Extensive damage to U.S. assets. Much more extensive than publicly admitted.
(The Washington Post, Evan Hill, Jarrett Ley, Alex Horton, Tara Copp and Dan Lamothe, May 7, 2026)
Iranian forces have damaged or destroyed at least 228 U.S. military structures and equipment in the Middle East since the start of the war, hitting hangars, barracks, fuel depots, aircraft, radars, communication systems, and air defense at at least 15 bases, a destruction toll far exceeding what the Pentagon and media have publicly acknowledged so far.
Iranian satellite images, verified by the Post by comparing them with Copernicus and Planet data, show targeted and precise attacks on “soft” targets such as housing, gyms, and mess halls, as well as strategic sites like the Fifth Fleet headquarters in Bahrain, bases in Kuwait, Qatar, Saudi Arabia, the Emirates, and Jordan, with seven deaths and over 400 injuries among American military personnel.
The analysis highlights serious deficiencies in U.S. defenses, which have not sufficiently adapted to drone and modern missile warfare, underestimated Iranian resilience and strike precision, leaving some bases vulnerable despite intensive use of Patriot and THAAD interceptors, with consequences now forcing a rethink of the military posture in the region.
Targeted attacks on sensitive infrastructure
“Satellite images show that Iranian attacks damaged or destroyed what appear to be numerous barracks, hangars, or warehouses at more than half of the U.S. bases examined. […] The Iranians deliberately targeted housing buildings at multiple sites intending to cause mass casualties.”
Damage far exceeding declared amounts
“Iranian air attacks have damaged or destroyed at least 228 structures or pieces of equipment at U.S. military sites in the Middle East since the start of the war, a level of destruction much greater than publicly acknowledged by the U.S. government.”
Vulnerability of American bases
“Experts who reviewed the Post’s analysis said the damage suggests the U.S. military underestimated Iranian targeting capabilities, did not sufficiently adapt to modern drone warfare, and left some bases insufficiently protected.”
Lack of alternatives to oil
“The blockade of the Strait of Hormuz has disrupted liquefied natural gas flows, a key input for nitrogen fertilizers like urea. The impact on food is at least as great, if not greater, than that on oil, because there are alternative sources of oil. There are not many alternative sources of nitrogen for fertilizer production.”
Long-term consequences
“Some damage may have occurred after U.S. troops had already left the bases, making protection of the facilities less vital. […] Commanders moved most personnel out of Iranian fire range at the start of the war.”
Heard on the Street: will the crisis cause a recession?
(The Wall Street Journal, Spencer Jakab, May 7, 2026)
The International Monetary Fund published its World Economic Outlook three weeks ago, but the baseline scenario is already outdated due to the closure of the Strait of Hormuz, with economists now seriously considering the possibility of a global recession, not necessarily in all countries but in several simultaneously, impacting agricultural commodities, auto production, and semiconductors.
The three Rosenberg Research hypotheses related to the duration of the blockade show that reopening within three weeks would bring global growth to 2.9% instead of the 3.4% forecast, while a blockade until July would reduce it to 2.6%, and a prolonged closure beyond July would bring it down to 2.5% or even 2%, nearing a global recession with consequences for multinational companies and topics like artificial intelligence.
Although the United States is energy independent, it is not immune because the large S&P 500 companies are multinationals, and a contraction in global demand would affect consumption, investment, and corporate profits, while stock markets fluctuate with every sign of hope from the Middle East, making economic forecasts particularly fragile at this stage.
IMF forecasts already outdated
“The International Monetary Fund published its World Economic Outlook three weeks ago. The baseline scenario is already stale. The differences with the now more likely ‘adverse’ or ‘severe’ scenarios are not small.”
Scenarios linked to the duration of the blockade
“The first and mildest assumes reopening of the strait within three weeks. This would still reduce global growth to 2.9% this year from the 3.4% expected before the war. The second scenario, reopening between mid-May and July, would bring it to 2.6%. The third, closure until July or beyond, approaches a global recession with growth at 2.5% or even 2%.”
Impact on commodities and sectors
“Many more commodities are affected compared to the first Gulf War, the Iranian Revolution, or the Arab Oil Embargo. Materials needed for agriculture, auto production, and even booming semiconductors are in shortage.”
Multinationals and AI not immune
“Large S&P 500 companies are mostly multinationals. Even AI, today’s dominant investment theme, is not immune if companies and households worldwide tighten their belts.”
Markets sensitive to hopes
“Stocks have fluctuated on every ray of hope coming from the Middle East, and that makes sense. The longer the Hormuz blockade lasts, the greater the blow to growth.”
Gasoline prices hit “super commuters” hard.
(The Wall Street Journal, Harriet Torry, May 7, 2026)
The rise in gasoline prices, averaging $4.54 per gallon with peaks over $6 in California, is particularly weighing on American super commuters who travel at least 75-100 miles a day to get to work, often after moving farther from cities to seek cheaper housing during the pandemic.
The combination of less work flexibility and high gas prices is changing the habits of thousands of workers, especially in metropolitan areas like Washington, Houston, San Francisco, and Sacramento, where commuters complain of monthly bills doubled compared to the start of the year and growing frustration over the inability to maintain their previous lifestyle.
Economists emphasize that the fuel price increase acts like a regressive tax hitting low-income families hardest, causing them to cut back on groceries, dining out, travel, and durable goods, with effects already visible in consumption data for March and April.
Monthly costs exploded for commuters
“Nicole Smith fills her Jeep’s tank three times a week for her 50-mile round trip. She now spends about $200 more per month than at the start of the year.”
Super commuters increased after the pandemic
“The number of people with driving commutes of 75 miles or more increased by about one-third after the pandemic. Nearly 63% of workers are now fully on-site, compared to just over half at the end of 2021.”
Regressive impact on lower incomes
“Researchers at the New York Federal Reserve found that the spike in fuel costs particularly affected low-income families, pushing them to reduce spending.”
Concrete examples of super commuters
“Ivan Lamptey drives 120 miles round trip five days a week and spends about $1,600 a month on fuel and tolls. Danielle Grossman replaced her SUV with a hybrid but still avoids driving in the city for evening outings because ‘it adds up.’”
Frustration and spending cuts
“Carolyn Staats drives 100 miles round trip four times a week and now spends $260 every two weeks just on gas instead of $150. ‘It hurts. I had to plan the budget better: instead of saving $150 for gas every two weeks, now it’s $260. That extra $110 I could have used for groceries or other bills.’”
As the war drives fuel prices up, Trump’s advisers are worried.
(The Wall Street Journal, Brian Schwartz and Alison Sider, May 7, 2026)
Donald Trump’s advisers are increasingly concerned about the political impact of record gasoline and jet fuel prices caused by the war in Iran and the blockade of the Strait of Hormuz, fearing negative repercussions for Republicans in the November midterm elections, with a poll attributing 63% of the blame for high gas prices to Trump among Americans.
Airlines, through their representative Chris Sununu, have sounded the alarm at the White House: jet fuel costs have doubled, forcing ticket price increases of 21% and route cuts, with Spirit Airlines forced to shut down for this reason, while the sector is requesting $2.5 billion in federal aid.
The administration is trying to accelerate the end of the conflict, with Trump suspending plans to unblock commercial ships and mediators working on a deal with Iran, hoping prices will fall before summer, although experts warn it will take months to return to normal.
Trump advisers’ alarm
“Privately, President Trump’s advisers are increasingly worried that Republicans will pay a political price for the spike in fuel costs. Many of them are eager to end the war in the hope that prices begin to moderate before the November midterms.”
Pressure from airlines
“Sununu has sounded the alarm for weeks with Trump administration officials about the economic consequences of high jet fuel prices. The war must end soon, or things will get worse.”
Ticket increases and flight cuts
“Jet fuel prices have doubled in a few weeks. Airlines have raised ticket prices by 21% to $570 for a domestic round-trip economy flight. They are cutting flights that will no longer be profitable.”
Spirit Airlines failure
“The war has already caused a casualty in the sector: Spirit Airlines. Company representatives said they were forced to shut down because the sharp sustained increase in jet fuel prices derailed their Chapter 11 exit plan.”
Trump’s optimism for a deal
“Trump said the current oil price is ‘a very small price to pay to eliminate a nuclear weapon from really mentally unbalanced people.’ He suspended a plan to help commercial ships stuck in the Strait of Hormuz, expressing optimism for a deal with Iran.”
(Excerpt from the newsletter by Giuseppe Liturri)
