaine production. 

You’re not going to do that with ten special forces teams. You can go after specific nodes. You can go after specific production sites, you can go after specific people. But we’re talking about an industry here. The drug industry gets tens of billions of dollars. And as long as there’s demand north of the border in the United States for these products, special forces are not going to be able to change the math to a huge degree. 

That’s the second problem. The third problem is really much bigger. And that’s Mexico, in Mexico, with the current government in Colombia. Shame bomb. We have a government that is much more willing to work with the United States, even in the United States, as being a bully. But you’re talking about where the cartels, the big ones, originated. 

And while they are in the process of fracturing because their leaderships have been removed, all of the economics that are still pushing the cocaine north are still there. And so you’re talking about having to do something like not special forces, but actually deploying tens of thousands of troops in order to impose a security reality. Here’s the thing. We’ve tried that if you go back to the Afghan war, at its height, we had 90,000 troops there. 

And while they were trying to hold the country together to fight the war on terror, heroin production increased. Because you can only be so many places once Mexico is over twice the size of Afghanistan, Mexico has over twice the population of Afghanistan. And so even if we were to put a couple hundred thousand troops in Mexico, I really doubt it would be enough to change the overall economics of drugs. 

Anyway, bottom line of all of this is, while the United States can’t solve these problems, as long as there is an insatiable source of narcotics demand, it does have some tools that allow it to interfere in the region in a really deep piercing, meaningful way. The question is whether or not the political and economic side effects of that are worth the perceived benefits. 

Mild disruption of cocaine production, transiting versus breaking the political relationship that allows, say, the trade relationship to happen. Because Mexico is by far our largest trading partner and will be for the remainder of my life, and without them in the American trading network, everything we need to do gets a lot more difficult.

Sweden Grabs Its First Shadow Fleet Vessel

Swedish flag on a boat

Sweden has seized its first shadow fleet vessel. They even went after a bulk carrier rather than a tanker. As more countries join in on the crackdown on Russia’s shadow fleet, the dominoes are beginning to fall.

There’s a good chance that the entire shadow fleet could be dismantled within the next weeks and months. However, there are over 1,000 ships, so there isn’t enough port space to bring them all in. Expect to see these aging vessels parked off the coast before they can be shipped off to India or Bangladesh to be scrapped.

Beyond the obvious impact on Russian, Iranian, and other oil supplies, global shipping could shift into a shortage as the vessels are retired.

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Transcript

Hey everybody. Peter Zeihan here coming to you from Colorado. Today we have to take a break from what’s going on in Iran and look further north to Sweden, of all places. The Swedes over the weekend have brought in a Russian shadow fleet vessel into their ports and basically have arrested the crew. This is interesting for a number of reasons. 

For number one, we’ve had a couple of dozen shadow vessels be captured by various powers the United States, India, France, Belgium. This is the first for Sweden. And so we’re seeing a broadening net, of countries going after the shadow fleet, which is basically what the Russians have been depending upon in order to ferry things that are under sanctions around the world. 

Second, beyond this being Sweden’s first one, this is the first shadow vessel that wasn’t a tanker. It’s a bulkier. And it’s unclear whether it was carrying cargo from the Middle East to Russia or stolen Ukrainian grain from Ukraine to Russia to somewhere else. Really? Doesn’t matter specifically. The point is, is that the entire shadow fleet, not just the tankers, everything that the Russians have been relying upon to maintain their reach beyond their own territory is now under direct threat. 

We will probably see a complete dismemberment of the Shadow Fleet over the course of the next several weeks. And now that we have countries as minor as Belgium and countries as well placed as Sweden going after them, because Sweden basically controls the Baltic Sea if it wants to. This should wrap up pretty quick. We’re now in a weird little situation, though, where there’s going to be a logistical issue that’s really big. 

The shadow fleet is over a thousand ships, and there are not enough port facilities in the world to take them all. What will probably happen at the end of the day is they’ll all end up eventually in a place like Bangladesh or India. Well, they will be broken down for their steel. All of the Shadow fleet vessels are old. Most of themcould not qualify for a normal insurance policy under normal circumstances. And it’s only because they’re operating functionally illegal under the Russian banner, that they are still afloat. But as logistical problems go, that’s a really good problem to have. So in the meantime, they’ll probably dropping anchor off places until they can be unloaded, but that will absolutely take weeks to months. 

So we are at the beginning of the end of the process, and now we can start looking to the other side, where we go from having a surplus of vessels in the world to a shortage of vessels in the world, and where we have Russian crude and Iranian crude and Venezuelan crude, and perhaps Saudi and Emirati and Kuwaiti crude all falling off of the market at the same time. So what was for me really dramatic when this started to happen about a month ago now with the Iran war, who I don’t want to say it’s a rounding error, but this is definitely the lesser of the two big things going on, and it’s all happening at once. So buckle up.

The Iran War: Enter Sting Interceptors

Drone-intercepting Sting drone being prepared for launch | https://commons.wikimedia.org/wiki/File:Sting_drone-interceptor_being_prepared_for_launch.png#/media/File:Sting_drone-interceptor_being_prepared_for_launch.png

Defenses in the Persian Gulf are collapsing as Iran continues large drone attacks, but there’s a country that already has the answer. Enter Ukraine’s Sting interceptor.

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Transcript

Hey, everybody. Peter Zeihan here coming to you from Colorado. It is late on the 15th of March, giving you an idea of what’s happened over the weekend in the Iran war. A few big developments. Number one, it’s very clear that Kuwait and the United Arab Emirates are almost entirely out of interceptors. And we’re seeing more and more shots getting through to that. 

And the Iranians have warned citizens of the UAE in the vicinity of military facilities and ports to move, because it is the Iranian intent in the next few days to basically destroy all of them. Judging from the number of drones that are still coming out, I don’t think they can destroy all of them in that kind of timeframe, but they can certainly wreak immense damage, especially to the energy infrastructure. 

So we’re now at the point we’re seeing the act of disassembly, if you want to use a less horrible term, of the physical infrastructure up and down the Gulf. And when they’re done with the UAE and Kuwait, they will obviously focus on gutter. In Saudi Arabia. We’re also seeing reports that Israel is almost completely out of, interceptors as well. 

And the United States does not have a replacement stock to help with any of the countries, the Trump administration, Donald Trump personally, I should say, has, taken to Truth Social to start demanding that other countries start sending warships to attack Iran. Gone is the bluster that, oh, the war is completely over, and it’s just a matter of tying this up. 

I mean, that was always really stupid. Now it’s being peeled back for the ridiculousness that it is. Specifically, Donald Trump has called upon the Japanese and the Koreans to send ships. A few things here. First of all, the Koreans don’t have the range, so it’s going to be very easy for them to ignore that one second. 

Japan does have the range and like the bar for us getting involved in a war that somebody else has started when we don’t have really the military capacity to appreciably, help. It makes it a bit of a stretch. But more to the point, there’s just the time, these are not countries that maintain navies on a wide ranging global patrol like the United States. 

Nobody does. And so if the Japanese did decide to send a meaningful contingent, they would not arrive in the next two, three weeks. That’s assuming they were ready to go right now, which is an open question. So you can just take that little bit of American propaganda and shove it to the side because it’s irrelevant. 

The other big thing is Ukrainian President Zelensky has said that he has provided the United States with definitive proof about how Russia is assisting Iran in the war with the United States. Specifically, he says it’s a combination of Intel programing and hardware, at the moment. 

the white House has been silent about that. And anyone who knows anything about this region of the Russians is going to know that. 

Of course, that was going to happen because the Russians have been doing it for the last 30 years. And just because we’ve had a change in president, that doesn’t mean that the Russians or the Iranians see the United States any different at all. 

What will probably happen is unless we have a significant shift in attitude out of Donald Trump personally, we will probably see the Ukrainians providing that information to the countries in the Persian Gulf that are actually getting hit so that the Kuwaitis, the Qatari, the Saudis, the Emiratis and everybody else understand exactly, how the United States has screwed this up. 

Once that happens, I would expect the Arab states of the Persian Gulf to start spending just immense amounts of cash in Ukraine to massively expand their capacity to build counter, drone weaponry interceptors. There’s something called the Brave One, which is about a foot long. It and its entire launcher fits into a duffel bag. 

According to the Ukrainians and some countries that have bought some, you can make these things for somewhere between 1 and $3000 each, whereas a shithead costs in the 35 to $55,000 range and a Pac three interceptor, the one to the United States is running out of are 4 million a pop. 

In addition, the United States can only make about 700 PAC threes in a year, whereas the Iranians pre-war could make 700 shitheads in a week. And the Ukrainians can probably make several thousand, brave ones a week as well. But they need industrial infrastructure and plant expansion in order to up their production, both for their own defense as well as for any sort of export sales. 

Say what you will about the Kuwaitis, the Qatari, the Emiratis and the Saudis. They’re not particularly good at anything that involves the military, but they have a lot of cash sitting on hand. You got over $2 trillion in sovereign wealth funds, and we will probably now, within days, see a fairly substantial chunks of that dedicated to investing in Ukrainian infrastructure in a way that we just haven’t seen from the Europeans, much less the United States, in the last year. 

That changes a lot of the math of what is possible and impossible in Russia, in Ukraine, in Europe, in Iran, in the Persian Gulf. We’re now in a position where the best chance for preserving the infrastructure to prevent some sort of global calamity, ironically, runs through Kiev, and Riyadh and Doha and Kuwait City. And the rest are going to come to that realization, probably in the next 48 hours. 

One quick correction on today’s video. The name of the drone right here that the Ukrainians are producing that is in high demand is called the sting, not the brave one. Brave one is the tech incubator that Kiev has set up to facilitate innovation across the entire drone and general defense space. So brave one is the institution. The sting is the actual piece of hardware that everybody is after.

The U.S. Helps India and Russia Helps Iran

An oil tanker in the ocean sailing

There have been two major developments involving India, Russia, and the Iran war being conflated. These are two separate issues altogether.

The first involves Trump granting India a temporary waiver to import Russian oil. This was done to prevent a severe energy or economic shock in India. This is a pragmatic move, rather than a pro-Russia policy shift. The second revolves around Russia helping Iran with targeting information. This is a longstanding Russian strategy of undermining the U.S. globally.

Although some U.S. policies toward India appear to be improving, a major shift is unlikely unless and until some of the Russian sympathizers in the current administration are removed.

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Transcript

Hey, everybody. Peter Zeihan here, coming from a snowy Colorado, finally got a big storm. Oh. Anyway, today we’re going to talk about something that a lot of people are conflating that deals with Iran and the oil trade and Russia and India and sanctions and terrorism, blah, blah, blah. A lot of people are tying this all together with a nice big bow. 

It’s not quite that neat. So the two big things, number one, the Trump administration has granted India, a series of waivers, right now, courtesy of the Trump administration. We have sanctions on a few Russian oil companies and, Donald Trump managed to cut a deal with the Indians, about how six weeks ago, I think it’s been now, where the Indians would stop, importing Russian crude. 

I definitely had my doubts about that at the beginning, but it seems like it’s actually sticking because, there’s now this waiver, the issue is that the Indians had been grabbing oil in excess of a million barrels a day. Really? Since the Ukraine war got going, and it was one of the big financial lifelines. 

And now that the Trump administration has put sanctions on Russian companies, they have slowed, not stopped, but slowed. But now, with the Persian Gulf being closed for I believe we are in day ten now, the Indians only other source of crude was from the Persian Gulf, and that has functionally gone to zero. So in order to keep the Indians on board, the Trump administration has granted this waiver, allowing the Indians to bring in, temporarily, at least for a month. 

Russian crude. That’s piece one. Piece two is we’ve had a number of leaks from the international community, especially from the American intelligence services and also from Congress, that the Russians are actively assisting the Iranian government with, targeting of American troops. Which is definitely true. The people that are deeply anti-Trump are, conflating the two saying that, Trump is basically Putin’s, sex toy. 

And so therefore, Trump has been looking for any opportunity to, cut the Russians a deal and absolutely anything. While there may be a little bit of truth behind the thrust of that, linking these two events is not correct. Let’s start with the Indians. If you’re going to split the Indians off from the Russians, if you’re going to have a better relationship between American India, causing an economic depression is not a good way to do that. 

So once the United States started the war in Iran and the Persian Gulf got shut off, your choices were either to try to somehow force India to have, an energy induced depression and then still be pro-American, which would have been a very, very tall order or issue these temporary waivers. So the temporary waivers make a lot of sense. 

I’m not a big fan of the Russians having any market, but if you took the Russians out of the equation at the same time you took the Persian Gulf out the equation, you’re talking like 25 million barrels a day of global oil production that has nowhere to go and can’t get anywhere. And that would have been disastrous if it was all focused on India. 

If you want to focus on China, it’s different conversation, different video. Okay. So that makes sense. The second one, the Russians have maintained links to basically any group that has ever targeted the United States, whether that is various derivatives, Al-Qaeda, Iran, or more specifically, the group in Iran that is calling most of the security shots, which is the IRGC. 

And of course, they’re continuing to provide targeting information just like they did for the 20 years of the war on terror. Anything that keeps the Americans bottled down anywhere else in the world gives the Russians the free rein to do whatever they want in their neighborhood. That is a time honored Russian tradition, going back all the way to the czars. 

So of course, of course, of course they’re doing this, which puts, the Trump administration and Donald Trump personally and kind of an awkward spot. The information is coming from so many sources, international domestic, military intelligence, congressional that, there’s a lot of texture and detail to the accusation. Specific cases have been noted. So of course it’s true. 

And that puts Trump in that position because he is basically giving Putin the benefit of the doubt in everything regarding global affairs and the Ukraine war, and specifically. And now we have his most recent, crown jewel in his foreign policy, Iran, that has been actively undermined by the Kremlin and Putin personally. Does this mean that we’re about to see Donald Trump turn over a new leaf? 

That’s a lot more realistic when it comes to the Russians? Let’s not get ahead of ourselves. Remember, that surrounding him, you’ve got Wyckoff, who was maybe the dumbest person Western civilization, who was the prime interface between Putin and Trump. And all he does is regurgitate Putin’s propaganda in Trump’s presence. 

Number two, you’ve got the vice president, JD Vance, who is a not so closeted white supremacist who thinks that the Russians are the great hope for the white race. And third, you’ve got, the director of national security or national intelligence, Tulsi Gabbard, who basically has stood against the United States on any meaningful foreign policy position for the last 15 years and has been very, very pro-Russian from the very, very beginning. 

The key thing about Tulsi Gabbard is that she controls the daily presidential brief that the intelligence community puts together for the president. So I would be shocked if details about what the Russians are doing even made it into the document in the first place. So this basically has to grind on. We’ve already had a half a dozen Republican senators, and a number of Republican House members go public in the last 72 hours screaming at Trump to finally, finally, finally fix this and get rid of people like Tulsi Gabbard and Steve Woodcock and actually have a foreign policy that is worthy of the United States. 

But as we all know, Trump, really doesn’t care what anyone else thinks. And he’s really not even concerned about the midterm elections because, he’s already a lame duck. And even when he controlled both the Senate and the House, he’s really never bothered going to Congress for anything. So why would he care what Congress looks like? 

Anyway, things are slipping. Bit by bit in the right direction for more realistic foreign policy versus the Russians. And things are kudos to Donald Trump slipping in the right direction for more productive relations with the Indians, as well. I was very doubtful that the Indians would abide by any sort of ban of Russian products. But yet here we are, and the market is proving it. 

Russian Urals crude sold on the Indian market has actually now risen above the Brant benchmark. That is kind of the global standard. And the only way that would be happening is if we had a sudden surge in purchases because of the waiver. And that’s exactly what’s going down. So a lot of moving pieces here, and I’m not trying to convince anyone that we’re about to have a dramatic change in foreign policy. 

That would be more realistic. But we do finally have multiple vectors moving in the same direction at the same time. You will not see a meaningful change in policy, however, until Wyckoff and, Gabbard are gone. I don’t see that as imminent. But then again, Kristi Noem finally got let go after six months of horrible mismanagement at DHS. 

And again, the Republicans in Congress are not so quietly celebrating, in media. So, you know, there is hope here. Let’s just not get overexcited until we actually see the backsides of some of these people who functionally work for the Russians.

Iraq, Oil, and a Break for Chevron

Iraq Map With An Oil Sign licensed by Envato Elements: https://app.envato.com/search/photos/c777eb9c-aa98-4f24-b652-fc6ac6385c3c?itemType=photos&term=Iraq+oil

We’ve all heard the claim that the Iraq War was a war for oil, but American energy firms barely wanted to touch Iraq after Saddam fell. Things might be shifting now.

U.S. sanctions on Russian firms, such as Lukoil, forced Iraq to nationalize projects. This opened the door for Chevron. Should they come in, production in the West Qurna 2 oil field could double.

Once Iraq’s parliament gives the green light, Chevron would mark this as a much-needed win, as it would be the largest recent international asset and comes as the firm could be losing ground elsewhere, such as in Kazakhstan.

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Transcript

Hey, everybody. Good morning from Colorado today we’re and talking about oil in Iraq. If you guys remember back to Iraqi freedom and the Iraq war in the war on terror, you know, 20, 23 years ago now, there is a lot of argument back then from people who didn’t like the George W Bush administration that this was a war for oil. 

We were pre shale revolution at that point. So the US was the world’s largest importer of crude and natural gas. Now we’re the world’s almost largest exporter of both based on how you’re doing the numbers. But if you remember back to how the war concluded, American oil interests moving into Iraq were thin. There were a few people who moved into Kurdistan in the north, and that was about it. 

The reason was a combination of things. Number one, there was an active insurgency going on. And while oil companies generally have a high tolerance for damage, in this sort of environment, when the 100,000 American troops in the country were like, no, that’s just way too hot for us. Second, the Iraqi government, post-Saddam was wildly disorganized, and sharply sectarian and basically on off in a stage of civil war in parts of the country, parts of the country that had oil. 

So a a few companies did move in, but it didn’t really work out for any of them, and they ended up moving out. That may may be changing now. The Trump administration has sanctioned Russian oil companies, most notably Lukoil, in this conversation, and Lukoil was the manager for a really easy, shallow, huge field called West Qana two, which is in the southern part of the country near the secondary capital of Basra. 

And after 20 years of operating in the country, they were able to get oil production there up to about 450, maybe almost 500,000 barrels a day. But now they’ve been sanctioned and they can’t US dollar markets. And if you’re producing crude for export, it’s all denominated in US dollars. So they have basically had to shut themselves out. 

So the field was nationalized by the Iraqi government. It’s currently being managed by something called the Boss Route Oil Company, which is a state entity, and they have entered into negotiations with America’s Chevron to take over the project. Now, none of this is done. There is no ink to even be dry yet, but, Chevron is in the first position to enter negotiations. 

Take it over. And the current expectation we’ll see is that a year from now, they will be the sole operator, or maybe in league with the Iraqi government. This would be the single largest asset that Chevron has picked up internationally in quite some time. Almost a half a million barrels a day. And unlike Lukoil, which doesn’t have great technology or capital access, Chevron is one of the big five of the world. 

And we would probably see the West kind of two project expand to over a million barrels a day in a very short period of time, probably no more than five years. It’s a technically simple field. It’s large, it’s close enough to a population center to be able to tap labor, but not so close to be a security problem. 

And it already has an existing pipeline going to the coast, and it already has an offloading facility. So in terms of supporting infrastructure, everything that it would need is already there. About the only obstacle at this point is would have to be ratified by the Iraqi parliament, which can be a little snarly, and that will depend upon relations with the United States. 

But one of the things that prevented American companies from getting involved the last time around is that the only real stable part of the country was up north in Kurdistan. And so that’s the first place people went to sniff around. Well, Kurdistan is viewed by the rest of Iraq as secessionist. So if you cut a deal with the Kurds in the north, it was very difficult to get a deal on the south, on top of that, the technical challenges for the fields in the North were really, really sticky. 

And if you wanted to get the crude out, you either had to send it north through Turkey. And the Turks hate the Kurds and the Kurds hate the Turks. Or then you had to send it south through the Arab part of Iraq. And they didn’t like the Kurds anyway. So basically anyone who took the early deals with Kurdistan, lost out on the South, independent of the fact that the South was a difficult operating environment. 

But no longer applies today. And Chevron has no assets in Iraqi Kurdistan. So from a geopolitical point of view, this actually seems to be set up to be a meaningful deal for Chevron, which, considering they’re probably going to lose what they have in Kazakhstan because of the Ukraine war, from them is a fantastic development. They’ve always kind of been second fiddle to Exxon. 

This is one of those situations where they might actually have a significant leg up.

Why Would Europe Trust France with ALL the Nukes?

A french flag over the Arc de Triumph

Macron is proposing that France expand its nuclear deterrent to help shield the entire European Union. This comes at a time when Europe is losing confidence in the United States’ security guarantees. But there are major obstacles in the way.

Many European countries could build their own nuclear weapons, and do so quickly. So, why would they rely on France? Would Paris really risk nuclear war for a smaller EU state that was under attack?

Rather than a centralized French nuclear umbrella, proliferation throughout Europe is more likely. Many countries could spin up a weapon within months, so we could be looking at a more heavily armed and fragmented Europe very soon.

Prefer to read the transcript? Click here

Transcript

Hey, all, Peter Zeihan here, coming to you from Colorado. And today we’re going to talk about nukes in the European context. Specifically, the president of France, Emmanuel Macron, wants to expand the French nuclear deterrent in order to provide a missile shield for everybody in the European Union. Right now, because the Brits left the EU several years ago. 

France is the only country in the EU that currently has nuclear weapons. Now, what’s going on here? Is that the French just trying to make a power play to make themselves sound important. You can answer that yes to anything that the French say. That doesn’t mean that there’s not something here. What is going on? Is that, well, to make it perfectly blunt, the Europeans have lost confidence in the United States. 

When the Greenland fiasco happened earlier this year, the Europeans realized that 75 years of alliance was functionally over. And if the United States was willing to threaten its most loyal allies, directly with military intervention in order to get a piece of property that is useless, what will the Americans do when something’s actually important is on the line, like, say, a threat that requires a nuclear strike? 

And so the conversations that are going around Europe are is what do we do? What do we do? What do we do? Part of this means building, much bigger militaries that are independent, the United States. Part of this means fuzing their defense establishments with the Ukrainian one, to put Ukrainian tech and European capital manufacturing capacity to generate an entirely new style of war. 

That leaves both the United States and the Russians out in the cold. And a third layer of it is a nuclear shield. The problem here, what the French are going to run into is that third one is the least feasible of the three because, well, a couple of things. Number one, the technology is not new. Any country that has a nuclear power plant, there’s a dozen European countries like that could relatively easy build a nuke with what they have on hand. 

A one gigawatt nuclear power plant, which is, you know, medium to large size, generates enough waste plutonium every year to make a dozen or so weapons quite easily with technology that was developed in the 1940s. So there’s not a technical obstacle at all. And since the United States is basically no longer enforcing any of its weapons treaties, the non proliferation treaty is one of those. 

And there’s really nothing standing in the Europeans way except for the European sense of propriety. 

which means that nobody has to rely on the French. They could build their own. The second problem the French are going to have is the issue of thresholds. So let’s say, for example, that Estonia, a country with less than a million and a half people way up in northeastern Europe, was under attack by the Russians, and the prime minister was dead, and the cabinet had been strung up in the streets. 

And the deputy education minister, because that’s all that’s left, calls up. The French president says you got to nuke Moscow. What’s the French response going to be like? Maybe. No, that’s not very convincing. So what is more likely to happen is just a mass proliferation process throughout all of Europe. They might coordinate on fighter jets and tanks and drones and the rest, but nukes. 

Every country is going to want their own deterrent. 

Every country is going to want to be able to say yes or no for their own reasons. And that means we should be looking in the next few years for a number of countries that are already very close technically Finland, Sweden, Romania, Poland, Germany all getting their own deterrent, and probably some smaller countries as well, because one of the things that the Europeans like to forget that those of us who know our history, remember, is that, historically speaking, well, almost all of the Europeans have been at odds and at the throats of the Russians and vice versa. 

They also have been at odds with themselves and at the throats of one another. Historically speaking, Europe is the most blood drenched chunk of territory on this planet, and it’s only with the post-World War II settlements where the Americans basically occupied the place for 40 years, that all of these countries were forced to be on the same side. 

And then when the Berlin Wall and Iron Curtain came down, Central Europe kind of rejoined that group under the egis of NATO. And if NATO doesn’t mean anything anymore than the Europeans have to start making decisions for themselves, and a lot of Europeans are going to make decisions that not only the Americans don’t like, but other Europeans don’t like either.

The U.S. LUCAS Rivals Iran’s Shahed

A photo of LUCAS drones courtesy of US Central Command: https://www.centcom.mil/MEDIA/PRESS-RELEASES/Press-Release-View/Article/4347030/us-launches-one-way-attack-drone-force-in-the-middle-east/

The U.S. has a drone that punches in the same (financial) weight class as the Iranian Shahed. Everybody, meet LUCAS.

With a range of ~500 miles, a price tag around $45,000, and modular capabilities, this is the U.S. military’s first step towards scalable and affordable drone warfare. This is still in early phases of production, but plans are in place to ramp that up by 2027.

These systems have already been used to strike Iranian targets, but the extent of the damage is unclear. LUCAS might not shift the trajectory of this war, but with widespread deployment over the next few years, the math of modern warfare could shift drastically.

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Transcript

Hey, everybody. Peter Zeihan here. Hello from Dallas. Today we’re going to talk about drone warfare, specifically, a new weapon that the United States has introduced in the Iran war. It’s called the LUCAS, which is short for a very long item. That basically means really, really cheap drone. In fact, it’s modeled off of the Iranian Shahed, which has a cost probably in the 30 to $55,000 range. 

Right now, what has been released indicates that it’s in the middle of that range, right around 40, 45,000. It’s a modular drone, so you can decide whether you want a warhead, a jamming pod control, a variety of other things. Anyway, this is the United States first entrance into low cost drone warfare. The idea is you’ve got a drone with a decent range 500 miles, which for an autonomous system is pretty good. 

And because it’s made by the United States and not a country like Iran that doesn’t have much of an industrial base, things are being produced at scale. Or at least that’s the intent. And the modularity means that you can mix and match while you’re in deployment mode. So either on an aircraft carrier or by some Marines who happen to be on a beach somewhere. 

You plug in what you want and then send it off. We know that they have been used already in the Iran war to ironically, target drone manufacturing capacity. The Shaheds, it’s unclear whether or not, the targeting just went after the barracks or the depots or the actual manufacturing floor. We just don’t know that. And Centcom has talked a lot about the targets they’ve taken out, but they haven’t yet to mention the manufacturing capacity at all. 

So far, the estimate is that 1500 of these things have been built. And the intent is by at some point in calendar year 2027 for annual production to exceed 10,000 units. Compare that to how many patriots, the anti-missile systems that the United States is known for, can be made that comes out to about 600, maybe 700 a year right now. 

They’re hoping to get that up to over a thousand over the next five years. Here’s the thing about drones. You have a couple of options. You can either have a fiber line, which means you can’t be too far away because you basically have it on a cord, or you have to realize that there’s going to be jamming. And if there’s jamming, you lose control of it, or you program in a decision tree imprinted onto something like a Nand chip, that’s, the memory in your computer that holds when your computer is off, and then it just kind of goes to that specific location, looks around for something that matches its targeting priority, and then drops. 

That’s basically what the Shaheds are with the United States, though, you have a different option because the United States typically has air superiority where it operates and a satellite network. So you can put something like, say, a Starlink transceiver on it, and you can micro adjust it the entire way. And since these things have a range of 500 miles and a lot later in time, about six hours, that really expands your options. 

Now, in this specific war with Iran, there just aren’t enough of them at the moment to make a difference. 1500 total. Not a big deal. The United States hit over 1200 targets in the first 48 hours of the war. But if you fast forward this 2 or 3 years, when a typical American naval asset can have a few hundred of these bad boys on station in any given time, then you’re talking about a very, very different sort of math. 

One of the weapon systems that I was a big fan of that ultimately did not get built was the Arsenal ship. The idea you have something that’s smaller than a destroyer that basically carries a bunch of cruise missiles, 5000 of them, and you just send it out there and blah, blah, blah, blah, blah, blah, blah. This achieves that basic concept at a fraction of the cost, assuming it works. 

Right now we know they’ve been used. We don’t know how well they’ve done, but these are exactly the sort of weapons that we need in this transition phase from going from an old, very, very high cost system to whatever the future of drone warfare happens to look like. And as soon as I find out more, I’ll let you know.

Iceland and Norway Ponder EU Membership

Flag of the European Union

As Trump has been screaming into the void about acquiring Greenland, the wheels over in Iceland and Norway are starting to turn.

Both countries have much of what Donald Trump says he wants out of Greenland: Arctic access, deepwater ports, and mineral resources. And as the U.S. becomes more transactional and predatory, Norway and Greenland are now considering EU membership to add a bit more security.

EU membership would be costly and heavily regulated, but when the strategic calculus shifts as much as it has under Trump 2…moves like this need to be considered. This goes to show how much trust in U.S. leadership is fading (even amongst America’s historically closest allies).

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Transcript

Hey everybody, coming to you from a bright sunrise here in Colorado. Peter Zeihan here. Today we’re going to talk about the Greenland fallout in Europe. Not so much about relations with the Europeans and about how that’s really changed the nature of the relationship. I mean, when your primary security guarantor strikes threaten to invade one of you. That’s a big deal. But instead, the countries that now think that they might be in trouble and are starting to change their strategic policy. 

And that comes down to Iceland and Norway. Norway has about 5 million people. Iceland like one tenth of that, Nordic countries on the North Atlantic that are a little chilly, that have good relations with the Danes and until now, very good relations with the United States as well. But when they look at the things that Donald Trump was demanding, he’s like, we need have Greenland in order to prevent Russia and Chinese from entering the Arctic. 

We need to have Greenland in order to have a port up in the Arctic. We need to have Greenland for the critical materials. We need to have Greenland for the resources. You know, Greenland has almost none of those things, but Iceland and Norway do. And they are lightly populated, especially Iceland, which basically has under three quarters million people, three quarters of them in the area around the capital, Reykjavik. 

The rest of the country is open and there are multiple, multiple, multiple deepwater opportunities. There’s a lot of zones where they know they’ve got minerals, but they have it mined because of the climate and they have a huge access to continental shelf. We might have to do this one later. We’ll see how it goes. And huge fishing reserves. 

If the United States was going to want a North Atlantic bastion on the Arctic, it would absolutely be Iceland. Or maybe even Norway. And because Iceland has so few people, it doesn’t even have an army and has relied upon the United States for its defense. Going back 70, I got two cold. 

Finishing this one up inside. Yeah. So Iceland doesn’t really have a defense force in any meaningful sense because it doesn’t have a population, much less a population that’s capable of controlling its own territory, much less the wider seabed around it. It’s an island in the middle of kind of nowhere. And so what we’re seeing in both Norway and Iceland now is a renewed debate, especially at the parliamentary level, about joining for the first time, the European Union. 

European Union does have a defense clause, but it has no military decision making power. Just basically says that we all hang together, and if somebody threatens one of us, we’re all kind of have a meeting about it and nothing really big, but it puts you in a group with 450 million people, with an economy that’s three quarters of the size of the United States. 

And the idea is that there’s strength in numbers. And now when the rubber hits the road, that might not be worth anything. But if you were Iceland and Norway and you’re currently on the outside of the EU and you’ve been relying on NATO for your security, and by NATO, I mean the United States, and all of a sudden, the United States is saying all of the things that it wants. 

You have, it’s forcing a change in mindset. The primary reason that these two countries have not joined the European Union until this point is cost and regulation. If they joined, they be two of the richest members, and they would be paying far more into the European Union budget that they would ever get back. But if all of a sudden NATO is led by a nation that is predatory when it comes to the Europeans on issues of resources and territory and ports in the Arctic, then all of a sudden, all of the math that they have relied upon for decades has gone out the window, and they need to consider new options. 

The fact that this conversation is even happening is kind of a shock, because even in the depths of the financial crisis back in the 2000, when Iceland was imploding, they still didn’t seriously consider going to the European Union even when they thought they would get money back. So it gives you an idea of how much the mindset has changed among countries in northern Europe that until now were the firmest allies the United States has ever had. 

And all of a sudden, they’re all considering alternatives.