by Mish Shedlock, Mish Talk:
Fees on safe passage are the heart of the matter.
It’s All About Fees
Trump believes the MOU allows safe passage to all vessels. Iran has disputed that idea all along.
Iran insists it will collect fees and Trump says no.
When Iran struck at ships trying to pass without paying fees, Trump cancelled Iran’s ability for safe passage.
TRUTH LIVES on at https://sgtreport.tv/
The result is a two-way blockade again, with military escalations on both sides.
U.S. Launches Strikes on Iran
The Wall Street Journal reports U.S. Launches Strikes on Iran in Response to Ship Attacks in Hormuz
The Trump administration pounded sites along Iran’s coast in fresh airstrikes and blocked its ability to sell oil legally on Tuesday in a fierce response to Tehran’s recent attacks on ships near the Strait of Hormuz. The twin moves threatened to unravel an interim peace that took weeks to negotiate and drive up oil prices.
Tehran’s targeting of the vessels in the international waterway through which 20% of the world’s oil used to flow “was unwarranted, dangerous, and a clear violation of the ceasefire,” according to a Centcom statement.
Explosions were reported in Sirik, Qeshm and Bandar Abbas, sites in or near the strait, according to Iranian media. The strikes targeted air defense, coastal surveillance, surface-to-air and antiship cruise-missile sites, as well as drone-launch sites and port facilities, according to a senior U.S. official. Abu Musa island and the Tums islands in the strait were also struck, the person said.
The strikes came shortly after the Trump administration revoked a license allowing Iran to sell oil on the open market, eliminating the primary economic benefit for Tehran as part of an interim peace deal with the U.S. and threatening to unravel the agreement after days of skirmishes in the Strait of Hormuz.
The Treasury Department said the June 21 temporary license granted to Iran after several months of war would no longer apply, a reprimand coming hours after the Islamic Revolutionary Guard Corps fired missiles and drones at ships near the strategic waterway Tuesday. The Treasury allowed for a grace period until July 17 for transactions already authorized under the license.
The revocation is a clear sign that Washington is willing to push back on Iranian military action and won’t offer new concessions to Tehran as part of the interim deal.
It also underscores how many issues the interim deal left open—or open to different interpretation by the two sides. That includes the critical question of who should control the strait and the passage of vessels through it in the coming months.
Meanwhile, people close to the talks say there has been no substantive progress made yet by the U.S. and Iranian teams on a final nuclear agreement, with technical talks on the issue barely commencing. Negotiations are currently on hold for the funeral of Khamenei.
Michael Singh, a former National Security Council director for the Middle East under President George W. Bush, said that Iran’s military attacks in the strait suggested Tehran was angling to get more early benefits from the interim deal than Washington had agreed to. The Treasury Department move is an effort to push back on that.
“So it seems that this construct where we hoped that Iran might yield control of the strait for a series of upfront concessions has only whetted the Iranian appetite for more,” Singh said.
He said all of this bodes ill for the prospect of a final nuclear deal. “I think the chances of getting that are quite slim.”
MOU Ends
