Mario Nawfal
@MarioNawfal
Market Analyst Tom Luongo says Trump isn't fighting Iran to control the Strait of Hormuz; he's using the Strait to break Europe's ability to finance the Ukraine war. Most people see Iran and Ukraine as two separate conflicts, but Tom thinks they're the same war being fought on different fronts. His argument is that oil is the collateral that underpins the modern economy. The more expensive and uncertain energy becomes, the harder it is for European governments to borrow cheaply, keep their industries competitive, and continue funding Ukraine at the current pace.
That's why he thinks the Strait of Hormuz matters so much, because whoever controls the world's most important energy chokepoint also influences the financial foundations that wars are fought on. Trump can't simply announce the end of the Ukraine war, even if he wants to, because too many powerful interests are invested in keeping the conflict going.
So instead of attacking the war directly, Tom believes Trump is attacking the economic conditions that make the war possible. He also made one of the interview's boldest claims: Europe has poured so much money into Ukraine because many European leaders expected the war to eventually open the door to Russia's vast natural resources, providing the cash flows needed to justify years of borrowing and military spending. If that never happens, they're left with enormous debts and very few ways to pay them back. Most people think the shortest route to ending the war in Ukraine runs through Kyiv, but Tom thinks it runs through the Strait of Hormuz. And if he's right, we've been looking at the wrong map all along.