Armenia – Azerbaijan War: Turkey and Iran at Risk

After Azerbaijan’s lightning assault on Nagorno-Karabakh caused ethnic Armenians to flee the region, there’s potential that Azerbaijan will continue to invade Armenia proper.

The motivation for this second phase of the invasion would be to control a land corridor connecting different parts of Azerbaijan. Thanks to Stalin’s chaotic cartography, this region’s power dynamics are just a tad messy. Now mix in some complex geography and bippity-boppity-boo; welcome to the Caucasus.

There is a more significant issue playing out behind the scenes, though. If Azerbaijan is successful in this second invasion, it would place Turkish and Iranian powers within spitting distance of one another. And I can assure you that no one wants to see how that plays out.

Prefer to read the transcript? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
Support medshare's global efforts

Transcript

Hey everybody. Peter Zeihan here coming to you from an exciting hotel room. The news I wanted to talk today is about something that has to do with caucuses again. For those of you who remember a few weeks ago, the Azerbaijanis launched a fair bit of a lightning assault on a place called Nagorno-Karabakh, which is an area that was populated with ethnic Armenians.

And the war was over in less than three days. And pretty much all of the Armenians who were living there have since absconded and left for Armenia proper, where there’s now going to be, it looks like a second phase of that conflict where the Azerbaijanis are likely to invade Armenia proper. What’s going on here is that the Azerbaijanis are looking for a land corridor to connect to parts of the country in order to explain the significance of that and have to do a little bit of screen sharing here to Google Zoom, which was Earth, which is one of my favorite programs ever.

Anyway, here we are looking at where the former Soviet space in the north meets with the Middle East in the South and the Caucasus is this mountainous land bridge in between. And let’s just go through a little bit more, okay. So the northern caucuses or the greater caucuses is this line here very rugged, very steep, home to a lot of ethnic minorities like you would expect in any number of mountainous zone.

This is an area where the Russians have always had a problem. The Chechens, if you remember them, live right here. And then you’ve got these two little enclaves in the north, Abkhazia here in South Ossetia here, where the Russians have sent in troops and basically occupy them and make them de facto Russian territory. And some people would say that the Russians are basically trying to do this in Ukraine as well.

But it’s I think it’s important to understand that for the Russians, it’s all about controlling the access point. So that’s Ukraine, where that’s the worst that they’ve watched here in Abkhazia and South Ossetia. The Russians know that their population is dying out. So they believe that they came forward, positioned troops in the access points that they will have an easier time defending themselves.

So there is a coastal road here in Kasia. There’s a path that links the northeast Russian province, which is part of the Russian Federation with the South Ossetian province, which is part of Georgia. And they’re trying to plug those access points. So you’re going to see a lot of this, whether it’s in Central Asia or the western periphery that is near Europe.

And that actually is kind of relevant to the discussion about what’s going on in this region and where media. Now, here we’ve got the former Soviet Republic of Azerbaijan, the capital here is Baku. It’s got about half the population, the entire place, the former Soviet Republic of Europe, an independent Armenia, is right here. You have the Turks over here and the Iranians to the south know Egypt a little bit more.

And Yerevan, capital of Armenia, Mt. Ararat, is a zone that supposedly Noah’s Ark crashed into as the floods receded. It is the national symbol of Yerevan, of the Armenians, and it is not in their territory, it’s in Turkey, but they can see it. A dominates the skyline from the capital. Nagorno-Karabakh is this mountainous zone over here. This is the area that the Azerbaijanis recently liberated from Armenian control and the caravan, which is right here, is that chunk of Azerbaijani territory that the Azerbaijani would like to physically connect to the country.

And if all of this seems like just cartographic spaghetti, it is. And you can think Joe Stalin for that, because at the time that the Soviet Union was gaining control of this area in the twenties, he went through and modified all the borders to make sure that if any of these areas ever got independence again, that it would immediately be at one another’s throats.

And he wielded his pen with extreme levels of skill so that the people a little bit closer. The dominant issue in this area actually isn’t the Russians. The Russians had a defense agreement with the Armenians until very recently, and I guess technically it’s still in force. But the Russians have moved most of their troops out, moved them to Ukraine because they need every pair of hands and every gun.

And yet and that’s kind of held this area frozen. But once you get into the lesser Caucasus, remember greater Caucasus, which are the North less your Caucasus or this kind of broad zone in the south, the mountains are nearly as onerous. It’s still mountainous, it’s still difficult. But there are a lot more corridors that access this area. And in this zone, it’s traditionally not been the Russians that have been the major power.

It’s been either the Turks or the Iranians. Well, let’s see here on that. The local powers have always had those Turks and Armenians is accessing one another’s land. The Turks and the Iranians have always had a bit of a problem rubbing up against each other. There are a number of mountain passes and access points and corridors that allow access, but they’re all seasonal and limited, with one exception.

And that is this right here. This is the Cross River, and this is the best point of access between Anatolia or Turkey or the Turks in Persia or Iran in the Arabians. The thing is, Stalin, again, it’s split. So in the north, the northeast section of that corridor is controlled by Armenian. It’s home to the Armenian, the capital of Europe in the northwest chunk is controlled by the Turks and is home to Mount Ararat.

The Southeast Choke is Nikitin and it is controlled by the Azerbaijani and in the southwest Choke is Iranian, right here in Iranian Azerbaijan. So goes the thinking. The Iranians are really happy with the current state of affairs because if this corridor is split into four different chunks, then no one can really use it to pour Turkish power down into northern region.

However, what’s going on with the Azerbaijanis is they want a corridor that crosses this zone of southern Armenia and directly links Azerbaijan to Nikitin. And then there’s a road and rail system here that goes into Turkey proper. If that happens and you have Turkish power controlling over half of the corridor and the Turks can directly reinforce Baku by road and by rail.

And from the Iranian point of view, this would be a disaster, a disaster from Armenian point of view as well. Not only would they lose control of some of their southern territories, but then they would be completely locked off and surrounded by Turkish power. And if you’re familiar with your history, the Armenian genocide carried out by the Turks in World War One was pretty brutal.

And so the Armenians are looking for anything, anything to kind of grab on to a degree of independence. They need a security gear, a security guarantor. And if they can’t have the Russians and the Iranians or the all the other player in town in Azerbaijan getting control of southern Armenia would basically end that forever. And then it would just be a matter of time before Armenia itself becomes a state repeating of the Turkish system, rather than the Iranian or the Russian system, something that the Armenians would rather avoid.

But for the Iranians, this is also a national issue, because this corridor, if you continue following the south, eventually reaches the city of Tabriz, which is the capital of the northern region. Excuse me, if Iran and northern Iran is primarily populated by ethnic Azeris who are basically the same ethnic stock as the folks who run as a region.

So they have always been the group in Iran that the Iranians have been most nervous about exercising a degree of independence, that the Turks get de facto control of this area, all of a sudden that is very much in play. So we have a situation here where maybe the Russian are only being stage left because of the situation in Ukraine.

They can only focus on the things that are core to them. And since they control Abkhazia and South Ossetia, they control the access points to the Northern Caucuses, and they’re kind of declaring that good enough. But with the Turks now rising, we’re going to have a second level of contest in this region between the Turks and the Iranians, with the Azerbaijanis being a very, very, very willing ally.

So what we’re going to see over the next several weeks or months, something that the United States is concerned about, is this point becoming in play, because if that becomes in play, then this whole or all of a sudden becomes in play. And we need to start thinking about what it means to have Turkish troops in the cave in hard on another part of the Iranian border.

That’s where it is. Okay. I think that’s everything. You guys take care.

An Iran Deal We Can Live With

There’s finally a deal on the table between the US and Iran that everyone can live with…it even looks like Israel has given it the green light. So what does this deal actually look like?

On the surface, this deal looks like the US is getting back those American prisoners who were unjustly detained and releasing $6 billion of frozen Iranian funds. However, this isn’t just about a few people who got caught with dime bags; it’s about the broader relationship at hand.

We’re talking about Iran discontinuing funds being sent out to their militias, spinning down some of their enriched uranium, coming back under IAEA inspections, and in exchange, the US will enable them to sell crude abroad.

In no way is this a done deal, but some factors are helping to push this along. The big one is the Russian sanctions’ impact on Iranian crude exports and the overall financial situation, which makes the $6 billion offer sound pretty appealing.

We could be looking at the most productive stage of American-Iranian relations since the 70s; all it cost the US was $6 billion of someone else’s money. Sounds like a win to me.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
Support medshare's global efforts

What’s Going On with Iran and Oil Markets?

Over the last few weeks, we’ve seen Iranian oil hit markets at nearly decade-high volumes…but production has remained relatively flat. So what’s really happening here?

Many of the sanctions being placed on Russia were originally used on Iran. And as we’ve seen Russia sell oil at a massive discount, Iran is following suit to come under the sanctions regime (rather than just smuggling it out). Basically, Iran is just selling oil LEGALLY now. Let’s compare Iran’s situation with Russia’s.

Russia is facing an existential threat, so nothing is off the table for them. Iran’s situation isn’t as dire, so they can have some patience. Russia produces most of the stuff needed to survive, so pissing countries off or stepping on toes isn’t a concern for Putin. Iran can’t sour their relationships because they still import a lot of stuff.

This gives Iran a chance to do something the Russians wouldn’t even consider…talking. Meaning there are opportunities for everyone still on the table.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Iranian Seizure of Oil Tanker Could Spell Disaster for China

The Iranians have seized the Advantage Sweet, a Turkish-owned oil tanker carrying roughly 800,000 barrels of Crude. The press release (or should I say ‘slap on the wrist’) issued by the US Navy should have the Chinese very concerned about their supply lines.

Since World War II, the US has patrolled the sea lanes and enabled the safe flow of international resources and products. However, this incident is just another indication that the US is slowly stepping away from its commitment to the maritime order of protecting the high seas.

While the US can just shut down its international energy trade and operate with its neighbors in North America, places like China have much more at stake. Since China falls at the end of a very long supply chain, any disruptions could spell disaster for the Chinese economy; that’s only one of many issues they face.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Hey everyone. Peter Zeihan coming to you from Colorado. It is the 27th of April. You’ll be seeing this the morning of the 28th. The news that just came out is that the Iranians have snagged another tanker, a vessel called the Advantage Sweet, which is a SuezMax oil tanker, which means it probably is carrying about 800,000 barrels of crude. It is owned by a Turkish company and is registered in the Marshall Islands.

The U.S. Navy has issued a press release basically saying bad Iran, very, very bad Iran. And that’s it. This is your periodic reminder that when it comes to international energy markets, the U.S. just doesn’t care anymore. And if somebody wants to deal with Iran seizing tankers, then they will have to do it without the United States. This is a big change, of course in most people’s perceptions, especially compared to the policy sets that we have seen in the United States for the last several decades. But remember why those policy sets have existed. It’s not that the United States imports a lot of oil from the Middle East. It doesn’t, it really never has, but its allies do. And the entire basis of the American post-World War II global environment was that we will fight wars to protect resource flows and product flows so that “you” will sublimate your military needs to us. Basically, we will fight your economic war. So you don’t have to. And that gives us a free hand in control of your militaries in case of a confrontation with the Soviet Union. The Russians may be coming back in a big way, but they are not the Soviets and they do not have a global position. And so the United States, bit by bit under Obama, under Biden, under Trump, have all basically steadily reduced the American commitment to the maritime order that allows global trade and global energy markets to work. And so this Advantage Sweet, this tanker that’s been gone, the U.S. really doesn’t care.

But if you’re China, this is a problem because the entire existence of the Chinese economy and its strategic position is based on the idea that the United States, no matter what else happens, no matter what the Chinese do, no matter how much military action China carries out, that the Americans will still uphold civilian freedom of the seas. And as we’ve seen today, again, the U.S. has no interest in that anymore. So next time we do get a meaningful interruption to international energy flows, the United States basically closes its borders to energy trade. It’s self-sufficient within North America. And the Chinese are at the very end of a very long supply line that they have no hope of protecting. And that means they’ll deindustrialize. And that means it’s the end of China’s unified nation state. And of course, if you’ve been following me for a while, you know that that’s only one of the many reasons why the Chinese are going to end this decade.

Alright. That’s it for me. Till next time.

Iran Discovers a Huge Deposit of Lithium

The Iranians have stumbled upon what every Green dreams of…a massive store of lithium ore. If the numbers prove true, it would be the 2nd largest deposit ever discovered. But is it too good to be true?

Before I go crushing your dreams, I want to acknowledge that this is an exciting discovery, and it’s obviously a good thing that we found more Lithium. However, it will be a while before this lithium moves the needle…if at all.

The lithium was found in a very inconvenient spot, so transportation is going to be a pain in the ass. If the Iranians want to process this stuff themselves, they’ll have to build out the infrastructure from scratch. On top of all that, Iran’s policy towards private & foreign investment is…less than friendly. So maybe we’ll hold off on the lithium parties for now.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Update: Iranian Protests Continue

By Michael N. Nayebi-Oskoui

I think an update will be helpful as Iran’s current spate of protests continue into their third month. I would like to state at the beginning of this update that as a personal matter, I stand with all people—especially the world’s youth—who yearn to live free, safe and productive lives. The people of Iran are no exception.

It’s also important to note that Iran has no semblance of a free or impartial media; there is a dearth of objective information about crowd sizes, and the number of deaths and arrests. This is by the regime’s own design. I have no doubt that the regime is arresting as many people as they can, and that state violence has proven to be fatal—likely hundreds of times. But every video and anecdote and photograph and story shared by protestors with the outside world is done with a stated goal and purpose. As I tell members of my own family, everything you’re seeing come from Iran is designed to break hearts, enrage, drive up engagement and support—not too difficult a thing when the opponent is the Islamo-fascist Iranian regime. But take certain characterizations with a grain of salt.

As I mentioned in our last update when protests began to escalate, Iran has been in the midst of several—often overlapping—periods of significant unrest, correlating with the sharp decline of the economy beginning in 2017. The current phase of protests lead by Iranian youth is not one that lists economic grievances at its core. The pithy, emotive slogan of “woman, life, freedom” presents a (n exceedingly Western friendly) set of demands around human rights and basic dignity. But make no mistake: Iran is a very poor country, and only getting poorer.

It’s also worth noting that despite many peoples’ assumptions, Iran is not a very young country. The 18–30-year-old cohort is the smallest segment of Iranian society.

Since the early 1980s, Iran has seen one of the most precipitous drops in birthrates in the world:

Data and image courtesy of World Bank

But let us not gloss over the truly sorry state of the Iranian economy. Iran’s current GDP per capita is less than Egypt’s. This is not a comparison most countries would welcome, and certainly not on the losing end. (Both are poorer, on a per capita GDP basis, than Iraq.) Iran’s youth face entrenched unemployment (near 30%). Iranian inflation is high (over 50%). The average Iranian household’s annual income is less than $10,000 USD. This is important context—for Iranian expats and descendants of Iranian expats living abroad, especially those who left Iran during the 1950s and the 1979 Revolution, the idea of deeply entrenched poverty in Iran is a surprise. Or a reality they have chosen to ignore.

But in the various and constant pensioner protests (pensions haven’t kept up with inflation), in the protests to fuel price hikes that lead to 2019’s Bloody Aban, in Khuzestan’s violent water protests of 2018, 2021, and 2022, in the various localized labor disputes of petroleum workers, the Haft Tappeh sugar factory, et al the common unifying thread is a deteriorating economic condition. And most of all: individuals’ dependance on the regime, its subsidies, and cash payments.

Tehran will blame sanctions and yes, sanctions have played a large role in eroding the Iranian economy, but blame is most fairly set squarely at the feet of the regime’s bad actions and economic mismanagement. This doesn’t change the fact, though, that most Iranians would struggle to pay for groceries if the regime disappeared tomorrow. Economic realities are not determinative, and I am not claiming that the limited ability of the Islamic Republic to soften the harshness of day-to-day life means that they will stay in power forever. But the quandary between freedom and food is not unique to Iranians, especially in their neighborhood: Libya, Syria, Iraq, Lebanon, and Yemen are all salient examples of the difficult transitions facing post-Revolutionary societies.

Which should not suggest I’m advocating for one outcome or another. I’m sure my “dream scenario” would align with many Iranians’, but I am in the business of delivering objective, data-driven analysis. This is why my overall assessment from August still holds: I don’t think the protests in Iran have risen—yet—to global geopolitical significance, despite the very emotional and human toll being paid by protestors. Why not? We haven’t seen any dissolutions or cracks within the ruling elite. Iran’s regional ambitions have not been curtailed. Tehran has not been cowed into accepting limits on its nuclear ambitions. Its regional adversaries are not ascendant. And we have not yet seen the kind of sustained, massive, cross-societal uprisings or protests needed to push a government out of power.

It’s also worth noting that due to geography and demographic makeup, Iran’s vast military, security and intelligence services are designed with domestic occupation in mind. This was as much true under the Shah as it has been after 1979—that the very same apparatus used to subjugate Iran’s population can be used to achieve regional ambitions beyond Iran’s borders is a bonus. Iran’s largest security challenge has always been from within; every region, sometimes every set of neighboring mountain valleys hosts a stunningly diverse array of cultures, ethnicities, languages and sectarian differences. I find it exceedingly unlikely that popular unrest will bring down the current clerical regime in Iran unless elements within the regime themselves choose to use public unrest to shift the structures of power.

The situation remains fluid, however, and there are several things I’m watching for to see any potential changes to our assessment:

  • What is the size and make up of protests? Rather than seeing current protests as a new phenomenon, I instead see them as the entry of Iran’s youth into a growing, years-long movement of unrest against the Iranian regime. As I laid out earlier, the regime’s ability to contain dissent has all but disappeared. This is one of the most difficult questions to answer, as both the government and protest channels are not objective sources. Outside of restive areas like Kurdistan and Baluchistan, however, videos and photos of protests rarely show crowds larger than a few dozen to low hundreds. The crowds, especially when hooliganism takes over at night, are very young and disproportionally male. This will have to change if we’re going to see security forces shift tactics.
  • Are security forces shifting tactics? The regime has been able to continue relying on local police and Basij forces, using a mix of live fire and less-lethal methods to push back crowds of protestors. This tells us several things, including protestor tactics are not becoming more sophisticated, and the numbers of protests (and numbers of protestors) are not overwhelming this first-line defenses of the regime. There have been no serious defections loss of support among the regime’s enforcers.
  • Are protest tactics shifting? Despite social media hashtags claiming an #IranRevolution, or some journalists’ descriptions of scenes in certain cities being a “war zone” protestors are largely disorganized and diffused, contained to neighborhoods. Protestors are still largely using tire fires, burning the contents of dumpsters, and using petrol bombs (Molotov cocktails) and hurling stones in their engagements with regime security forces. We’re not seeing the formation of neighborhood militias. There are no significant signs of people being armed. Protestors aren’t building IEDs. The smoke, especially from trash and tire fires, equally obfuscates and adds dramatic flair to clashes—but hasn’t caused a substantive weakening to the regime. It is likely inhibiting larger/older crowds from gathering on the streets. Similarly, I tend not to focus on statues, banners, and posters of regime figures being attacked. If the parliament building gets sacked, however, that’s a different story…
  • Is there unified, nation-wide participation? Many activists and the journalists they speak to will point to crowds of people in cars, shuttered shops, calls for labor strikes, etc as signs of passive but unwavering resistance to the regime. Maybe? The reality goes both ways. I would suggest many people look to the George Floyd protests that rocked cities across the United States (and eventually lead to the largest domestic mobilization of National Guard forces since WWII). Whether or not a business is closed in solidarity or in anticipation of violence isn’t always immediately discernable—leading both sides to be able to claim what they want. During the 1979 Revolution, the bazaaris, local business owners and traders, added considerable economic and social pressure on the Shah when they joined protestors in the streets. After decades of sanctions and the rise of the Islamic Revolutionary Guards’ (IRGC) role in the domestic economy, the number/size/scope of bazaar participation in modern protests is limited but still excites the expat community.
  • Has the regime lost civil society? As of now, despite all the heartache, teachers and professors are still working. People are still sending their kids to school. Debris from protests is still being cleaned out of the streets. Mail is still being delivered. Fuel is still being refined. Food is still showing up on shelves. The quotidian minutia of the system comes together day after day, even after weeks of protests.

And most important:

  • Is the regime still able to meet its basic economic commitments to the Iranian people? This might not make a sexy TikTok or dramatic share on Twitter, but if fuel prices rise—or petrol stations run out, the regime is in serious trouble. If the Islamic Republic can no longer provide subsidized bread, it likely has no future. Think of the ignoble end of the Rajapaksa dynasty in Sri Lanka—once the government could no longer guarantee access to basic staples like food and fuel, their fate was already sealed.

In addition to the things we’re looking for, I have some additional observations:

  • There is a different kind of intensity when it comes to protests within Iran’s Kurdish regions, and in the long restive province of Sistan and Baluchistan. These are Sunni majority areas with distinct cultural and linguistic identities and histories of agitating for independence even before the 1979 Revolution. Iran’s Kurds are also the most politically organized pocket of resistance, with ties to militant Kurdish groups in Turkey and Iraq and a large, international diaspora. While protestors might chant “woman, life, freedom” the tone and timber of resistance among Iran’s Kurds and Baluchi populations (and to a lesser extent, Azeri) leads me to think that we are looking at the early stages of a renewed and bloody phase of conflict in both areas.
  • Kurdish and Baluchi independence is anathema to most Iranians, however, which is likely why protestors are still organizing around the death of Mahsa Amini, a young Kurdish woman who died in police custody, and under the current banner of “woman, life, freedom.” But expect challenges to Iran’s territorial integrity, militancy, and a different magnitude of violence from state forces in response. The Islamic Republic will be keen to follow in the footsteps of Saddam’s Iraq and Syria’s al Assad regime in pitting restive minorities against its majority populations.
  • While many are comparing Iran’s Supreme Leader to the Assad and Saddam regimes, there is a major difference: Iran’s ruling elite does not represent an ethnic or sectarian minority.
  • I don’t see any outside power—US, EU, Russia, Saudi Arabia, Israel, etc—stepping in and forcing regime change. Also, I would not hold my breath regarding the return of the Shah’s family to power…

We’re not there yet, but I am often asked what I think “comes next” in terms of Iran, or what a post-ayatollah world looks like. I think the rule-by-ayatollah model is the most unpopular and weakest link of the current system. On paper, Iran’s clerical elite lend legitimacy to the IRGC, its subsidiaries like the Basij, and so on. And minus an initial short period after the revolution, Iran has only had one non-clerical president: Mahmoud Ahmadinejad. In reality, however, the ayatollahs and mullahs and so on are enabled and defended by the IRGC and the various state apparatuses they control. While I do not think this was always the case, the dependency of the part of the mullahs has increased significantly in recent years, especially since the 2009 Green Movement and with the rise of the sanctions economy. (If you want to get especially conspiratorial and discuss how the only winners in an Iran with an entrenched social protest culture and never-ending sanctions are the IRGC, you’ll find plenty of people who’d agree with you.) All this is to say, I think a charismatic, nationalist-populist leader could do very well for himself. Especially if he came from an IRGC background and could present a non-clerical face that would maintain much of the various state elements in place—namely the plum position of IRGC alumni.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Iranian Drones and Russian Desperation

Russia’s reliance on Iran for armed drones and missiles is a resounding fall from grace for the one-time defense manufacturing rival to the United States. And a telling indicator of not only just how far the Russians have fallen, but how few reliable friends Moscow has left. It is also a stunning reversal in leverage for Putin, who for decades has used his ability to lean on Tehran (especially when it comes to US-Iranian spats) as a tool against Washington, DC.

Beyond the geopolitical intrigue, the shoddiness of Iranian tech underscores the determination of Russian leadership to inflict as much pain and damage to Ukrainian civilians and infrastructure as possible. Iranian drones are unreliable, loud, and easily shot down. Russia has to overcompensate by sending small swarms all at once to take out their intended targets–many of which are residential areas, train stations, and power infrastructure. Really hard to accidentally target any of these over a half-dozen times…

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Iran Grapples With Protests…Again

Iran is in the midst of one of the most serious rounds of public unrest since November 2019, when a hike in fuel prices sent potentially hundreds of thousands of Iranians out into the streets. Dozens of structures were burned during those protests, statues of regime figures pulled down, and plenty of calls for death of Supreme Leader Ayatollah Khamenei and the Islamic regime itself. Outside observers estimate over a thousand Iranian citizens were killed, and over ten thousand were arrested. Current protests are being met with the same harsh response by regime security forces, even if we have not yet reached the scale of brutality seen in 2019. In January of 2020, Iranian military forces shot down Ukraine International Airlines Flight 752, setting off another wave of intense national protests. Iran has had a series of significant protests movements since then, sparked by everything from the country’s abysmal handling of the COVID-19 epidemic, to runaway inflation, drought and lack of water in places like Khuzestan, etc. 

The most recent protests were sparked by the death of Mahsa Amini, a 22 year old Kurdish Iranian woman who was arrested because of improper adherence to hijab laws while visiting Tehran with her brother. While details out of the Iranian regime are sparse, activists say that head injuries sustained at the hands of Iran’s morality police lead to her death in custody. Another round of national protests has erupted since her death on September 16, though what had initially started as a women’s rights protests against hijab rules has quickly escalated to encompass the broad swathe of frustrations and discontent of many Iranian citizens, especially the youth.

I don’t think there is anywhere in the world where protests are watched with as much bated breath as Iran. In part due to history (mass social unrest lead to the collapse of the Shah’s regime in 1979), in part due to international intrigue (since the fall of the Soviet Union, the US has had few feuds that have lasted as long as the one with Iran), and in part due to Iran’s own behavior (Iran is an aggressor state against most of its neighbors and has links to militant groups around the Middle East and world).

And so the gruesome death of a young Kurdish woman, and the subsequent protests around it, have captivated a rapt audience. It would be an almost too delicious irony if the death of a young Kurdish woman who refused the imposition of the hijab was the ultimate downfall of the Iranian regime. Unfortunately, that is unlikely to be the case. And while Iran’s Kurds remain perhaps the most organized, most politically active subgroup of Iran’s multi-ethnic society, Iranian Kurdish desires for autonomy/statehood are largely anathema to most other Iranians. It’s hard to imagine current solidarity would extend much beyond any potential toppling of the regime.

Iran’s constant protests are unlikely to stop anytime soon, and while they do point to an erosion of the regime’s ability to maintain an iron grip over its citizens, current protests are unlikely to lead to a direct exit of the ayatollahs and mullahs at the apex of the regime. Frustration is a powerful motivator, but Iran’s protestors lack a charismatic national leader or unifying ethos beyond discontent. Ayatollah Khomeini famously leaned on a pan-Iranian, Shi’ite identity enforced with a big stick to create his vision of a post-Shah Iran. And that big stick remains in the hands of the regime today, ready to cudgel any opposition back into submission. Until that changes, or pillars of the regime defect, or significant foreign aid and coordination steps in on behalf of the protestors, Iran is destined to continue an unfortunate pattern of everyday citizens yearning for change clashing with a regime determined to crush them to ensure its own survival. 

The above was written by our Director of Analysis here at ZoG, Michael Nayebi-Oskoui. The video below is obviously from me.

We have never and will never charge for our newsletters or videos, but we do have an ask. If you enjoy our products, we ask you consider supporting MedShare by clicking one of the links below. MedShare is an established non-profit organization that helps respond to medical need globally, including to the ongoing crisis in Ukraine.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

This Is How the World Ends, Part I

by Peter Zeihan, Melissa Taylor, and Michael N. Nayebi-Oskoui

I like to say that I sell context. It’s all about how seemingly disparate things like age structures and trade patterns and political evolutions and technological advances interact. In any such dynamic system there are winners and losers. My concern is that the global system itself now faces a moment of truth in which the countries of the world, first and foremost the United States, will fail to rise to the occasion. Which is a nice way of saying that what I’m really seeing – what I’m really selling – is the end of the world.

This world system was put into place 70 years ago. The core of the international system during the Cold War was the Americans’ support of the global trade and security order. The Americans agreed to provide global and regional security to their allies in exchange for deference on security matters. When issues of economic import rose to prominence, the Americans tended to give way. When issues of strategic import rose to prominence, the Americans tended to get their way because that was the deal.

This arrangement froze geopolitics as previously independent countries were pulled into a massive, interconnected system because of not only America’s overwhelming economic and military power, but also the power of the alliance structure it controlled. This was sucha powerful force that it even pulled in America’s enemies one-by-one and allowed them to rise, fueled on exports. In the process, the US made the global economy dependent on the relatively free flow of goods, people, and money while also alleviating the need for the large militaries that defined the first half of the 20th Century. In other words, the US and its alliance shifted every global system that mattered for literally every country in the world.

Everyone except the US, which managed throughout this to remain isolated economically. It maintains its own military, largely produces what it needs (though it imports a lot of what it wants) and remains the largest economy in the world. With the fall of the Soviet Union and the end of the Cold War, just as the world began to truly bet their economies on the American plan, the American’s need for this incredibly expensive system faded. It’s taken the US awhile, but it finally noticed.

There is no replacement for US power, economic or military. “Europe” as a concept, China, and Russia are all in existential struggles and each of them is likely to lose. There is no alternate reserve currency. There is no one who can react to any event anywhere in the world like the US can. The Americans are leaving a power vacuum and we know what happens in power vacuums.

I’ve been speaking and writing about this approaching “end” for the better part of the past decade. One of the fun things – and incidentally, one of the things that helps keep me sane – is that it is all very abstract. I can blithely note that wars will happen, that supply chains will break down, that the lights will go out, that famine is an inevitability, but so long as the timeframes are fuzzy and the locations are over the horizon it is easy to speak and write with a degree of detachment. This doesn’t affect me, and certainly not right now.

I think/fear that I’m about to lose that insulation. The end is pretty god-damn nigh. Exactly how this plays out is still very much up in the air. The blow by blow will matter immensely in the short and even medium term. So I’m going to lay out the most recent big events that seem to be giving shape to the Disorder over the course of several newsletters.

Event 1: The United States withdraws from the Iran nuclear deal (May 8)

The Obama administration did not sign the U.S. up to the nuclear deal because it thought Iran would suddenly become an upstanding member of the international community. After decades of being the region’s arbiter, the American security apparatus in specific and the American public in general wanted to get out of the region. That meant the White House needed to make a choice.

Option one was to appoint a “winner.” This “winner” would patrol the region, keep the local powers in line, and in general do what the Americans had done: keep the region as stable and static as possible.

The Obama team didn’t like the candidates. Iran was out as a matter of principle. Saudi Arabia didn’t field a meaningful army, much less a navy. Israel was potent, but small, and the religious angle meant it could never lead the region. Turkey may have been capable, but it had unrelated interests in Europe and the Caucasus and the Mediterranean, and so could never concentrate its efforts on such a gangly region like the Middle East.

Even then, there was no guarantee that any “winner” would look out for American interests unless a large American military presence remained… which would defeat the point of a sustained withdrawal. And the last thing Washington wanted was to cause the emergence of a new regional hegemon that was not consistently pro-American.

That left option two: establish a regional balance of power so the region would self-regulate. This balance, ultimately, is what the nuclear deal sought to achieve: partially rehabilitate Iran, partially reintroduce it into the international system so that Iran could counter – and be countered by – the other regional players. In doing so – or so the theory goes – the region’s wars will be many, but limited.

The key selling point of the balance-of-power option was that the Middle East has so many competing centers of power that no single country would ever be able to gain a significant, long-term advantage. That would keep any of the (many) expected battles bottled up within the region. It sounds a bit cruel, but the ongoing civil wars in Syria and Yemen are good examples of the balance-of-power strategy working because those conflicts keep the region’s powers at one another’s throats.

Trump’s withdrawal from the nuclear deal does two things. First, it wrecks the balance-of-power strategy by gutting the possibilities of the region’s most active player: Iran. The resurrection of global financial sanctions on Iran will – at a minimum – halve the country’s export earnings by year’s end. This means the Americans will need a new strategy for the region. At present, the Trump administration hasn’t offered anything as to what that might be. But that is an issue for another day.

From my point of view, the second outcome of the withdrawal is far more important. The old/new sanctions on Iran uncaps what has traditionally been the Americans’ most potent economic weapon: secondary sanctions.

Secondary sanctions are not something the Americans have ever used often or liberally. They present would-be sanctions busters with a choice: do business with the sanctioned country (in this case, Iran) or do business with the United States. Since the Iranian market is roughly 1% the size of the American market, there may be a bit of whining but for most firms that’s not all that difficult a decision. And that’s before you consider the long-term demographics of the world’s major economies.

What is truly different this time around is the presence of some institutional infrastructure the Obama administration set up a few years back to force the Iranians to negotiate the nuclear deal in the first place. Via an exhausting series of bilateral negotiations, the Obama team got a good hard grip on something called SWIFT, a system for managing financial transfers between various players in the international space. They used this newfound power to apply secondary sanctions to anything that touched the U.S. dollar. Since the U.S. dollar is the only global currency of exchange (the euro position has been shrinking for years, and even the Chinese yuan has been backpedaling of late) the end result was to cut any sanctions-busters out of pretty much all international trade, even if those sanctions-busters have no direct exposure to the American market.

I think the Trump administration fully understands just how powerful of a tool it just picked up, and that tool is perfect for the job of pretty much everything else on the administration’s international agenda.

Up next: Europe Guts Itself.

Revisiting Iran

By Peter Zeihan and Michael N. Nayebi-Oskoui

The White House has been strongly hinting for two weeks that President Trump is unlikely to “re-certify” the Joint Comprehensive Plan of Action (JCPOA) or as it’s better known, the Iran Nuclear Agreement. The emotions from across the political spectrum range from jubilation to outright hysteria though, it’s important to note, the reactions don’t fit neatly within American party lines (plenty of Democrats had to be strong-armed into supporting the deal, and more than a couple Republicans believe it is in America’s interest to stay within the accord). The reality of the matter is much more complicated, though I believe it’s safe to tell everyone to take a deep breath and calm down.

A quick and dirty discussion of the mechanics of the JCPOA are in order. Technically speaking, it’s a non-binding political agreement (remember the Paris Climate Accords?). The Iran Nuclear Deal is not a treaty. It’s a series of interconnected agreements and a complex set of verification steps and was designed to make it easy for the United States to pull out or re-apply sanctions on Iran at will. To that end, the American president has to re-certify the agreement every 90 days, as well as sign off on a series of sanctions waivers that cover periods of time from a couple of months to a year. We’ll come back to this part.

The agreement, however, was approved by Congress, and in the event that President Trump or any of his successors decide to refuse certification of the deal – essentially declining to admit that Iran is holding up its end of the bargain – Congress has 60 days to attempt to change portions of the JCPOA they disagree with or (re)apply sanctions both old and new.

That last bit about sanctions is where things get tricky, before we even get into the fact that Congress couldn’t get anything done in 60 days in a normal political season, let alone when they’re racing to hammer out a budget and attempt to forge some sort of tax reform deal. The JCPOA and the Presidential waivers cover a web of sanctions that are both those passed by Congress and those that came into effect via executive order. The latter is where Trump could snapback previous executive sanctions and apply new ones if he feels Congress isn’t taking Iran to task as much as he’d like.

There are other complicating factors here, namely the five other nations who are members of the accord (including a France that has steadfastly refused to renegotiate the terms of the deal as its companies race to access Iranian energy plays and the third largest market in the Middle East). Europe as a whole and France, Germany, and Britain in particular are loathe to re-enter a difficult and prolonged negotiations with the Iranians given all the other problems they’re dealing with (like Russia, Merkel’s declining power, and an overhaul of the socioeconomic pillars of political life…  just to name a few), and traditionally have had a much easier time dealing with Tehran than the Americans.

At the end of the day, though, not much is likely to immediately change. There is a strong argument to be made that it’s bad for America’s long-term interests to be seen as an unreliable partner to international agreements as well as further alienating EU/NATO partners, but the most likely scenario is that President Trump refuses to certify, the US Congress gets busy doing nothing, and that Iran continues trading and dealing with Europe, Russia, and China. Meanwhile, the US create a unilateral sanctions system to target Iran – perhaps with secondary sanctions to target European and Asian players who are doing business with Iran. That’d return us to the status quo ante that defined the US-Iran relationship for not only much of the Obama administration, but also the past four decades.

So… now what? If the US is serious about disengaging from the Middle East—and the relatively standoffish (in terms of the US response) American action in Libya, Syria, post-ISIS Iraq, and Yemen are goods signs that the US is indeed serious—there are few realistic options on how to contain the Middle East quagmire.

Option one is to establish a regional balance of power. This requires encouraging Turkey to be an independent actor rather than a state that is a mere adjunct of NATO (check), turning a blind eye to Saudi Arabia’s tendency to spawn Sunni terror groups (check), and somewhat rehabilitating Iran in the international community so that it can counter the other two. That last was the Obama administration’s rationale for the nuclear deal in the first place. The advantage of this route is that the region’s various players become locked into a never-ending death struggle that so consumes them, they lack (ideally forever) the freedom to act out-of-region.

Option two – which appears to be Trump’s preference – is to anoint one of the three major players to run the region in the Americans’ stead. Those of us who remember the heady days of sword-dancing and orb-touching from President Trump’s earlier visit to Saudi Arabia will not be surprised to hear that the likely beneficiary of the Trump administration’s emerging Middle East policy is Riyadh. What’s more important is that Riyadh certainly thinks so, too. From lip service moves such as allowing women to drive, to staging a practice war against mountain-bound Shi’ite-aligned rebels in Yemen, to buying-off and/or strong-arming regional Arab competitors such as Egypt and Qatar, the Saudis are certainly trying to set themselves up as the regional powerhouse.

But Saudi Arabia is an odd choice. It is a desert country completely dependent upon oil sales, predominantly to a China that hopes to challenge US hegemony in the Pacific. It is the only of the three that is not a democracy, and shows zero interest in even considering shifting its domestic politics in a liberal direction. It’s primary foreign policy strategy is to spam out militant groups to turn its rivals’ neighborhoods into post-apocalyptic carnage zones (its hands were in the rise of al Qaeda, the Taliban and ISIS). Between its deliberate lack of civil society, its brittle political culture and its monochromatic economy, it simply doesn’t have any of the “normal” levers of power that would allow it to be a regional hegemon without a great deal of ongoing help.

And if it needs a great deal of ongoing help, that doesn’t really mesh with the core American desire to get out of the region.