The Strait of Hormuz was operational until Trump unilaterally launched U.S. military action against Iran to predictably close it. Why would America close the strait? I find many people still scratching their head, especially after Trump announced he would keep the strait blockaded if Iran tried to open it. He clearly doesn’t want it to be open, even as oil prices go higher and higher.

Oil prices directly hit American pocketbooks. But they also are being raised by a military disruption that costs taxpayers billions every day. This post takes a look at some causal relationships for all this cost landing on Americans, and how it appears to be a get-rich-quick scam by the Trump family.

The closure is the third such event in the modern history of the chokepoint. The first was the Tanker War of 1984 to 1988, in which Iraq and Iran attacked one another’s shipping and the United States reflagged Kuwaiti vessels under Operation Earnest Will. The second was the tanker attacks and seizures of 2019, including the limpet mine attacks in the Gulf of Oman and the seizure of the Stena Impero. The current closure is the longest, the most kinetic, and the first in which the strait has been mined as policy rather than as harassment. The actors are thus very familiar, while the new arrangement is not.

As everyone with a clue predicted, Iran executed its asymmetric strategy designed across four decades for exactly this moment. Mining the strait, attacking the Fujairah pipeline terminal, and striking shipping at the Hormuz approaches are all historic doctrine the Islamic Revolutionary Guard Corps has rehearsed since the Tanker War. The strait is the one instrument over which Tehran telegraphed their escalation dominance, and it is being used as designed.

The American response, branded Project Freedom, is a deployment of 100 aircraft and 15,000 personnel that the Pentagon says is not an escort mission. Earnest Will, in 1987, was an escort mission. Project Freedom however is the language of liberation attached to a permitting plan. The forces deployed are being called sufficient only for a traffic toll booth, declared insufficient to clear it and return to normal.

Venezuela puts all of this in proper context. The third actor in the arrangement is the one usually absent from press accounts of the Hormuz crisis. Maduro was captured on January 3, at great cost to the U.S. taxpayer, and Venezuelan hydrocarbon production was forcibly passed to U.S. operational control in the same week. Venezuelan crude is heavy, sour, and capital-intensive, meaning the economics all relate to high Brent prices and not the low ones. It goes something like this:

Price delta from the closure
Brent before the war	$72
Brent today	$114
Premium per barrel	$42
Windfall at current Venezuelan output (350,000 bbl/day)
Per day	$14.7 million
Per year	$5.4 billion
Windfall at 2018 peak output (1.2 million bbl/day)
Per day	$50 million
Per year	$18 billion

The table lays out the operating subsidy for Venezuelan production, paid by every oil consumer. It appears at the pump in Iowa that Trump keeps talking about. But it also is in the diesel cost of a Bavarian trucking firm, and in the invoice of a Singapore shipping line, let alone all the manufacturing that depends on oil. Trump interference in Hormuz is driving the numbers up, in a way reminiscent of tin-pot dictatorships squeezing their populations before making a run for exile.

Marcos stripped the Philippine treasury and flew to Hawaii. Mobutu looted Zaire and died in Morocco. Ben Ali, Duvalier, all did the same play of extract while in office, exit as it fell apart. Manafort’s work with Somalia’s Barre, before advising Trump, is surely no coincidence. And that’s not to mention Manafort’s clients also were Mobutu, Marcos and Jonas Savimbi of Angola.

The Trump family is deep into Saudi LIV money and UAE real estate, making a $2 billion Affinity Partners deal via Kushner. Trump projects run in multiple Gulf jurisdictions, along with crypto holdings to escape American oversight. Trump is personally controlling Venezuelan oil proceeds through an offshore account in Qatar, with $250 million already awarded to Vitol whose senior trader gave $6 million to the 2024 campaign, and Paul Singer positioned to convert Venezuelan crude into refined product through distressed U.S. assets he is acquiring. It’s yet another pipe into the Trump extraction architecture.

As long as Brent stays above the threshold at which Venezuelan crude clears, the closure looks more and more like a very cynical Trump family business plan to pump, destroy and run.

Looking at how the other Manafort clients ended up, if Trump abruptly fled to Russia, Saudi Arabia or the United Arab Emirates, none of them would extradite him.

Speaking of the Gulf monarchies, they occupy a fourth position. Saudi Arabia, the United Arab Emirates, and Kuwait need the strait to export their approximately seventeen million barrels a day. With the Fujairah strike they lost their principal alternative. OPEC’s announced production increase, of several hundred thousand barrels a day, contrasts against a wartime loss estimated at approximately fourteen million barrels a day. Riyadh and Abu Dhabi have thus become consumers of a security framework they do not control, from an angry “sitting duck” President they can’t depend upon.

European and Asian importers typically have been absent from the strategic conversation, yet they also fit. Japan, South Korea, India, and the European Union receive the price signals and pay it. The South Korean-linked vessel that exploded at the strait on Monday is one example. Nations declaring energy crisis and immediate pivot to other forms of energy is another. Denmark this month paused new grid connections after capacity requests reached 60 GW against a peak demand of 7 GW, with data centers accounting for nearly a quarter of that. The Danish framed a pause as their window to rewrite how large electricity consumers can abruptly demand supply.

Kpler reports 170 million barrels of crude and refined product trapped on 166 tankers in the Gulf, against roughly 900 million barrels sidelined since the war began. Kpler also tells us it could take at least three months to clear the strait once it reopens. The duration of the closure, the rate at which it is relieved, and the sequence in which tankers depart are now functions of U.S. permitting decisions rather than maritime conditions.

Treasury Secretary Bessent stated on Monday that the world will be awash in Trump oil on the other side of the Trump closure. If we look at history, the Tanker War ended when Iran accepted UN Resolution 598 after the destruction of much of the Iranian navy in Operation Praying Mantis and the shootdown of Iran Air 655. America strategically forced that conclusion. Earnest Will ended when reflagged tankers no longer were needed. The present closure has no comparable analysis, because resolution doesn’t actually seem related to the dispute between Iran and Trump. Instead, closure appears more and more to be a cynical Trump gambit to corner the supplies for a price at which a separate set of investments, in a separate hemisphere, becomes profitable to him.

On that math the strait will reopen when an artificially high Venezuela price no longer needs to be defended.

Just a theory. But if the dictator shoe fits…

Thomas Friedman calls Craig Mundie his “technology tutor.” He’s said it publicly, repeatedly, for over a decade. Perhaps it’s meant to sound endearing. It’s actually a sad confession. The most influential foreign affairs columnist in America openly outsources his entire understanding of technology to a single person. Why?

That person’s track record deserves closer examination within context of a larger institutional failure rated as success.

Microsoft Failure Man

In 1982, Mundie co-founded Alliant Computer Systems, a maker of vector-parallel mini-supercomputers. He became CEO. The company filed for bankruptcy June 5, 1992 because they didn’t see the PC coming.

He joined Microsoft that same year to run the Consumer Platforms Division. Here is what he built and championed:

Year	Product / Initiative	Outcome
1992	Windows CE	Dead
1990s	Pocket PC	Dead
1990s	Auto PC	Dead
1997	WebTV Networks ($425M acquisition)	Dead
1990s	Interactive television	Dead
2000s	Digital rights management strategy	Dead

When Bill Gates stepped back from daily operations in 2006, Mundie and Ray Ozzie were appointed to fill his visionary role. Mundie became Chief Research and Strategy Officer. During his tenure in that position, Google beat Microsoft to self-driving cars. Apple beat Microsoft to voice recognition with Siri. Microsoft missed mobile. Missed search. Missed social. Missed cloud computing until Satya Nadella arrived and reoriented the entire company away from the strategy Mundie had been overseeing.

To be fair, Ballmer overruled strategy recommendations, and search and social blinders may have been other divisions’ calls. But show me the wins. By late 2012, Mundie was moved to “Senior Advisor to the CEO,” the corporate equivalent of a quiet pasture upstate where his opinions wouldn’t be heard anymore. He retired in 2014.

Selling Invisible Pants to Elites

What happens to a technology executive whose products all failed but whose rolodex thrived? He becomes a bogus sage. Mundie landed on the National Security Telecommunications Advisory Committee under three presidents. Obama’s PCAST council. The Bilderberg Group steering committee, which he attended every year from 2003 to 2019 except one. The World Economic Forum. And then the capstone: co-authoring Genesis with Henry Kissinger and Eric Schmidt, a book about AI published in November 2024.

Kissinger.

The architect of the secret bombing of Cambodia. The man who backed the coup in Chile and the Indonesian invasion of East Timor. Who enabled the Pakistani genocide in Bangladesh. Who treated civilian populations as abstractions to be managed through force. This is who Mundie chose as his co-author on the governance of a technology that will reshape civilian life everywhere.

That tone-deaf choice tells you everything about the Mundie gambit: power managed by the powerful, consequences borne by everyone else. Talk down and ignore reality.

The technology product arc of disasters was foreshadowing. Build things that fail. Accumulate institutional access along the way. Pivot from practitioner to advisor once the failure pattern becomes undeniable. The access persists because Davos doesn’t audit skills like product launches. It rewards gravitas in presence.

The Column

This week Friedman published a column about Anthropic’s Claude Mythos announcement. His source for interpreting its significance was, naturally, Craig Mundie. The column treats Mundie’s analysis as authoritative. It contains Mundie’s three-step framework for responding to the threat. It quotes Mundie at length. It cites no other technical source.

Friedman writes:

[Mundie is] a former director of research and strategy at Microsoft, a member of President Barack Obama’s President’s Council of Advisors on Science and Technology and an author, with Henry Kissinger and Eric Schmidt, of a book on A.I. called Genesis.

Every word of that sentence is true. Every word of it is also designed to obscure the fact that Mundie’s actual technology career was a sequence of expensive bets that all lost.

The credential list substitutes for any actual performance record.

The Friedman column is similarly bad at placing bets. It describes AI-powered vulnerability discovery as if no one had ever heard of fuzzing, static analysis, or red team operations.

OMFG.

He illustrates the threat with a scenario where children accidentally take down a power grid. This is the Computer Fraud and Abuse Act (CFAA) debate of 1984, recycled. Congress passed it in 1986 after WarGames convinced legislators that teenagers with modems could launch nuclear weapons. Before that, Captain Crunch and the phone phreakers were going to launch nukes, shut down power or destroy the telephone system.

Did he just wake up from 1986?

By early 1999 I personally had reported clear text authentication on the American bulk power grid in five states. Thousands of routers vulnerable to trivial destruction. Did I break anything? The old geezer in a suit panicking that “kids will break everything” has been the go-to move for people who want to centralize control of new technology for forty years. Friedman presents it as an original insight, as if nobody remembers the 414s.

He proposes US-China cooperation on AI governance in the same week the US is actively restricting chip exports to China to prevent exactly the AI capability development he’s now asking them to collaborate on. He doesn’t notice this dumb contradiction because he’s transcribing, not analyzing. He would do far better to trust AI than the hallucinations of Mundie.

Meatspace

A columnist who calls someone his “tutor” on a subject is telling you he cannot independently evaluate what that person says. Friedman admits no second opinion on technology, and he lacks the technical literacy to know what questions would surface one. Mundie tells him this is unprecedented. Friedman writes that it’s unprecedented. Mundie says it requires US-China cooperation. Friedman writes that it requires US-China cooperation.

This is how a man who got WebTV, Windows CE, the Pocket PC, interactive television, and digital rights management wrong becomes the person explaining artificial intelligence threats to New York Times readers.

The technology tutor model has an obvious flaw. The student can’t evaluate the false tutor, because the student can’t evaluate the subject. He can only evaluate the tutor’s confidence, which is deeply ironic. Just like the real danger with a bad AI chatbot, confidence is the one thing Craig Mundie has never lacked.

The threat of AI is the relationship Friedman has with Mundie, not the AI.