School of War - America’s Iran Problem Isn’t Going Away, with Mike Doran

Episode Date: July 14, 2026

Mike Doran, senior fellow and director of the Center for Peace and Security in the Middle East at the Hudson Institute, returns to School of War to examine why the war with Iran continues despite devastating military setbacks for Tehran. Is President Trump’s Iran strategy truly different from President Obama’s, or are the similarities overstated? What does the fight over the Strait of Hormuz reveal about the limits of American power? And what does this war tell us about the future of U.S. strategy in the Middle East—and its broader competition with China? 01:22 - Recap of the Iran War 06:03 - Iran's Leverage 09:05 - MoU Misunderstandings 12:28 - The Crux of the MoU Dispute 15:42 - The Nuclear Status Quo 17:58 - Iran's Degradation Since October 7 21:13 - The Democrats' View 22:02 - The Right's View 23:25 - Trump's "Obama-Style" Rhetoric 28:10 - Should America Reimpose the Blockade? 28:53 - The Drone and Ballistic Missile Problem 31:10 - Drone Warfare Has Changed Everything 32:01 - The Vulnerability of America's Gulf Allies 37:21 - Is the MoU Still in Effect? 39:34 - Why Nobody Is Buying Iranian Oil 46:32 - China and the Bigger Picture Follow along on Instagram, X @schoolofwarpod, and YouTube @SchoolofWarPodcast Find more at The Free Press. Learn more about your ad choices. Visit megaphone.fm/adchoices

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There's a lot of news about Iran. and the American-Iranian struggle for the Strait of Hormuz. We're recording this episode at 8 a.m. Monday morning, July the 13th. Mike Duran joins us to understand what's happening tactically in the Persian Gulf, but also strategically with the war and how it all fits in to the American struggle to maintain its position in the world. Let's get into it. It is a perspective for war, this Lockheon invasion of Hawaii.

A date which will live in him. A bloody experience of Vietnam is to end in a state. We continue to face the rain situation in France. The fight on the beaches. We'll fight on the landing ground. We'll fight in the fields and in the streets. We shall never surrender. The Hulu original series Furious is coming to Disney Plus.

Starring Emmy Rossum, Furious follows FBI agent Alice Black on the hunt for a mysterious and calculating serial killer. Both walk their own paths toward justice, and as their lives start to intertwine, the line between right and wrong begins to blur. Don't miss the three-episode premiere of the Hulu original series Furious on July 27th,

only on Hulu on Disney Plus. Hi, I'm Aaron McLean. Thanks for joining the School of War. I am delighted to welcome back to the show today. Mike Duran, Mike, of course, is senior fellow and director of the Center for Peace and Secure. in the Middle East at the Hudson Institute. He has been following the twists and turns of the war with Iran closely. We've checked in with him before.

Mike, it's great to have you back today. Great to be here, Aaron. There's so many ways we could go from here. There's so much to talk about. I thought I might open by hitting you with my back of the envelope periodization of the war so far and get your reaction to it. You had a really interesting piece in the free press right as the MOU was getting signed about where things stood and how we should assess them. And so we'll end up

in the phase we're currently in. But I want to get your reaction to this overall scheme. So the war begins, sitting aside all of the planning and cogitation, the war begins on February the 28th of this year. And phase one, I actually don't know how to end date it. But phase one seems to me to last from February the 28th to whichever day the administration begins to believe that whatever the theory of rapid victory was that they had is probably not going to come to pass. And there was a really interesting report in the New York Times this morning about Israel and Mahmoudah Medina Jan that maybe we could talk about that seems connected to that. But there's some theory of the case that victory will be extremely swift. It will look a bit like Venezuela. And phase one is February 28th

through the day that hopes of that fade. Then from that day through to April 7th, we have the rest of the main part of intense military action. From April the 7th, to 18 June. We have the period of the ceasefire with the dueling blockades for most of that time, the Iranian closure of the strait, the American blockade of Iranian ports. And then from 18 June until some point in the last week or so, we had the period of the memorandum of understanding, which was meant to open the straight, didn't really resolve any of the other issues. Turns out, in retrospect, not really to have resolved the issue of the straight either. And now, Mike, we are at the dawn of some new phase, the parameters of which are being negotiated to include with bombs and missiles as we

speak. So what do you think? Any major or even minor objections to that? What is the shape of what has just happened, I guess, is what I'm driving out? I think, no, that sounds pretty reasonable to me. There's a lot we don't know, you know, about. the regime change plans of the Americans and the Israelis. They clearly had one, and it didn't come to fruition. But let's put that aside. When was Easter? Was that around May 5? Was that the early April, early April, or April 5, April 5 it was. That's sticking in my head. Yeah, I always think of the turning point as the moment when Donald Trump was standing next to the Easter Bunny and threatening the

yeah yeah that I remember that that was an incredible TV visual only in 2026 only in the Trump administration moment yeah and I I actually think that was so that was Sunday April 5 if I recall correct I may have the dates wrong I think I read in the newspaper that there was an a an NSC meeting on Saturday night and I I tend to believe that that was a crucial NSC meeting because I think that's where Trump basically decided that he really wanted to de-escalate. And remember it was either on that, either on that Sunday or the following Monday that he made the, I'm going to destroy a civilization tonight. I remember vividly. Yeah. And I had, I had the opposite reaction of everyone else regarding,

I mean, there was, there was, the outrage machine was, was accused Donald Trump of war crimes because he was going to wipe out of civilization. I don't even know what that meant wipe out of civilization. He was, on the Tuesday was going to be the bridges and power plant day. That's what he was threatening, that a major escalation to bridges and, and power plants. But I thought that that was, that violated the, the, you know, the rule of, you know, the, you know, the rule of. if you're going to shoot, shoot. If you're not going to shoot, then you talk. So he was talking too much. And I think signaling pretty clearly that he wanted a deal and he wanted it out. So I think that was the turning point. And the way I understand that

is that he turned to his military and said, how much longer is it going to take? And they said, well, we need three or four weeks. and then he said, if I give you three or four more weeks, can you guarantee me that we are going to compel Iran to give me what I want? And the number one issue for him has always been the nuclear question. But in the course of the war, it became two things, opening the straight and his, and an end to the nuclear program.

And I don't think anyone could promise him that. And even if there were voices that were promising it, I doubt that he believed them. And that is, I think, that's the crucial turning point right there from the American point of view. From that point on, Donald Trump has been seeking not to compel Iran to give him everything that he, all of his stated war aims, but really just to manage the conflict. And if you had on the other side of the table a group of people who perhaps rationally assess the damage already done to their country's military capacity, the suffering of the Iranian people, et cetera, and who were willing themselves to pursue a way out, maybe a way out involving some compromise on both sides would be possible. But it seems, Mike, sitting here now approaching the middle of July, that that's not the case and that the perception. that the president wanted a way out, which I agree with you, becomes apparent sometime around early April, actually fuels their aggressiveness, in particular in the straight, in that they have

a kind of theory of the case, a victory of their own. It may be a bit mad, considering, again, how much damage Iran has suffered, and maybe you can walk us through sort of the achievements of the American military campaign, but they seem to me to see it as if we walk away from this as controlling the Strait of Hormuz, we walk away as de facto regional hegemon's because the Gulf states will on some level have to tow the line with us if we have that leverage over them.

It may be mad, but it's a theory. That might be the case. Can I present an alternative framework? And I don't present this as this framework as something that I'm certain about. But just as a framework for analyzing things, I think it's useful if we divide it into the conflict between us and the Iranians into final status questions. And by that I mean final status of the nuclear program,

the final status of the regime over the strait of hormones, the final status of the American sanctions regime and so on. There's those really big picture strategic conflicts between the United States and Iran. And then there's a second frame, which would be the fight over the MOU. The memorandum of understanding is really a memorandum of misunderstanding. And so there's an American interpretation of the MOU and the Iranian interpretation of the MOU. And let's just assume that right now what we're fighting over is the understanding of the MOU. And most important of all, we're fighting over the clauses about the straight.

They were left really purposely ambiguous because we're, We gave the Iranians, we made a major concession to the Iranians in that they could carry out negotiations with the Omanis about the final status, leaving open the possibility of them treating the strait as an Iranian waterway rather than open seas, as it has always been. But we put in, as a concession to us, the Iranians put in that maritime traffic, that they would not impose any fees for 60 days during the term of the MOU, and that traffic would return to the pre-war levels. So there was some ambiguity here because clearly what they wanted to do was the Iranians wanted it, it was ensure that any ship that wanted to transit, during the MOU, under the terms of the MOU, would do so along routes prescribed by the Iranians and in consultation with the Iranians, whereas we're saying, no, no, no, these are free and open waters and free passages, is everyone's right. We assumed, or I guess hoped, that the pressure on the Iranians, the economic pressure, the military pressure, and so on,

would make them so desirous themselves of opening the strait that they would allow free passage during the term of the MOU. And then I think Donald Trump calculated, and I think this was not an, this was an intelligent calculation

that if the MOU continued indefinitely, we were going to be, we were going to benefit much more from the MOU than the Iranians were. And so what's happening right now is we're fighting over that clause of the MOU over whether they actually get to determine the routes or not. And how that's going to play out is really not clear to me. Because Donald Trump is still in the same position he was in on April 5 on Easter,

which is that he doesn't want to escalate enough. the amount of escalation that he would have to engage in in order to change the calculus of the Iranians is going to impose a higher cost on the United States than he wants to then he wants to pay. So let me just read the text of Article 5 or Paragraph 5 here of the MOU. We've discussed it on this show before, but it bears repeating because it is, I agree with you completely, it is the crux of this whole dispute that we are in right now. Upon the signing of this MOU, the Islamic Republic of Iran will make arrangements using a best efforts for the safe passage of commercial vessels with no charge for 60 days only.

Can I stop you right there? Yep. Sorry to interrupt. I think that make arrangements is the key phrase behind which there is behind which there's hiding two radically different interpretations. I'm sorry to interrupt you, but I think make arrangements. That's the key part. What does that mean?

And the negotiators knew that, uh, that they were, uh, that they were hiding, uh, you know, a lot of constructive ambiguity or, um,

or unconstructive ambiguity. I, well, that, that was the key part with no charge for 60 days, only from the Persian Gulf to the sea of Oman and vice versa. And then it's a bunch of, you know,

verbiage about, um, uh, the timeline and the expectations, but they make it, that Iran will make arrangements. I agree completely is the crux of the whole issue because you could see two ways to read that.

If you're, the Iranians, the way you read that is, clearly the implication is this is our zone. This is our, how does one make arrangements in a place that is not yours? That's their interpretation, not totally irrationally, I would say, based purely on the text of the paragraph. You could also see a different reading, a more strained reading, in my view, where it is sort of a make arrangements is a purely technical phrase, direct. at demining and removing obstacles that you've placed. I don't actually, I think that is a strange reading because the phrase itself implies a much broader responsibility to coordinate with shipping.

I mean, it's not there explicitly, but I think it's very strongly there implicitly. And so you do end up with the, well, with the situation that we're in and with some textual justification for both sides, but I would say on balance with the Iranian side. And it just shows one hesitates to throw words like desperation around. But let's just say the real urgency of the American side, of the American team negotiating this to get something, anything signed that from their perspective was going to resolve the short to middle term issues well enough that we could transition to a discussion of long term issues. Yeah, I don't know how much they really want. I'm a little bit more charitable to them than your language suggests. Because, first of all, I don't know that they ever really believe they were going to get to the big negotiation over the Iranian nuclear program.

I know that was Donald Trump's original goal, but he at a certain point realized he was not going to be able to compel them. and so like I said, there's another key article of the MOU. From memory, I think it's Article 9, but I haven't looked at the thing since it was written. But it talks about the nuclear status quo. So no change to the nuclear status quo. Again, like make arrangements, status quo is a very, very ambiguous statement. But from Donald Trump's point of view, what that meant is, all of the fissile material remains in the ground.

Iran is not enriching uranium. They haven't enriched uranium since Operation Midnight Hammer over a year ago. So that's one year. Out of the last 20 years, Iran has been enriching uranium every day, except for the last, during the last year. That's an achievement. And the MOU locks in that achievement indefinitely. I mean, the 60-day MOU is going to be renewed, at least through the midterm elections.

This is from Donald Trump's point of view. And during that time, they're not going to be enriching uranium. We're not going to have that knife at our neck. And they probably assumed that the economic pressure on Iran as a result of the war, and as a result of all the economic problems they had before the war, was so great that the Iranians would come toward the American. definition of the MOU on the straight just in order to get economic relief and then the final status would be determined later. But clearly that was a miscalculation, at least at this point.

We don't know how the economic thinking weighs on the regime, if at all, but they are objectively in a very, very difficult situation. And I can't see how this insisting on control of the straight is going to help them in the long term. When you're a mid-sized business, you need every competitive advantage you can get. Like an AI solution that works for you, not against you. SAP Grow is built with AI embedded at its core, working across every system. And it's ready to go from day one so you can hit the ground running. Bring it with SAP Grow, AI Cloud ERP for any size business.

Okay, so let's talk about the road ahead then and what your thoughts are in terms of what needs to be done. And I'll begin by sort of zooming out completely and giving what I take to be a summary of your view here, which is that let's start the clock. Let's go way out and start the clock on October the 7th, 2023. From that point till now, the power position of Iran in the Middle East has been massively degraded. Iran begins this period as a meaningful competitor for regional hegemony, not as a competitor in its own mind sort of divorced from its hard power capabilities or lack thereof. Like, no, very serious hard power capabilities, massive missile arsenal, active nuclear program, a neo-imperial regional network of proxies capable of doing real harm to American allies, American forces in the region. a country on the march. From then till now, it has been just punishing the Iranian economy in even worse.

I mean, it's not like things were going gangbusters in 2023 for the Iranian economy, but in even worse shape, you know, running out of water in Tehran, for example. The Iranian nuclear program absolutely battered between Midnight Hammer and the 12-day War in 2025 and further strikes during Epic Fury, absolutely hammered. Iranian military capabilities. Somewhere on a spectrum from destroyed to degraded. The Iranian Navy will say effectively destroyed missile capabilities will say degraded, sort of somewhere on that spectrum.

So just hit after hit after hit. We enter this phase with epic fury of extraordinarily ambitious operation that will do a little bit of inform speculation here. We're sort of relying on reporting in places like the New York Times about the South Medina Jad Gambit from the Israelis and this Israeli regime change campaign that there's this extraordinarily ambitious gambit. We don't know the details of, really. It doesn't seem to come to pass. And as we get further stuck in on the campaign of Epic Fury, it becomes clear to the president that he, in his view, has overextended. And so we enter a period of retreat on the level

of extension we reached on Epic Fury beginning in early April. We are seeking ways to stabilize the situation and preserve the gains that have been made since 2023, the gains overall and keep Iran on its, keep the regime on its downward glide. And now we just have this, this, this, the thorn in our side, the knife in our neck is not really the nuclear program, which is, in fact, pretty battered, but for the presence of that highly enriched uranium, which we should talk about and what the significance of that is, but for the fact that the Iranians just will not let go of the straight. And that is the problem. That is the problem for American policy that faces us today. So one, please, you know, respond to my attempt to give the Duran, the Duran view, as I understand

it. And two, what do we do? Like, what are the options going from here? So, yeah, I think you presented my view pretty clearly. The issue comes down to the question of utility of force, I think. And our debate is divided into two camps. I guess three camps, the third one is the one I'm in, and it's pretty small, I think. You can tell me how else is there. That's always your situation. That's why we love you, Mike. One camp is the Obama camp, Obama Biden camp, and they look at the MOU and they say,

this looks, you know, a lot like a lot like Obama's JCPOA in their minds. They draw parallels. And they say, we told you all along that there has to be negotiated. There's no military solution. And you could have got this deal without

the war. And you would have the straight of harm was open. So it's just you've gotten nothing. You've made the situation worse. And then you realize that you have to go the Obama route. I don't know if we need to bother arguing against that, but I think that is a load of garbage, to be honest with you. I mean, to put it, to put it clearly, bluntly. And then there's the

people that I usually agree with who are more hawkish on Iran, those of us who always believed that Iran was not going to give up the nuclear program without a fight, without a really significant fight, that it had to be rested from the talons of the regime. And those people, my erstwhile allies, are really very gloomy these days. A lot of gloom and doom. They're almost, I call them a catastrophes. They, I guess they got excited by the regime change rhetoric that came from Donald Trump and Prime Minister Netanyahu,

and they sensed an opportunity to really solve this problem once and for all. And then Donald Trump took a step back, and they're very disappointed. And I think they also feel that they feel the hot breath of the Obamaites on the back of their neck. And they feel like the fact that Donald Trump

didn't go the distance, didn't continue the campaign, validated the Obama argument in some ways, you know, in the public mind, and we'll never go back to the, we'll never be in a position like we were in early April where we might have actually had a definitive resolution of this problem. And they're further demoralized, Aaron, because of the resort that Donald Trump and particularly Vice President Vance, have, they've resorted to Obama-style rhetoric at times, saying, you know, about the, unfreezing of Iranian assets, well, it's their money, not our money, there's no, there's no military solution to this, blaming Israel and putting some distance between the United States and Israel and so on. Using a lot of JCPOA style rhetoric has been kind of jarring and demoralizing to

people. And I got to say, I mean, I don't like the JCPOA style rhetoric either. I think it's a mistake. I think it's an inaccurate presentation of the strategic thinking of the president and so on. But I do not believe, as many of my allies do, that Donald Trump suddenly became Barack Obama. That didn't happen. The president has ordered three major military operations against Iran and its allies since he came to power. This time, came to office this time. We had Operation Rough Rider against the Houthis and then Midnight Hammer together with the Israelis last June and now Epic Fury. That is not Barack Obama.

And the fact that he has stepped back from major military operations for the time being doesn't mean that the JCPOA has been validated in any way in my mind. And I agree with what you said. Objectively, Iran is a lot weaker. Objectively, the Iranian problem is more manageable. We do have the Strait of Hormo's problem. It's a serious problem. I don't want to minimize it. But, but, but Iran is not on, Iran is not on the, on the, Iran is not a rising power.

The United States is a rising power. The, uh, Israel is a rising power. Not Iran. But this, this problem is a big problem and it has to be, um, if not solved, at least parked in a more acceptable place than it is right now. And so your, your reference to Operation Rough Rider is kind of what gives me. me pause because the thing about Rough Rider and the way that it ended, you know, shows something about, I think, what has been the de facto approach to war from this president, which is that it's,

and you saw it in his rhetoric during the peak of Epic Fury is this is something that the United States of America can choose to turn on and off. And in a way with Rough Rider, that was true. You know, Rabam and the heck out of the Houthis, it's presumably achieving some results here and there, but it doesn't look like it's going to achieve anything truly. dramatic, and at some point the president says, enough of this, enough of this, I see diminishing returns, we're just going to stop this. And he stops this. And you could argue that there were costs to stopping it precipitously in terms of the future of, you know, transit through the Red Sea. But the truth is, the consequences, any negative consequences that came from the precipitous

ending to Rough Rider were pretty muted, certainly in the United States, pretty muted. But the The consequences of the precipitous ending of Operation Epic Fury here, I think I'm giving voice to the group two of the three groups you enunciated, the Obama team, the Hawk team, and then the Mike Durant team. The precipitous end to Rough Rider, eh, maybe not great, but like life will go on, the world will go on. The precipitous end to Epic Fury leaving Iran, making this continued repeated play for control of the straight, that's not ignorable. that has negative economic consequences globally. It's very visible politically. It allows the Iranians to play this game in the media of humiliating the United States. It allows the Iranians, well, like we were discussing earlier,

it allows the Iranians to claim to their Gulf neighbors that in the long run, they're the horse to back because in the long run, they're the ones who are going to have their neighbors. well, school of war is getting respectable now, so I won't use the figure of speech I was about to use. They're the ones who are going to have substantial leverage over their neighbors in the Gulf, not the United States. And so it's a big problem.

My own take, Mike, is that we should consider reimposing the blockade, that if the Iranians are going to mess around and continue to try to impose their own de facto blockade in the strait, that we should genuinely return to that period that existed between early April and mid-June. and have the dueling blockades, because at least that will set up, that will risk all kinds of escalation. The Iranians will no doubt lash out, even more than they have been.

But at least there's a clock at that point, because I struggle to imagine the ways in which the Iranian economy can survive the long-term effective closure of their ports. Well, look, let's just define the strategic problem clearly. That's what, that's what I would like to do more than, more than anything, rather than argue with this camp or that camp.

Let's argue with what the, let's define the problem that we have. And I think the problem is twofold, but it really comes down to one thing. The problem is the drones and ballistic missiles of the Iranians and the difficulty of eradicating that capability. And that was also the problem with the Houthis. As I understand it, the commander of Sentcom, General Carilla, went to Donald Trump and said that if Donald Trump gave him, you know, X billions of dollars of munitions, he could solve the Houthi problem. I may have this wrong, but this is how I heard the story from a couple of reliable sources. And Donald Trump said, go for it. And he didn't deliver because these, because we don't have the capability to arrest it to, to, to, to,

simply eradicate the drones and and ballistic missiles. And that is exactly what's happened again in the Strait of Hormuz. The Iranians have not closed the strait. They are attacking ships with drones sporadically, and that has a demonstration effect, and the insurance companies will not ensure the shipping through the through the through the straight so uh we don't have we simply don't have the ability to eradicate all the drones uh the ballistic missiles are in these missile cities underground that are uh that are uh resilient and pretty much i think i gather out of our the range of our um of our munitions uh and the look you look at the problem the israeli are having in Lebanon with regard to the drones of Hisbalah.

There's no, no one can look at Hisvalon today and say that that organization is stronger than it was on October 7th. It's a shadow of its former self, but it still has the ability to get off these drone attacks, which are punishing to the Israelis and in some respect. Look at what the Ukrainians are doing to the Russians. Now, with their, with their drones, This is a change in warfare globally. These new disruptive military capabilities are changing the calculations of everyone, including the United States. And we have to hand it to the Iranians.

They have discovered an American vulnerability. We are vulnerable. It doesn't mean we are objectively weaker as a power. It doesn't mean that they're on the rise and we're on the decline. It means that we have a weakness that they have exploited. and it's a weakness that is not easily that we can't solve in a day. We can't just say, oh, we recognize the weakness, and now we're going to take measures to make it go away.

These are defense industrial questions. These are technology questions. These are force posture questions, really huge things that take years to work out. The second aspect of their strategy, that we, I don't think we understood what a problem it was for us, is the vulnerability of our Gulf allies. And in particular, their, in particular, their civilian infrastructure, desalinization plants, data centers, and, you know, energy production infrastructure. We don't have the capability to protect all of that like we would have liked. I don't think we were completely aware of how, to what depth the Iranians were going to target

our Gulf allies. That's a change in their strategy. I think we assumed that they'd probably get a bit more of a past. And they got the Gulf allies themselves assumed that you can see. we don't have a good answer to either of those things. Like I said, on April 5th, Donald Trump's generals could not promise him that four or five more weeks of warfare was going to get him what he wanted. And he had to look at the possibility of massive escalation, where he was going to have to start targeting the defense technology and industrial base of the Iranians, civilian infrastructure, and so on. and they were going to respond, likely going to respond against the Gulf allies.

And it was going to get very messy and very ugly. Now, we're going to win that war in the end. We are. But it's going to be a George W. Bush-style invasion, or not necessarily an invasion of Iran, but it's going to have to take on potentially regime change aspects. And there was going to be a lot of collateral damage that even the Iraq war didn't have. And Donald Trump looked at that and he said, you know what? I prefer to try to degrade them over time.

This MOU, as ugly as it is, gives me a vehicle in which I can degrade them over time. So I'm not willing to go with you to say he should do X, Y, or Z until we look at the scenario that he was looking at and say, yeah, that's the scenario we want. Now, Donald Trump also wants to get reelected, or not reelected, but he wants to have a Republican wave, or at least he wants the Republicans to survive in the midterms elections in November. And I can't blame him for that. If he loses the Senate, then he's going to have, you know, we're going to spend two years with impeachment hearings again like we saw in the past. and he's not going to, it's going to completely hamstring the second part of his second term. And I can't tell him that that's what he should want. And I can't tell him that I can calculate better for him the domestic political implications of this choice that he made.

Where you hesitate, Mike, allow me, allow me to plunge in boldly. Okay. You know, from the president's, from the point of view of his total calculations, that is to say, including his American domestic political calculations. if what you're suggesting on some level is just where we are is where we are, and it's going to be some version of this turbulence going forward, which is the implication I'm taking. So correct me if that's not right.

And that, you know, because of the risks of escalation, let's say we reimpose the blockade. Well, that sets us back on a cycle ultimately where the question is finally called, and we do have this just very bruising regime change, economic warfare situation where the Iranians are responding in the Gulf. And so the president for for has seems to be calculating. He's just not going to take measures like that to avoid the messiness of that. Um, uh, uh, in part because of his own political calculations.

I mean, I could respond to that and say that the situation in the straight lasting indefinitely, lasting through November will have negative effects on global energy markets. Um, and is a constant ongoing political humiliation, which the president's, political opponents, the Democratic Party and his critics in the Republican Party, will make hay of every single day between now in November. So it's not, it's not, it's not, it's not, it's not, it's not, it's not, it's not, it's not, it's not, it's not, it's just not quo, the situation today of this, you know, in the last, what, 10 days or so, we've seen multiple Iranian strikes on hits, multiple rounds of American response. The American responses, by the way, are getting more and more intense. I think it was like the first one we hit 80 targets. The next one, we hit 90 targets, then we hit 100-some targets Saturday night, and then the shooting's

been going on through Sunday. So I don't have an account yet of everything that was struck in the last 24 hours, but it's pretty intense right now. It's not, I saw it described in the press this morning as tit for tat. I'm not, there's just some pretty big tats going on. I have a, I agree with most of what you say, but I have a slightly different interpretation of what's going on right now and where, and where I think it will, we'll end up. Where, where Donald Trump once it they end up, and I think he has a chance of getting it there. First of all, I do agree there's been an intensification, and we also, last week at some point, I can't remember what day, we removed the blanket waiver on oil sales.

Right, that was huge. We should have mentioned, I should have mentioned that up at the top. That was really the death of the MOU was the removal of that waiver. So the sanctions are back on, but just not the blockade right now. No, see, this is where I disagree with you. is that I don't think the MOU is dead. I think we are still fighting for the MOU. We're fighting over the interpretation of the MOU. Yes, there's been an intensification of the strikes by the Americans.

But what I look for with these strikes is a new category of targets. Because what they're going after are, according to CENTCOM's statements, launchers, stockpiles, and so on. So they're going after the disruptive military capabilities, the drones and naval drones of the IRGC, and so on. And in that regard,

whether they hit, you know, 10, 20, or 200, I think the number I saw this morning was 300, if I'm not mistaken, targets. These are, this is not going to change the calculus in Tehran. This is, at this point, this is signaling that we're serious and we are going to, and we are going to insist on our definition of the MOU, but it's not serious enough to change the calculation

in Tehran, in my estimation, in my assumption. Well, then why are you, why are you so, you're not embracing the McLean-reimposed the blockade plan, which to me would be taken seriously, it seems. I think there needs to be an escalation in targeting type. No, why am I not? Because I don't think the blockade matters that much. Because what the Iranians found, and it's one of the reasons why I think that they're upset with the MOU, is nobody's buying their oil.

The Chinese, very interesting development, we also should have mentioned earlier. The Chinese are not buying Iranian oil, Aaron. and so and this was I think a very smart thing that Donald Trump did with the MOU is he calculated and Scott Bessent, the treasurer secretary calculated that Iran is not going to have, it's not going to find a lot of buyers for it for its oil. You know, oil, you can't just plug any kind of oil into any refinery. Refinery is our tomb. and that means that's not just turning dials. They are constructed to deal with the properties of oil that comes from specific places. In recent years, everybody except the Chinese has gotten off of Iranian oil. And so no refinery, say, in India wants to take out.

Well, India is used to refine a lot of Iranian oil. None of them want to take it on because this is, The MOU lasts 60 days. I mean, we're seeing the volatility of this thing. No rational economic planner wants to get in bed with the Iranians, wants to make a capital investment to attune their refinery to Iranian oil, only to find out that the United States is going to slap, you know, is going to remove the blanket waiver as they just did.

So people aren't rushing to, you know, They're not beating down the doors of the Iranians to buy their oil even at discounted prices. And remarkably, the Chinese are not buying the oil. And they bought a little bit. How do we know that? Because, I mean, you never, I mean, the information environment is so confusing out there. And I'm not going to claim to be in any way, like a sophisticated consumer of data or news about who is buying what on the energy markets. But you do see, you know, you see reports of Iranian ships.

going dark off the coast of Malaysia and the sort of the, that's the old route to the teapot refineries in China. Like, how do we know they're not buying oil? By the, by the people who tracked this, there's been a couple of very credible reports about this. There's one Bloomberg report that, that sticks in my mind. The, what's opaque, by my reading of it, the opacity is not whether the,

the Chinese are buying or not, but what's the source of the Chinese policy? Part of it is, we don't know, but one supposition is that the Chinese have dipped into their massive, they have a huge oil strategic reserve, perhaps the biggest in the world, and they have dipped into that. The second is that they have moved toward electrification of their cars and trucks. And so they're using actually less gasoline than they were before. In addition, they may want to avoid sanctions from the United States. They may be concerned about that.

there may have been discussions between Trump and Xi Jinping about this. I don't know. But I think it's pretty clear that there's no big windfall for the, for the Iranians. And even if people start buying it, the Iranians have to get that money to Iran. And their system is incredibly complex. So they're not, you know, at best they're going to, at best they could get back to the, to what existed under the Biden administration, but they're a long way from that. And as long as we're in this world of 60 day rolling MOUs, it's going to be very hard from there. They're going to sell some oil, for sure. They're going to sell some oil, and they're going to get some money from it. But when you compare the amount of money that they could possibly get from their oil sales to the amount of, to the

destruction that was caused by the Israelis and the Americans in the war, they are a long way from They're going to have an, the process of rebuilding their economy is going to be, is going to take years. So, yeah, this was all leading somewhere. Oh, so no, no, the, the, the, the, so this is why I think the blockade is not that big of a deal. They're, they're basically still under terms of blockade, I, I think. What Donald Trump has to do to change their calculation is he has to start targeting their defense technology and industrial base. The Israelis and the Americans did a little bit of that during the war. the steel industry and they hit the petrochemical industry. They didn't wipe the two out. That was signaling to the Iranians that we could cause massive dislocation,

you know, massive unemployment, complete shutdown of their economy. If we hit Carg Island, if we hit the defense technology industrial base, we hit the power plants and bridges, and we hit their petrochemical industry even harder, that could potentially change the calculation, but that also risks the escalation. So I think in order to get the American to impose on the Iranians, the American definition of the MOU, there's going to have to be an escalation in kind, not just in scale, you know, from one target type to another rather than just increasing the number of attacks. Last question. We only have a couple of minutes. I apologize because this is a big question. I want to give you a moment to sort of place this war within the broader context of American power in the region and just the Trump administration's foreign policy more generally. There's a lot of other stuff going on. You know, the president was just in Ankara for this NATO summit, which went, I think, better than a lot better in terms of if you think NATO is a good thing, went better than most observers were anticipating and it did

pretty warmly ended with what seems to be increasing Trump administration warmth towards Ukraine and President Trump's personal warmth towards Zelensky. What does all this matter in the big picture, Mike Duran? The big picture is China. That's the question. And that's the number one reason why I'm comfortable with the MOU. I had in my mind a nightmare scenario before this whole thing began. and that was that Iran was going to place its nuclear program in a zone of what Marco Rubio called a zone of immunity behind this incredibly large missile arsenal that was going to make any effort to end the Iranian nuclear threat by military means impossible because Iran was going to impose such a high cost.

Secondly, I've always looked at the Houthi blockade of the Babel Mandeb as a Chinese-backed effort to control choke points. And it didn't get a lot of attention, but the Chinese and Russian vessels were transiting the Babel Mandev and the Suez Canal with no problem while I'm talking about Chinese and Russian cargoes, not necessarily flagged vessels, under the Houthis. during the Houthi blockade. So we were looking at a possibility that if there was a Chinese play to take over Taiwan, they could simultaneously block the Strait of Hormuz and the Babel Mandeb

and create a system that would allow Chinese and Russian vessels to get out, but to block all of the oil sales to China's rivals in East Asia, the Indians, the Japanese, the South Koreans, the Australians, and so on. Taiwanese themselves. That was a nightmare scenario, which I think has been disrupted by Donald Trump. There's a pronounced tendency in our analyses of the Middle East, Aaron, not to see Iran as part

of a coalition, China, Russia, Iran, North Korea, which is working to undermine the American order throughout all of the, you know, in all of the major arenas, East Asia, the Middle East and Europe. These are all interlinked. And I think when you look at what's going on in Ukraine and you look at what Donald Trump is done in Iran, I think if you're Xi Jinping sitting in Beijing, it doesn't look like the United States is weaker. It doesn't look like this is a great moment to go try to make a move for Taiwan. His Iranian allies and his Russian allies are objectively weaker. Mike Duran of the Hudson Institute, it is always fascinating to talk to you. I really appreciate you making the time this morning.

Thank you, Aaron. Great to be here.