Splendors of the global market economy today:
The Iran war and energy prices
The opportunities and risks of an air war in the Middle East
The war in Iran is causing all sorts of damage – not only to people on the ground who are being terrorized by the warring parties with bombs and missiles, but to countless others around the world for whom life is becoming more expensive, who are therefore suddenly becoming poorer – so poor in some parts of the world that they have to gather firewood or are facing full-blown famine. As is well known, this is because the war in Iran is rocking “the markets” and shaking up “the world economy.” However, those who are “the world economy” – since it’s their doing – are apparently not the least bit shaken up. On the contrary: With their calm professionalism, they scrutinize the events of the war, the material dependencies and national business locations for whatever new developments can best be taken advantage of in order to enrich themselves. In this way, they are the ones who guarantee the global economic collateral damage and human tragedies that do not just simply result from the war, but from the business calculations that are made with it.
The bombing in the Gulf region is good news, for example, for those who make money elsewhere from the extraction and sale of fossil fuels. The fact that in the Middle East numerous extraction and production facilities for oil, gas, and all kinds of other raw materials are being blown to pieces and that thousands of cargo ships with the corresponding freight are stuck in the Strait of Hormuz – meaning that vast amounts of material wealth is being destroyed – makes them instantly richer under the right circumstances. Because when it can be foreseen that in the future there will be less of this stuff on the market, their power to exploit the demand for it increases. Accordingly, they don’t even wait for the material shortages to actually kick in. Even before a single drop of oil or a single gram of fertilizer could conceivably go missing anywhere, they raise prices and thereby create shortages of a very special kind: the coveted commodity ends up wherever a higher price is paid for it and is unavailable to those who can’t afford it at the new price.
The transportation industry is also doing its part to raise prices. Although shipping companies are recording unwelcome business losses and bearing higher fuel costs due to the blockade, they know how to offset these losses by raising freight rates – costs that are passed down the entire supply chain until they reach the end consumer. If they want, they can even capitalize on the risk of coming under fire in the Gulf region. From a business standpoint, such a risk is by no means automatically something bad that must be avoided per se, but rather an opportunity to charge even higher transportation fees. And wherever such risk-conscious decisions serve capitalistic business calculations, there are certainly a few carriers willing to take on the perilous passage – that is, to force it on their crews.
In the event something does go wrong, there is – fortunately – the business of insurers who also take advantage of the dangerous situation across the entire region surrounding the Strait of Hormuz by charging hefty premiums. In a pinch, they cover the resulting damages – in the only form that shipping companies care about: as costs. From the destruction of cargo and ships by missile attacks and explosions to the pollution of the ocean with oil, there is nothing here that can’t be assigned a price tag. Even how much the prematurely ended life of a Filipino sailor would still be worth if he had been lucky enough to continue working for a while longer can be calculated and paid out to his relatives as compensation. In all of this, shipping insurers always reserve the right to freely decide which transactions are worthwhile for them. And because the prospect of actually having to pay out claims currently seems too likely to them, they are now adding a second blockade to the military one by withdrawing insurance coverage for voyages through the Strait of Hormuz.
All of this boosts the business of those who have nothing to do with the extraction, processing, or transportation of raw materials, but instead set their prices all the more. “The financial markets” – that is, powerful money owners – conduct their business by trading various titles to the purchase of raw materials – not in order to ever redeem that purchasing right, but to speculate on changes in the value of these securities. It works like this: they use the turmoil on the oil market as a reason to assume that all the other speculators believe the price of these securities will rise. So they buy up large quantities of them before everyone else does; and because everyone else does, they actually become more expensive and all the owners of these securities automatically become richer. Of course, the opposite type of speculation is also part of the game; the industry’s ingenuity has long since produced the right instruments to make money even from falling prices: As soon as speculators think that everyone else believes prices are going to fall, they simply sell securities they don’t even own – having instead borrowed them for a fee. If everyone then does this and prices consequently do fall, they can buy them back cheaper and pocket the price difference. This top-tier, judicious free market business activity views the real raw materials business – from which it originates – as merely one factor among many, of which the most important is the American president’s social media account. From every statement regarding Trump’s appetite for war – whether it’s a threat to wipe out an entire civilization or the announcement of a ceasefire – the professionals in the business always extract the only message that matters to them: that it’s time to buy or sell as quickly as possible. In this way, they ensure that every whim of the president is followed within minutes by a new datum for the global economy, prompting the media to adopt the talking point that a tweet from Donald Trump has driven oil prices down or sent them skyrocketing.
But the speculation of the finance capitalists is nowhere near an end; actually, it’s only just beginning to pick up speed. They take the price increases that they dish out to the real economy as a result of their financial bets as an opportunity to subject every sector of global business to a critical comparison – specifically, to assess and differentiate them based on the extent to which they are still suitable as a means for enriching their finance capital. Here they identify, on one side, quite promising sectors and companies such as energy conglomerates and transportation firms which are getting richer and richer due to rising oil prices or defense contractors and their suppliers for whom the most glorious boom times dawn with the war. Conversely, they must view others, such as heavy industry or the aviation sector, with a fair amount of skepticism as to whether they can actually sustain their profits in the face of high costs for energy, fuel, chemicals, and all kinds of other raw materials they need for production, so that every time Trump stages a new escalation in Iran they worry whether stock prices will crash. Investors are concerned with one distinction in particular, namely the one between national capital locations: the capitalist centers, which they treat as safe havens for their assets in times of crisis, and the more numerous other countries, whose currencies and their entire economies are appendages of the former, whether as vacation destinations, food suppliers, or “emerging markets.” Finance capital is now withdrawing its investments from these countries, thereby creating a shortage of the one thing that in capitalism truly determines the survival or collapse of entire economies: capital.
-- Translated excerpt from the forthcoming 2-2026 GegenStandpunkt, the Marxist quarterly from GermanyDissenting opinions on the wars in the Middle East
Chronicle of an announced peace:
Trump’s 12-day war in the Middle East (2025)
Trump travels to Arabia and proclaims his vision:
My peace I give unto you – “Let’s make a deal!” (2025)
Israel is creating a new Middle East for itself and the world (2024)
“Al-Aqsa Flood” and “Iron Swords” – an interim balance sheet (2024)
Comments on D. Trump’s withdrawal from the nuclear agreement with Iran (2018)
Why and how the United States wants to get Iran to give up its nuclear program (2012)
America’s chosen people
are taking their hemisphere back
an American politician
More power to the President to make America great again
Why Americans need strong leadership:
The issues of the American election campaign
The Capitol attack: The last battle (for now) in the “Fight for America’s soul”
America in election year 2020: Chronicle of a “Fight for America’s soul”
Populism: Six remarks on an alternative way of exercising democratic rule
Trump’s struggle against the establishment media and for the establishment of a new one
‘Honesty first!’: Trump renovates the moral standards of democratic rule
Donald Trump and his nation — united in the pursuit of happiness
with a perfect world war scenario against China
US military strategy in the Indo-Pacific
This region of the world belongs to the USA – as its asset, without which it cannot be a world power, which is the only way the USA considers itself capable of existing. This is the spirit in which the new US Secretary of War proclaims the good news that the second Trump administration is clearly following in the footsteps of its predecessors.
Trump calls off the Ukraine war –
Europe sticks to its policy of incompatibility with Russia
The warring parties in Ukraine have failed to show their respect for America as the force for peace. The proof: Three years of war without any tangible progress, especially without any apparent benefit for America, but instead a damage caused by squandering beautiful US weapons and billions of dollars.