The Mad King, For Those Who Did Not Watch The Show
Game of Thrones. The Mad King is Aerys Targaryen, ruler of Westeros, who in his final moments facing certain defeat gave one order: burn it all. Wildfire caches beneath the city. Let me rule the ashes or rule nothing.
The phrase entered the vocabulary as shorthand for a specific decision logic. If I cannot have it on my terms, I will destroy it before anyone else gets it. It is not madness in the clinical sense. It is a coherent negotiating position taken to its terminal extreme. The threat only works if people believe you would actually do it.
Trump is not Aerys. But he is running the same logic on the energy infrastructure of the Middle East, and unlike Aerys, he has the Air Force to back it up.
Prediction Tracker
A note before the table. This section exists because some readers expressed discomfort when the original predictions began landing too quickly. The feedback, charitably paraphrased, was that nobody wants to see geopolitical suffering turned into a scorecard. I understand the sentiment. I disagree with the conclusion. Models that are never tested are not models. They are just prose. The scorecard stays.
| Prediction | Made | Status | Notes |
|---|---|---|---|
| US objective is energy revenue control, not regime change | This post | Pending | The thesis of this piece |
| Hormuz reopens within 60 days of Feb 28 | Week 1 | On track | April 6 deadline, deal language getting specific |
| Iran accepts post-war revenue oversight framework | This post | Pending | New Supreme Leader as wild card |
| Redollarization accelerates as Axis fractures | Week 1 | Confirmed | Dedollarization narrative structurally broken |
| US GDP pulls away from China through 2027 | Week 1 | On track | Gulf energy costs a direct headwind for Chinese manufacturing |
| 2026 as Axis of Resistance high-water mark | Week 1 | On track | Proxy network operationally hollow |
| New Middle East, no Iranian veto | Week 1 | On track | Proxy degradation data holds |
| Four-week resolution as modal scenario | Week 1 | Wrong | Off the table. Underpriced a new Supreme Leader's need to not open with surrender |
The one miss is the timeline. The thesis is intact. I underpriced the structural reality that a new ruler cannot open with capitulation. That is not a political observation. That is physics.
The Play
Stop trying to understand what is happening in the Gulf through the lens of democracy promotion, nuclear non-proliferation, or the rules-based international order. That is all set dressing.
The United States is running a global energy control play. The offer on the table, in every theatre, is the same one. Let us sit between you and your oil revenues, or we remove your ability to have oil revenues at all. There is no third option. There has not been one for a while. We just stopped pretending recently.
Iraq. The Template.
Since 2003, Iraq's oil cheques have gone to an account in New York. Not a metaphor. Literally. The oil money of a sovereign OPEC nation lands at the Federal Reserve Bank of New York before Baghdad sees a cent. When Iraq formally asked American troops to leave in 2020, Washington picked up the phone and explained what would happen to that account. Baghdad reconsidered.
Oil is ninety percent of the Iraqi state budget. Salaries, schools, hospitals, all of it. You want to pay your teachers this month? You need Washington's goodwill. That is not leverage. That is a leash with a very polite name.
And now, quietly, while everyone watches the airstrikes, the same script is running on repeat. Sanction the current owner into the ground. Watch the asset become distressed. Watch a Washington-connected firm appear at the door with a cheque. Watch the Treasury approve the paperwork. Watch the flag change. Funny how that works, every single time, in every single country.
Venezuela. The Template, Accelerated.
Maduro captured. Transferred to New York. On trial.
Venezuelan oil now moves through US-controlled accounts. The ships were seized. The proceeds go where Washington directs. The head of state is in a Manhattan courtroom.
Iraq took twenty years to build. Venezuela took months. The administration learned from the long version. You do not need a generation of nation-building. You just need to control where the money lands.
Iran. The Play In Motion.
Now look at the Gulf. Week five.
The administration is openly discussing seizing Kharg Island, through which ninety percent of Iran's crude exports flow. Trump has threatened to obliterate the oil infrastructure entirely if the Strait does not reopen. The deadline sits at April 6. At the same time, Trump posted this week that the US is in serious discussions with what he called a new and more reasonable regime.
That phrase is doing a lot of work. It means Washington has identified someone on the Iranian side willing to talk terms. The offer is already on the table. The whole question now is whether the new Supreme Leader can find a way to accept it without calling it what it is.
The offer is the same one Baghdad got. The same one Caracas got. Let us sit between you and your revenues. In return, the bombs stop, the sanctions lift, the oil flows, and your people can eat. The alternative is Kharg burning and the Strait forced open by the US Navy anyway, except now you also have no infrastructure left to negotiate with.
Iraq said yes eventually. Venezuela said yes from a Manhattan jail. The question for Iran is only when.
The Plaza Accord Where The Other Party Is Not In The Room
In 1985, the US corralled France, Germany, Japan and the UK into a hotel in New York and negotiated a coordinated dollar devaluation. It worked because all five parties wanted a version of the deal and all five were in the room.
What is being constructed now is a Plaza Accord where the most important counterparty, China, has not been invited and is not expected to show up. The US is not negotiating with the major dollar holder. It is negotiating with the oil producers. Control the spigot, control the price, control who gets energy and on what terms, and you have done a trade rebalancing without Beijing ever needing to sign anything. You do not need China in the room if you are holding the tap that feeds Chinese factories.
The Iran campaign is not separate from the broader economic play. It is the same play on a different board. Squeeze China on trade from one direction and squeeze the energy supply that runs Chinese manufacturing from the other. The 1985 version required cooperation. This version requires nothing from China at all, because the coercion is structural rather than negotiated. That is a more dangerous design. Cooperative parties can signal when something is going wrong. Structural coercion has no such feedback mechanism.
The Noise Is The Tool
One more thing before the numbers. All the oscillation, the 48-hour ultimatums, the deadline extensions, the Truth Social posts swinging between great progress and I will obliterate everything within the same news cycle, none of it is erratic. It is active commodity price management.
Blow up Kharg in one post and Brent goes to $150 and you have a domestic inflation crisis before the midterms. Walk it back and Brent settles. Extend the deadline and the market breathes. The noise is a throttle. Trump is simultaneously running a military campaign, a negotiation, and a commodity price desk, and the ambiguity is doing the work on all three fronts at once.
The selective access for Chinese ships through Hormuz fits the same logic. It looks like a concession to Beijing. It is price suppression. Letting some supply move keeps the global price from going fully vertical while the broader squeeze holds. And China is getting the oil on American sufferance, which means Washington is deciding whether China gets the oil. That is not a concession. That is the same leash, just a longer one, on a larger dog.
Probability Tracker
Week 5. Previous week in brackets.
| Scenario | Probability | Move |
|---|---|---|
| Negotiated deal, Hormuz reopens, Iran accepts revenue oversight framework | 45% | +15 from 30% |
| Extended conflict, partial normalisation, no clean end state | 30% | unchanged |
| Kharg oil infrastructure destroyed, Hormuz forced open by US Navy | 15% | -10 from 25% |
| Full Kharg seizure, ground operation, US forces on Iranian soil | 7% | -3 from 10% |
| Catastrophic escalation, regional war, third-party entry | 3% | -2 from 5% |
What moved the numbers: deal language has gotten specific in a way that vague posturing does not. The April 6 extension rather than a strike order reads as a side that wants the exit ramp. Kharg infrastructure intact is a chip to trade. Kharg burning is a long reconstruction problem that makes the post-war revenue deal much harder to structure. Both sides appear to understand this.
