The President's Daily Brief - PDB Situation Report | March 13th, 2026: The Strait Of Hormuz Showdown: How The U.S. Can Secure The Gulf

Episode Date: March 14, 2026

In this episode of The PDB Situation Report: First up — the war with Iran enters its second week as the air campaign continues and tensions rise around the increasingly volatile Strait of Hormuz. Retired Rear Admiral Mark Montgomery joins the program to break down the military situation and explain why the narrow waterway has become one of the most dangerous flashpoints in the conflict. Later in the show — global energy markets are showing fresh signs of anxiety as the fighting with Iran threatens oil supplies and commercial shipping in the Persian Gulf. Daniel Turner, Executive Director of Power the Future, joins the program to discuss the growing energy crisis and what it could mean for prices, supply chains, and the global economy. To listen to the show ad-free, become a premium member of The President’s Daily Brief by visiting https://PDBPremium.com. Please remember to subscribe if you enjoyed this episode of The President's Daily Brief. YouTube: youtube.com/@presidentsdailybrief HomeServe: Protect your home systems from costly repairs with HomeServe—plans start at $4.99/month at https://HomeServe.com.  Cardiff: Get fast business funding without bank delays—apply in minutes with Cardiff and access up to $500,000 in same‑day funding at https://Cardiff.co/PDB  ZBiotics: Visit https://zbiotics.com/PDB for 15% off Learn more about your ad choices. Visit megaphone.fm/adchoices

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inspired by a unique orchid accord, paired with vanilla, each with its own distinct attitude, each with its own universe, bold elixir, sensual, woody, addictive, magnetic elixir, sweet and romantic like a lingering touch, solar elixir, a radiant expression of joy, ultra-concentrated for amplified impact and lasting power. Find your euphoria. Discover the Euphoria Elixir Collection by Calvin Welcome to the PDB Situation Report. I'm Mike Baker, your eyes and ears on the world stage. All right, let's get briefed. First up, the war with Iran, perhaps you've heard about it, enters its second week with the air campaign continuing and new attention shifting to the increasingly volatile strait of Hormuz. We'll be joined by retired rear Admiral Mark Montgomery to get his insight,

and he's got a lot of experience and a lot of terrific insight. Later in the show, global energy markets are rattled as the war with Iran threatens oil supplies and shipping through the Strait of Hormuz. Daniel Turner, Executive Director of Power of the Future, stops by to share his expertise on the growing energy crisis. But first, today's situation reports spotlight. We're now entering the second week of the U.S. and Israel's war with Iran, and the military campaign continues to evolve. Coalition air strikes are still pounding Iranian military targets, missile sites, and infrastructure as the effort to degrade Tehran's ability to retaliate presses on. But increasingly, attention is shifting to the Strait of Hormuz.

Now, that's the narrow waterway that carries roughly one-fifth of the world's oil, and not to mention LNG. Iranian forces have stepped up attacks on commercial shipping, with the regime promising to choke off one of the most critical arteries of the global economy. It's essentially the Iranian regime's best and possibly only leveraged, point at this stage. Joining us to break it down is retired rear admiral Mark Montgomery, senior director of Foundation for the Defense of Democracies Center on Cyber and Technology Innovation. Sir, thank you very much for joining us again on the situation report.

Thank you for having me. We should start by talking about Iran. That seems to be the hot topic. This may be a strange way to phrase the question, but where do you stand on this conflict? I mean, from the very top, you know, 30,000 foot view, strategically, did it make sense? And what do you think will be the end game result? I know that's a massive playing field, but fire away. So look, if the president were to tell me my strategic goal here is to prevent Iran from being able to impose its will on its neighbors, its Arab neighbors in Israel, and affect U.S. national security interest in the Arabian Gulf, I would have said I'm in on that kind of war.

I would have been in, for one, on regime change. I don't think we set up the proper conditions for that at the beginning, so that's probably not an option. We can change how the regime acts, and I think that's what I'm for. So I do support a four- or five-week air campaign that removes their ability to fire missiles, that reduces their ability to fire drones, that's harder to remove, that reduces their maritime capabilities, that removes their air defense systems, that takes out some of their IRGC leadership

and capabilities, and that sets back their nuclear program again. With the goal being that, you know, for the next three, five, seven years, depending on which of those topics you're talking about, Iran can't impose as well, as it has been doing for the last three decades. It is the single source, single greatest source of malicious behavior in the Middle East, a Middle East that has been a pain in the butt. And so from my perspective, including by the way, remind people, they've killed a thousand American soldiers since 1983, you know, six or seven hundred in the Iraq conflict, but, you know, a thousand overall, three or four hundred of our NATO partners and a number of Israeli soldiers and a lot of Israeli civilians. So they are not a good actor.

But this isn't about retribution. This is about preventing them from imposing their will on the Middle East and on U.S. security interests in the Middle East for the next three, five or seven years. And in that case, I am okay with this conflict. Based on what you are seeing in terms of the results so far of the campaign, is there a way to kind of say, I think we've pushed the ball down the field in five years, seven years, further than we have at any time in the past, you know, 50 years? So we have pushed it further than we ever push it, that's for sure, because, you know, we're probably not, you know, eight or nine thousand strikes into it. But we have not accomplished what we need to accomplish.

I mean, one of my greatest concerns is right here to president say, we won last night in Kentucky. I mean, first of all, wins a tough thing to say exactly in this kind of conflict. But we're winning. I'd go wrong with that. we're achieving a lot of mission, but we haven't won. And in fact, the most dangerous thing, right now, we're at a very dangerous point. Iran now recognizes that at risk is its control of the straits over moves.

They've controlled it for 40 or 50 years. That's at risk. And they're going to fight for that, I think, and act to maintain their control over that. It's more important than ever that we keep pressing through with these attacks so we can set the conditions that two weeks from now, we control the Straits of Hormuz, and we bring shipping through. And we tell the Iranians, this is going to happen. If you stick your head up, it'll be whack-a-mole and we'll knock it down. But we're going to bring these ships through here.

But we're still two weeks away. And my largest concern is that sometimes when the president says we won, the next word out of is about our cease operations. That would actually lead to a capital L loss for the United States. for our allies and partners, because very quickly we become clear to everyone that Iran remains and control the straits or Homoos at this very, you know, at this time, we have not yet established our control over that. But how, talk to me about what that looks like.

What's that operation look like to actually take control of the strait? Because they don't have to close it, right? I mean, a lot of this is perception within the shipping industry and the insurance industry. So what does an operation look like for us to say? say legitimately we've taken control of the street. I like the way you ask that, because this is, this is about changing a perception that it's closed to a reality that it's open. So from my perspective, that's two lines of effort have to be pushed simultaneously.

The good news is they each end about the same time, sometime between March 21st and 28th, you know, 10 to 14 days from now. And that's the first line of operation is we degrade the military threat to tankers and U.S. Navy ships in the strait, and that is continuing to knock down the missiles, the mines, the drones, the small and man surface combatants that would threaten U.S. forces and the tankers in the Gulf. You've got to knock that down to a militarily manageable risk. The second thing that has to happen is we have to bring the right forces in to execute the

convoy operations, and that is an unblinking eye that looks, you know, 50 miles either side of the Straits and 100 miles back, and we have that in place. The second is that we have combat air patrol, probably either two or four slots, which means four or eight aircraft persistently overhead whenever we're convoying with F-15s, F-16s or F-18s, equipped with that's called the Advanced Precision Kill Weapons System, APKWS, a cheap rocket, a 25,000-on rocket, that is extremely effective against the Shahid drones. It's used extensively by Ukraine.

It's used extensively by us over the last two years in the Middle East. It's effective. And in a maritime environment like that will be very effective. The third thing you need is armed heloes, probably operating off of ships that have rockets to take out the ships. They're backed up by the aircraft, but if a small boat comes out, helicopters have a field day with it. And then the fourth, and the most important,

and the one that does not exist at this moment is 10 to 14 large surface combatants. You know, we know them as ages destroyers, like the Arley Bird Class destroyers you're seen on the TV, launching the Tomahawks. Those same ones have a great air defense system. They're the perfect escort ship. I think 10 to 14 of them is kind of the right number to at least get the initial choke, you know, the 250 ships that are stuck on the inside the Gulf out. And, and eventually, not initially, of course, will be joined by allies.

and that probably the British, the French, we really ought to be joined by the Japanese, Koreans, and Australians who all have ages destroyers themselves and would be fantastic. We'll have to see if that happens. And so, to me, once you have both those lines of effort in place, then you have control over the straits or Hamoos. This is going to sound odd, but do you see a role,

I mean, given how important the strait is, I take a point by the Japanese, you know, South Koreans, you know, particularly because of LNG movement through the straight. But do you see a role for China, for the PLA Navy to, I know this is going to sound odd, but to partner with the U.S. on something like this? No. And along the answer. Really?

You don't want to think about that? Okay. No. Listen, we're fighting for authoritarian states right now. China, Russia, North Korea, Iran have been allied. You know, Ukraine would tell you today. they are fighting Russia, China, North Korea, Iran in that order. And Iran was armed by China and Russia.

After Israel bombed them in the 12-day war, China began to feed back in precursor agents to rebuild missile defense systems. Excuse me, ballistic missile attack systems. I'm sorry, China's an adversary. They have no interest in the U.S. being successful. They like what's going to the Middle East because it's bleeding us readiness-wise. you know, it's spending money, spending munitions. And here's the second part. China, since 1949, since the communists took over, has a track record of never, ever, ever

helping in any international organization or environment. They're cheap skates at the United Nations when it comes to pay in bills. I mean, we may not pay our bill, but at least we volunteer to have a big bill. They don't even do that. On top of it, they don't intrigue the security anywhere in the world. So the short answers no, the long answers no. And in fact, my biggest concern is that those guys are going to try to transfer high-end cruise. They've tried to several weeks ago.

I mean, there was. Yeah. Of trying to transfer high-end YKant YJ-12 missiles. Missiles that would really worry me in the straits. We're good at that cruise missile if you give me, you know, some time to watch it. But if you launch it, 10 miles away from me, I'm going to have a problem. So, you know, even in a high-end U.S. destroyer. So from my point of view, China is an authoritarian regime.

that has been no help, has no intention of actually helping, and if anything would make things worse. Yeah. Well, I love the answer because I couldn't agree with him more. And I thought it was, it was very, very eloquent. I'm glad you're in. Yeah. Thank you very much.

Yeah. And, of course, also, they are about the only ones currently receiving oil shipments from Iran. And, you know, obviously, they've also ignored the sanctions. on Iran and their energy industry for years. So, you know, they have no problems with that. Is that the way you've laid that out, the four or so steps that need to be done

to actually take control of the street. To someone like me who doesn't have decades of experience within the military conducting these sort of operations, It sounds like a lot longer than two weeks to gain control. Do you get the sense that the White House is already moving in that direction? Or do you get the sense that they're thinking to themselves, let's just declare victory, go home and hope that oil price is stabilized and gas prices stabilize at the pumps?

Yeah. I'm really afraid that the president is going to pull the plug on this. That would be a strategic error of the most significant one he had made in either of his presidencies. And what I mean by that is at that point, very rapidly, as I said earlier, everybody in the Middle East and everybody in the world would understand that Iran controls the straits over moves. and that is a significant, that would become a significant challenge for democracy, you know, for all our allies and partners, particularly all our democracies, everyone but China, who has special deals with Iran. So from my perspective, the last week, look, the president is doing great on this, you know,

that he has gotten out, he's given General Kane and Admiral Cooper the leash they need to do 900 strikes a day between us and Israel, to pursue. persistently attack. What errors happen, we've examined them and moved forward. We haven't become angst-ridden. We're doing the right thing. And look, do I think we could have planned better for regime change? You bet.

But I also think that might have been six months or a year from now, really, if at all. And probably politically timing-wise, it's the one time he could do this. I would tell the president, hey, take the two more weeks of heat. The dude, this dude is taking a lot of heat over the last 12 years, right? You know, I mean, so you can take two more weeks of heat. Take that heat and take the big win. The big win is after four or five weeks of combat operations, hammering this adversary, pushing them back,

three, five, seven years in those areas, establishing U.S. control over the straits over moves and saying we are the ones responsible for this security, telling the Iranians, here's the end game. It's not a peace, it's not a C-spire, it's not a treaty. We are going to control air defense, over your country, turn to China, Russia, and say, if you try to ship them weapons, we will shoot down the planes and we will seize the ships. You are not going to rearm these guys.

And then telling our allies and partners, thrive, telling the Arabs and Israelis thrive, expand the Abram Accords, become, you know, a prosperous Middle East without the Iranian knife, you know, snuggled in the ribs of your back. From my perspective, that's the long-term solution. The president's got to take that big win. Yeah. Well, I hope he's listening. In fact, I do hear that he's a big fan of the president's daily brief, although that might be the actual PDB, I'm not sure. If you could stay right where you are, sir, we have to take a quick break, and then we'll be back with more from Adam Mcgomery, right here on the PDB Situation Report. Hey, Mike Baker here, with an important message for homeowners. Now, if you're a homeowner like me, you know that things never break around the house when it's convenient. You know what I'm talking. about, like the heater that conks out in the dead of winter or the AC system gives out in the

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Joining us once again is retired rear admiral Mark Montgomery, senior director of Foundation for the Defense of Democracy, Center on Cyber and Technology Innovation. Sir, thank you very much for sticking around. Now, I want to stay focused on Iran, but I kind of want to shift a little bit to look at a couple of issues that have been cropping up, but not really getting, I don't think, as much attention as they should. The first is, I mean, everything's connected nowadays, right? Nothing happens in a bubble. The world is very small. The Ukrainians have been dealing with Iranian-designed Shahed drones for four years of Putin's invasion. And they've come out in recent days with an offer to assist with what's been happening

in the Gulf region, the number of drones being fired off at the various Gulf states by the Iranians. What can you tell me about that? Yeah, thanks. You know, I actually spend about eight weeks a year in Ukraine training with their military and helping them on some things. And so I've gotten to watch their counter drone capability up close and personal in a very protective way for myself. And they are impressive. They run a dual-level program. One is that F-16 aircraft with advanced persistent kill weapons, as I mentioned earlier,

and helicopters with those same rockets shooting them down. And that kind of covers wide areas. But that doesn't give you the kind of direct defense you need of like a high-value radar, air base, you know, military facility, presidential house, whatever it is. For those, they then have ground-based counter-drone systems. And they have cool names like General Cherry's, you know, bullet and mirrobs and octopus. But they're all pretty cool. I've watched them. They have a thing called the Nemesis Brigade,

a brigade-sized unit that goes and does all this counter-dron activity. And very impressive. They have five or six different at any one time, counter-dron things going. They're all 70 to 90 percent effective. So you fire two and you're really close to 100 percent. And they're cheap. They're anywhere from five to $15,000. And they're all kind of targeted at Shad, with the Russians that are called Jaran, but their Shahed design, as you've implied, Iranian drones. They have offered. So in the middle of their own cluster that they have gone with Russia, under attack, they're attacked every week by 1,500, ballistic missile, cruise missiles, or drones every week.

Way more than we're seeing in the Arabian Gulf, they see it every week for the last three and a half years for sure. And yet, in the middle of that, they're willing to give us people and equipment to do it. This is what the United States and our national security strategy calls a model ally, someone who spends a ton of money on defense, fights an authoritarian regime, and when you ask for help, gives it. We didn't even ask for it. They volunteered it to us and our air partners. They are a model ally.

That stuff will be highly useful. And then when the war is this current engagement's over, we need to sit back, study these weapons, do joint ventures, and produce them so that we have a, in Japan, in Korea, in Guam, in the, you know, Taiwan, the Philippines, as well as all over Europe. It sounds like, just in recent days again, that they've had a number of conversations, whether it's with the Qataris or Amanis or whomever, and that they are starting this process of contracting, sort of joint ventures, not necessarily to produce, but to work together and then maybe have these things produced in Ukraine, which of course helps the Ukraine economy and it needs a lot of

help after this past four years. Do you get the sense that there is sort of the Gulf states are welcoming this with open arms or how quickly can this come online in other words? Well, look, the Gulf states traditionally look to us first for a weapon system, whether it's a F-15, F-18, F-35, F-16. They buy from a... us, that patriot they buy from us. We don't have a counter drone capability. So now they're looking to another potential ally or partner in Ukraine and do it. So I 100% think it's going to happen. I want 100% that once, not just the Arab partners, are European partners. They're already doing a little bit of it. Like the octopus is a joint UK Ukrainian catar drone being produced.

But U.S. companies will be in joint ventures and Asian companies. will be doing Asian countries, we do it as well, you know, Taiwan, Japan, and Korea. So I 100% believe that this Ukraine technology to get there. And I got to tell I'm impressed. Every time I go there about once a quarter, every three months, it's generationally changed. Both the drones and the counter drones are evolving, evolving in a way that our defense industrial base, a level of agility I've never seen in weapon systems, whether it's software or hardware.

It's really impressive. So, yes, I think this is a long-term solution. and Ukraine is a model ally. Is that a failure in strategic thinking or planning on the part of the U.S. government that we don't have a robust counter-dron program? Yes. Unfortunately, you could see this start. The Azerbaijan-Armenia conflict of 2021, you could see the edges of this, where Azerbaijan really was very aggressive in using these drones, and there was no answer for. But we didn't really respond to that.

But now, you know, there's no excuse that three and a half, you know, four years into war, three and a half years into a big drone part of the war, that the United States had not altered its procurement system. I'm going to give Secretary Higgs some credit here. And I'm often critical of them, but I'll tell you he was his new, his vision for how you change military procurement and acquisition is critical. We've got to get it in place. we've got to be able to put small amounts in smaller contracts like I got our drone one quick investments quick hitter investments maybe they fail it's okay but you do multiple bets and then one or two or three of these delivered the good news is the Ukrainians already did the

testing for us we know which ones are going to succeed because we literally are watching them succeed yeah yeah you would think that that would give us the ability right to to almost bypass i don't once they completely, the research and development phase, but get straight into the manufacturing aspects of it. But sticking with the Ukrainian conflict, well, sort of. I mean, we're focused on Iran, but there have been some reports talking about Russian support for Iran during the course of this conflict that kicked off on the 28th of February. And the initial reports suggested that the Kremlin was providing intelligence support in terms of location of U.S. assets, for the Iranians to do this. The White House was fairly dismissive of that. I don't know whether

it's because they just didn't have or believe that the reports was credible, or perhaps they didn't want to drag Russia into what's already a complex conflict, and so they'd prefer to just publicly say it's not happening. But now the reporting seems to be. indicate that it's more than just intelligence sharing, it's also tactical assistance in terms of how best to carry out these drone strikes. Because on the other side of the coin there in Ukraine, obviously, you know, the Russia has had four years of experience on the offensive side with the drones. So what have you heard about that? That was a long, you know what? I talked for about two and a half hours there just to get to the question of what have you heard about that? Oh, well, look, I like

what you said. I heard the same things you have. And what I'll say is, what I said Ukraine was a model ally. I'll now say Russia is a model adversary, right? That literally, they, why would we think anything other than this is happening? Ukraine has helped, I mean, excuse me, Iran had helped Russia so much. Those Chehade drones, not just the several thousand drones they transferred. They then gave the intellectual property to build Chehed factories in Russia, where they now have evolved into Jaron, you know, they call them the Jaron, but two, three, and five drones and that are hammering Kiev and Leviv every other night. So it's, why would I think anything other than that? I, I 100% believe Russia is assisting Iran. If China and North Korea could assist, they would

as well. They're assisting Iran. They're a model adversary. When I hear Steve Whitkoff say that, well, Putin told me he's not doing it. You know, that's like I hear it. Hey, well, year old said he didn't take the cookings. Please, come on. He Wickoff said he heard it, and then he repeated and said, well, you know, and Putin told the same thing during a phone call. And then I heard it again from Yuri Usakov. He told me that they weren't doing it. And I thought, well, there you go then. If they're saying it's not happening, I'm sure we can take them at their word.

No, no, absolutely. I don't trust Putin as far as I could throw him out a four-story window. No, sir, it's a 14-story. All his all his, all his, A lot of 14-store buildings, but okay, yeah. Sorry. No, you're right. There's a significance to it. So I guess it, last question, if I could. And I know there's some speculation involved in this.

But if we're talking in two weeks, Todd, right? Do you get any sense? Do you see anything so far? that tells you that there is a willingness on the part of the existing Iranian regime to finish this, to exit. Or do you get the sense that now we're in a position where we could declare victory, meaning the White House could declare victory, but it won't matter because the Iranian regime sees the Strait of Hormuz, and unless what you're saying, unless that scenario is played out, they continue to control the Strait of Hormuz. moves and they just do that until they can extract as many concessions as possible. Yeah, you're absolutely, this is the, so two weeks from now, we fast forward. If we have not established those conditions, we can't end the war.

I mean, this is the problem. This is why you have to establish those conditions for the exact reason you said, if you do not, if we don't have control the Straits of our moves, the IRC is still going to think, you think I'll be like, you've taken off an arm in a leg, but I'm still going to fight you. You know, and so, you know, my concern here is that, you know, we're going to have to, you know, it's not like at midnight on the 27th of March, boom, we're done. It's got to be the conditions are set.

Now, we can negotiate. Now, here's my one hope. We apparently, judging by the fact that we were monitoring traffic light cameras, we were jamming cell phones when we needed to for that strike, I've been to guess we've been listening to their communications. And I have to believe in the last two years, we've caught at least one senior IRA. G.C guy like calling his wife going, you would not believe these crazy dudes I work with. We got to, where's our money in the Cayman Islands exactly? You know what I mean?

Somebody going, yeah, we realize, okay, that's someone who is not an ideologue. Yeah, he was in it for the money or in it for power. That's the person. That's our Delcy Rodriguez. And we've got to go grab that person and, you know, kill the people around them to create the conditions where that person is, we can then deal with that person. Because honestly, at this point, We're probably going to have to find someone we can do it. It's not going to be the Supreme Leader's son. I believe we just killed his father, his mother, his wife, and his nephew in the last week. I don't, if he is alive or not unconscious in a coma, he's probably not a future American partner.

We've got to find the person he can work with, and then we've got to set the conditions where that person goes, I'd like to speak to you. And I'm willing to accept some conditions that we have not accepted in the past. Yeah, I couldn't agree with you more. We need a fracture within that, particularly the IRGC, which typically over the years they've been considered true believers. But I like what you're laying out there. You would have to think that there are some individuals who go, that's enough, this is it, right?

I mean, A, I'm not an ideologue. And B, this is the only opportunity. At this stage of the game, we've been hit so hard that if we can't, you know, I guess you're talking about mounting a coup or whatever, however you want to refer to it. But the people of Iran need that top cover. You can't ask them to go back out in the streets and get slaughtered by the thousands again when there's still an existing security apparatus.

But if you do get that fissure, if you get that fracture there, so I think you're spot on there. Sir, this has really been fascinating and very much appreciate you coming back on. And I hope that when we call you again, you'll be willing to pick up the phone. anytime this is a great conversation i'm glad that we got iran and ukraine and you know really all the conflicts going on right now it's a good summation yeah excellent thank you sir admiral mark montgomery we'll have you back on i hope very soon and i hope that when we do we'll be saying they've implemented your straight of poor moves plan because i agree that is the way this

is going to have to play out um and then of course there's a follow-on questions how long does that go for How do you create those conditions? I think you're talking about at that point in international force. You share that burden amongst all the allies who are gaining the benefit from it. So everyone should be invested in that. And now I'm coming off of my soapbox. So coming up next, energy markets you may have noticed are on edge as the war with Iran threatens oil flows to the strait of Hormuz. Daniel Turner, he's the executive director of power of the future.

He'll join us to break down the growing energy crisis. So please, stick around. Hey, Mike Baker here, with an important message for every small business out there. Now, small businesses, you probably know this, they face an uphill battle with big banks, right? Where getting a loan means endless paperwork and delays. For bank rates without that weight, go to cardiff.co slash PDB for up to $500,000 in funding. Their application takes less than five minutes, has no impact on personal credit, and approval happens in minutes with same-day funding.

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Welcome back to the PDB Situation Report. Global markets are showing fresh signs of anxiety as the war with Iran enters its second week. Now, oil prices briefly surged to nearly $120 per barrel this week amid fears that the fighting could lead to long-term disruptions to energy flows across the region. Shipping traffic through the Strait of Hormuz has also slowed as insurers and cargo operators reassess the risks, raising new concerns, of course, about when energy supplies will be able to move freely again through one of the world's most important maritime choke points. For more on this, I'm going to turn to Daniel Turner. He's the executive director of Power the Future. Daniel, thank you very much for taking the time here on the PDB situation report.

Thank you for having me. So what should we talk about? Let's see. There's that thing in Iran. Let's start from... Well, actually, I'd love to start from wherever you think. What's the most important thing that people should know right now from your perspective being neck deep in the energy business?

Everyone is jittery. And when oil markets are jittery, they only go up. We don't have a supply problem, right? If I were Europe or even some of the Asian markets are Asian allies, I would be nervous because they do have a supply problem, right? They are dependent on the Middle East for oil and gas. I've seen reports that the UK has only a few days left of natural gas reserves. We don't have that problem.

Yes, we are paying more. I don't want to see high prices. I don't want to see people suffer when they fill up their gas tank. I have a farm in addition to running power of the future. I fill up my tractor. Diesel is through the roof. I don't want to pay it. But we don't have a supply shortage.

We have very nervous markets. and we need come to restore a little bit of order to those markets. Okay, well, how does that happen in the midst of a conflict? What it appears, as if the Iranian regime has no intention of lightening up on the strait of Hormuz. Yeah, and this is where, you know, I'm not a military tactician, so I don't want to speak out of my expertise. But you need 150 or so tankers to get through those straits every single day. and when you are a captain and you have a $250 million cargo or payload,

you're not going to take a gamble. Obviously, you probably can't get the insurance. So there's multiple reasons why you are anchored and you're not budging. If you are oil producing in the Gulf, you're running out of storage. And so you've stopped production only because your storage is, I mean, this is a cycle that has to move constantly and constantly. And something that we experienced during previous blips, we'll just call what the Biden administration did oil and gas blips.

This disruption, you can disrupt really quickly to come back online is hard, right? This is not an industry that activates very quickly. You can shut it down on a second, but every delay is going to delay getting it back online. And that's a little bit of my concern. I've been surprised, I'll tell you the truth. I've been surprised at how, I'll use your word jittery, but how nervous and how risk averse. And I understand what you're saying about, you know, the risks involved. But the industry seemed to put on the brakes even before we started seeing incidents of vessels being targeted in the straight and around the straight.

And it seemed as if they were very quick to say, okay, that's it. And honestly, Iran hasn't closed the straight. I think they've realized that targeting, you know, maybe now at this point, 16 or so vessels and the threats that were put out there before that started to happen, you know, they don't have to do much to create this chokehold. And this is where I think the other partners in the region are going to get heavily involved, right? This is bad for global markets, of course. It's bad for American markets. But if you are the UAE, if you are Qatar or Qatar, if you are Kuwait, it's really bad, right?

Because these petro states, 85, 90 percent of their GDP is oil and gas. They cannot quite literally afford to have markets shut down for longer than this. And a lot of their economies are, you know, their stability is based upon, the high net worth of the oil and gas executives, right? It's why people, when they go to Dubai or they go to Doha and they see this opulence, this garish opulence, it's because oil and gas is flowing. So that's a little bit of comfort I have is that, yes, America is vested in having this resolved, but these countries are really, really vested.

And add on top of that, that Iran has attacked them. So I think you're going to see them start stepping up very, very quickly. Well, I hope you're right because I agree on a number of levels, including sort of a military operational perspective. You know, the Gulf states, look, I think a lot of people may not recall or didn't know that these Gulf states supported Iraq during the Iran-Iraq war, which was a nasty conflict. I don't think Iran's forgotten that when it comes to these. And plus also, obviously, they house a number of them house important U.S. military facilities. So I hope you're right because I think them getting more, I don't want to say in the game in terms of offensive actions against Iran, but they need to exert more pressure. And I think Iran's strategy initially was to do what they're doing, target these states, including civilian infrastructure in places like Kuwait and Bahrain and Saudi, and thinking that they would then pressure the U.S. into stopping this.

But the concern here, again, I've got to go back to what I was alluding to before, is that. is that Iran can't go toe to toe to toe with the U.S. and Israel. They know that militarily, but they have this amazing leverage point. And so the concern is, you know, it's one thing for the White House to declare victory and say, okay, we've wrapped it up. But if the regime doesn't want to, because now they want to extract some concessions before they say, fine, you know, we'll get back to, you know, business as usual, that's going to be a difficult moment in time, particularly if oil prices have got up over $100 a barrel again.

Yeah. And you also see the American military, the president, Secretary Hegsev, they have been reluctant to have this big offensive against Iranian oil and gas infrastructure. And I think that's very deliberate. They know that they want a favorable regime in place. The Iranian people want their peace and prosperity. of the Shaw years of pre-Iatolli years. In order to get that, they need oil and gas revenue. They have a huge oil and gas infrastructure, a very successful one.

So I think when you compare it, for example, what we saw in Venezuela, there was no damage to the facilities because President Trump knows to have a stable Venezuela and a stable South America, they need the petro dollars. They need the industry to thrive. We could end this resolve very quickly if we carpet bombed their oil and gas revenues. but then what are they left with? Then they're left with the failed state, like we saw in Afghanistan, for example, and that will turn to further chaos.

So it's a tango. There's no doubt about it of winning without doing unnecessary damage to help the rebuild process. Yeah, it's a great point that you make because I think it's, I mean, Clark Island, a lot of people I've seen and I've talked to, they say, well, why don't we just bombing Clark Island, which is their major exit point? I think nine out of ten barrels, they push you. out the door goes out of Karg Island. And you're absolutely right.

The reason we don't is because then what are the people of Iran left with? And I think that, correct me if I'm on what? That facility is, what, 65 years old, 70 years old? It was built by Aramco or Amico or some. A lot of time ago. And it's been bombed several, several times. And it's been rebuilt several times. And it got back to full fruition in around 2000.

2009. It's producing around 1.5 million barrels a day or bringing to market 1.5 million barrels a day, but it has the capacity to go to five. So if you're the country of Iran and you look at, you know, God willing, it gets favorable leadership. Five million barrels a day is a lot of revenue to rebuild to stabilize, right? That's what I think the president has to look out long term and say, you know, once military action is done, are we going to have an unstable economy? country and what brings stability is pay some prosperity and bread. Yeah, the ability to generate revenue. I'm very cynical about the idea that we're going to get a better government, right, that the regime

is somehow going to collapse. There's just really no signs yet of any actual fractures within those organizations, the key organizations. But should there be, right, and should there be the opportunity, then you need that revenue stream. That's why Carg Island has been so important. They didn't bomb it during last year's 12-day war, which was interesting, again, to a lot of people, but I think you're absolutely right. That's the reasoning behind it. Daniel, if you'll stay right where you are, don't go anywhere.

And we'll be right back with more from Daniel Turner, executive director of power of the future, also a farmer, apparently we just learned that. That's breaking news on the situation report. We'll be right back. Hey, Mike Baker here. Now, folks who know me know that I may be partial to an ice cold gin martini or two on occasion, usually whenever happy hour rolls around. But the truth is, I don't want to pay for it the next day, and that's why I love Z biotics. Look, it's the first genetically engineered probiotic, created by PhD scientists to help you handle those rough mornings after drinking, and nobody knows rough mornings after drinking like PhD scientists. Here's the deal. When you

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Pepsi prebiotic cola in original and cherry vanilla. That Pepsi taste you love with no artificial sweeteners and three grams of prebiotic fiber. Pepsi Prebiotic Cola. Unbelievably Pepsi. Welcome back to the PDB Situation Report. joining us once again is Daniel Turner he's the executive director of power the future Daniel thank you for sticking around appreciate it very much you mentioned briefly I just want to kind of take a quick left turn but you mentioned gas as well LNG that gets lost in the

wash air a lot because people just imagine we're just talking about barrels of oil but that straight is very important right to Europe and to and to China to Asia for LNG purposes oh it is it's absolutely critical and especially as you see huge development in Asia they need LNG desperately. It explains why this $40 billion Alaska pipeline that's being built for natural gas is funded almost exclusively by Japan by South Korea. It's a great strategic step of the administration to lure them our direction rather than have them get natural gas from the Qataris or from the United Arab Emirates, etc. But yeah, these are huge petrochemical hotspots. And it emphasizes the world runs on this, right?

And that's what I do with Power of the Future is advocating for these American energy jobs. We can wish it were another way, right? We can hope that the world ran on wind or solar, but it doesn't. It may one day, but right now we live in a deeply fossil fuel intense lifestyle. And those people who control the fossil fuels can set the tone for the world. and I think President Trumpstein trying to do it with American hegemony as the guiding principle. Yeah, yeah. Well, if the world could emulate Washington, D.C., which by all accounts, seems to run on hot air.

See what I did there. That's like a dad joke right there. So is it true that, look, there is oil moving through the strait, right? Iran is kicking oil out the door, but is it true that it's almost all going to China? I've heard mixed reviews. I've heard that everyone is turning off their transponders and ships are getting out, but they're not being tracked. I've heard it's only Chinese ships. I don't know.

The fact that I don't know, and again, I'm not someone super powerful or influential, but if I don't know, and I'm pretty good at this, that means a lot of people don't know. And that explains the jitters of the oil and gas market, right? They just don't understand what's happening. And when they're nervous, they begin to panic and panic means higher prices. When you look at what happened, for example, a couple, God, it seems like it was a decade ago, but the operation in Venezuela was not very long ago. There was no movement in oiling gas markets because it was clear, it was simple. No one was concerned and no one panicked.

Right now, there's a lot of uncertainty and oil markets hate uncertainty. What about that's a guy? I'm really glad you brought up Venezuela, right? Because to what degree, I mean, talk to us in sort of, you know, without getting too far into the weeds, you know, what was the state of Venezuela's oil industry at what capacity was it operating when Maduro was picked up? And what's its ability in relatively short terms to make up for some of the shortfall? I realize what you're saying, there's not a supply problem, but there is if you can't move it. There is. Yeah, I like to say Venezuela was using dial-up modems in the sense that, you know, they had the internet. It was just slow and it wasn't really caught up. It is a lot quicker to inject new technologies and new equipment into existing wells and produce more than it is to drill from scratch. So Venezuela was producing, I think, just under a million barrels a day. They have the potential to hit five or six million barrels a day. They have the world. largest oil reserves that are yet known. I think America probably would have more,

but there's a lot of America we're not allowed to even explore, so we can't answer that question. But of those that have been explored and proven, Venezuela wins. So when you invite the American oil and gas industry and say, hey, look, we'll give you security, we'll give you stability, you'll recuperate all of your losses. Do you want to invest? They're going to say yes, because there's this huge pool of oil that they want to play in. I think, I think it makes sense that they went to Venezuela before the Iran engagement because they realize this is 80 some odd million barrels injected into the world's oil supply. That's really important leverage because they knew this was going to have huge oil and gas

disruption. They're not naive. But is there a short-term run-up to that, to them getting to a significant capacity? I mean, is there this rebuilding, this modernization of their infrastructure? infrastructure work. Yeah. But we now work. This is a short-term resolution. Yeah. And I think that that build-up is months, not, not years, right? I think it's relatively quick with how quick this industry works. Again, this industry is super advanced and agile. What it usually just needs is cooperation from the government to do its darn job. We saw that, for example, with oil prices, just the beginning of the Trump

administration. Right. There was no new technology. There was, was no new discovery, but oil went from the average of $90 a barrel to $62 a barrel within a matter of weeks. And that was just because of the stability that was brought by getting rid of the uncertainty, getting rid of regulatory financial market uncertainty, permitting uncertainty. You can get a lot of oil and gas out of the ground if you have cooperation from government. What do you hear about, I mean, sticking with Venezuela for just a minute, but is it a fairly active environment right now in terms of the oil majors, you know, popping in and saying, okay, let's see what, what have we got here as opportunity?

Absolutely. There was that really interesting roundtable that the president had with the largest oil and gas producers in the nation, I think around 20 of them around the table. One or two said that they were unsure, but the rest all said like, yeah, we'll jump into this. And that's kind of indicative of the industry as a whole. It's why that show, you know, a land. man is so like there there is a bravado of the oil man kind of like that like the marine right or the or the CIA operative right there's a sense of like oh yeah this is what we do and that excitement and that

that energy is is what what encourages them to go to a place like Venezuela and say way do you way do I show you what I can do when I get here if you can tap into that boy you can do great things in this country yeah I like how you you threw the Marines and the CIA all there together yeah Altogether. All bravado. But you're right. I mean, it's not quite the way people think it is from the movies and the beach books. But yeah, sure, the agency certainly has a risk appetite.

Yeah. You know, and it's not like we're sitting around saying, let's wrap up the Iran shenanigans so we can get busy with Cuba. But there, you know, you're always kind of forward-looking and thinking about what's going to impact. What? I don't want to disappear down that. Rabbit Hall. What is the, this is going to sound like a strange question, but the pricing for oil.

We've seen these wild swings, right, in the past few days. But what is, from the industry's perspective, right? If they were completely honest, what's the sweet spot for a price, for a barrel of oil? $72. The reason why I'm throwing like a, I mean, like, I, I, very specific. Yeah. Oh, yeah. I mean, I'm trying to be some, they have to make enough money so that they can have a profit,

so that they can put that profit into further exploration, right? Like, acquiring land and beginning to drill for oil is a $60 million venture, right? I mean, and you haven't produced a drop of oil yet, and you are $60 million in the whole. So they need to make enough money on daily oil sales to recuperate loss and to go into the future. But they know they can't make so much money that they're going to have Congress up their rear end. They're going to get hold before Senate hearings. people are going to start protesting, throwing bricks through their windows. So they know that the days of $140 barrel of oil are not sustainable.

Will they ride that train for a little while? Absolutely. You saw that in the Biden years, though, they weren't able to reinvest. There was no permitting. There was no access. So what did they do? They bought back their stock. They gave themselves bonuses.

And they got yelled at by Congress. How dare you make money? What else am I supposed to do with the money? I have to do something with it. I'm not going to declare it on my taxes, right? So, I mean, sweet thought of making enough. 26 model year.

Sorry, the 2026 model year for the Porsche is coming out. What am I supposed to deal with my funds? So, 72 is the sweet spot. 72 is a, okay, that's, that's Daniel Turner. I think, I think, well, I mean, would Putin argue that, you know, something over 100 is the sweet spot? Of course he wouldn't.

He's going to try to get it to that level. but but American energy production will prevent him from doing that right the Saudis wanted at that level as well they tried to do that in the first Trump administration and we just outproduced them opaque kept slashing production we just outproduced them and the price never got to that right and you have to see that they their margins are obviously much greater than ours because they don't have an OSHA they don't have sexual harassment and diversity Fridays they don't have to you know they They can employ 14-year-old kids and not pay them social security and health care. So they would love to have $150, $120 barrel of oil.

And then we have naive Americans who go to these places, countries that I've had to spend a lot of time in that I don't like. And they say, wow, look how glitzy and glamorous and world's tallest building, world's fanciest. How do you think it's built? It's built on slave labor from an industry that America used to dominate. and I want to dominate it again for good. Yeah.

Yeah. No, again, self-sufficiency is the key. Is there anything, being mindful of your time, we'll have to wrap, but is there anything that realistically, the industry, the energy industry, can do about the current situation, about the, let's go back to the word jitters, about the nervousness, about the price swings, or is it basically we have to stand by and wait and see what the Iranian regime does? There's nothing the industry itself can do. They are producing as much as they possibly can.

And at this price point, they're going to try to produce even more. But again, it's not like a spiket that you can just turn on the taps, right? You can't increase oil production from the wells you already have drilled. You can try to drill more wells, but that's four or five years in the process. So there's nothing they can do. This is global markets at work, and President Trump's accepted that, and he thinks it's for a greater cause.

And I hope he's right. I believe he is. Yeah. Yeah. No, I do think that there was a real reason to go in, but I'm not sure that there was this thinking at the end of the day that said, well, maybe we do declare victory, but maybe that doesn't mean anything,

because maybe the regime has decided that, you know, again, they'll continue to exert pressure in this one area, the one area that they can go toe to toe with the international community, meaning the straight of Hormuz, and extract every concession they possibly can before they're willing to stop their shenanigans. Daniel, this has been a great conversation. At least I think it's been a great conversation.

So thank you very much, man. I really appreciate you being here. Daniel Turner, Executive Director of Power the Future. I hope you'll pick up the phone next time we call you, man. Anytime. Thank you for having me on. All right. Well, that is all the time we have for the PDB situation report. Now, look, if you have any questions or comments or anecdotes or limericks,

look, all I got to do is reach out to me at pdb at thefirsttv.com. You know what we do with your comments and your questions, right? We all gather around the table once a month, including the interns. It's a pretty good team of interns. and we select your best questions, comments. We kind of mush them together. That's a technical term in production. And we create what we call a monthly Ask Me Anything episode, right?

Well, within reason, let's do that. So I guess the point being, keep your cards and letters coming, all right? To listen to the podcast of this show ad free, you can do that, and it's very simple. Just become a premium member of the president's daily brief by visiting bdbpremium.com. I'm Mike Baker. And until next time, you know the drill. Stay informed. Say safe. Stay cool. How many discounts does USAA auto insurance offer? Too many to say here.

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