Saudi Arabia, UAE, Kuwait, and Qatar discuss canceling US investment commitments.
Financial Times
Financial Times (paywall): Gulf states could review overseas investments to ease financial strains caused by Iran war
Not the end of the US empire, but the Mideast producers are not happy being dragged into a Trump and Israel sponsored war.
Reuters: Gulf states could review investments due to financial strains caused by Iran war, FT reports
Gulf states could start to review their overseas investments and future commitments as they consider options to ease the pressure on their budgets following the U.S.-Israeli attacks on Iran, the Financial Times reported on Thursday.
A Gulf official told the newspaper the conflict that has engulfed the region could have an effect on anything from investment pledges to foreign states or companies, sports sponsorships, contracts with businesses and investors, or sales of holdings, especially if the war and related expenses continue at the same pace.
Reuters could not immediately verify the report. FT did not disclose the name or the position of the official.
For decades, the Gulf’s rise rested on two core assumptions: that its rapidly growing cities offered safe haven in an unstable region and that vast wealth from uninterrupted energy exports would keep flowing. Recent events have shaken both pillars at once.
“A number of Gulf countries have begun an internal review to determine whether force majeure clauses can be invoked in current contracts, while also reviewing current and future investment commitments in order to alleviate some of the anticipated economic strain from the current war,” a Gulf official told FT.
Bahrain Plans to Withdraw from US Bilateral Treaty
Force Majeure South Korea
Force Majeure Poland
Can Trump Really Defend All Tankers in the Persian Gulf?
The Wall Street Journal asks Can Trump Really Defend All Tankers in the Persian Gulf?
The U.S. lacks Navy ships nearby to keep oil flowing through the vital waterway, experts say
Zero Attempts
Russia Benefits
Pentagon Races to Secure Money for Iran Operations, Munitions
The Wall Street Journal reports Pentagon Races to Secure Money for Iran Operations, Munitions
Pentagon officials are drawing up plans to replenish U.S. munitions expended fighting Iran over the past week, according to people familiar with the matter, a step in the Trump administration’s efforts to sharply increase the number of missiles manufactured each year.
Lawmakers in Congress and defense industry officials are expecting a funding request from the Pentagon to pay for costs associated with the war. The new funding would support the purchase of Patriot, Tomahawk and Thaad missile systems, which have been in heavy use since the U.S. and Israel began their strikes, the people said.
Recent fighting in the Middle East has burned through stockpiles for some of those weapons. That has added a new challenge for the Defense Department, which is wrestling with how to pay for a war with an indefinite end date. It also is facing an industrial base that was already stretched to meet current demand and potential threats from China.
As Fast As We Can
Trump administration officials have spent months pressuring big defense contractors like Lockheed Martin and RTX to triple or quadruple their annual production of their most advanced missiles.
The Pentagon launched an effort last year to accelerate production of missiles and other equipment to boost thin domestic stockpiles. Officials in June summoned more than a dozen top weapons makers to urge them to invest early in production increases. Steve Feinberg, the deputy defense secretary, has held weekly calls with some company chief executives for several months to drive the point home.
Company executives have responded with new investments but warned that production isn’t as simple as building more factories. The asked-for production boosts depend on smaller contractors deeper within the supply chain.
“We’ve been working this problem set on munitions supply long before this conflict,” Michael Duffey, the Pentagon’s top official for procuring missiles and other weapons, said in a House committee hearing Wednesday. “Knowledge of our supply wouldn’t make me go faster. We’re going as fast as we possibly can.”
The White House summoned top defense-industry executives from companies including Boeing, Lockheed Martin and RTX to a meeting on Friday, said people familiar with the plans.
Ah Yes, the Supply Chain
Q: What have Trump’s tariffs done to that?
A: China responded by cutting its exports of rare earth minerals needed for smart phones, magnets, and military equipment.
China’s New Rare Earth and Magnet Restrictions Threaten U.S. Defense Supply Chains
The Center for Strategic and International Studies reports China’s New Rare Earth and Magnet Restrictions Threaten U.S. Defense Supply Chains
Q2: What do the new restrictions mean for the defense and semiconductor industries?
A2: Rare earths are crucial for various defense technologies, including F-35 fighter jets, Virginia- and Columbia-class submarines, Tomahawk missiles, radar systems, Predator unmanned aerial vehicles, and the Joint Direct Attack Munition series of smart bombs. The United States is already struggling to keep pace in the production of these systems. Meanwhile, China is rapidly scaling up its munitions manufacturing capacity and acquiring advanced weapons platforms and equipment at a rate estimated to be five to six times faster than that of the United States.
The newly announced restrictions represent China’s most consequential measures to date targeting the defense sector. Under the new rules, starting December 1, 2025, companies with any affiliation to foreign militaries—including those of the United States—will be largely denied export licenses.
Trump on Truth Social “Unlimited Supply of Weapons“
Truth Social: The United States Munitions Stockpiles have, at the medium and upper medium grade, never been higher or better – As was stated to me today, we have a virtually unlimited supply of these weapons. Wars can be fought “forever,” and very successfully, using just these supplies (which are better than other countries finest arms!). At the highest end, we have a good supply, but are not where we want to be. Much additional high grade weaponry is stored for us in outlying countries. Sleepy Joe Biden spent all of his time, and our Country’s money, GIVING everything to P.T. Barnum (Zelenskyy!) of Ukraine – Hundreds of Billions of Dollars worth – And, while he gave so much of the super high end away (FREE!), he didn’t bother to replace it. Fortunately, I rebuilt the military in my first term, and continue to do so. The United States is stocked, and ready to WIN, BIG!!! Thank you for your attention to this matter. President DONALD J. TRUMP
“The U.S. military has more than enough munitions, ammo, and weapons stockpiles to achieve the goals of Operation Epic Fury laid out by President Trump—and beyond,” White House press secretary Karoline Leavitt said in a statement.
Question of the Day
Q: If we have an unlimited supply, why is Trump summoning Boeing, Lockheed Martin and RTX to a meeting on Friday?
A: In TrumpWordTM it’s possible to have more weapons than we need and still need more.
Q: How much will this cost?
A: At least another $500 billion
In January, Trump pledged the next defense budget would reach $1.5 trillion, a roughly $500 billion increase from current levels.
Q: How long will the war last?
A: It was supposed to be over in a few days. Hegseth is now discussing 8 weeks, but who knows? That could be purposely high to enable bragging if it only takes 6 weeks. Then again perhaps it takes 6 months.
Q: What about troops on the ground?
A: Hegseth says that’s possible. However, Trump is betting on the Kurds.
Q: How likely can the Kurds overthrow the Iranian governement.
A: Roughly 0.00 percent. The Kurds issued a statement “After what happened to us in Syria, we refuse to be used as pawns by global powers again.”
Q: So things are going spectacularly well?
A: Yes, for Russia and those who invested for perpetual war.
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OK, how is this supposed to work?
[Also see the official Kurdish response]
Article posted with permission from Mish Shedlock
