Trump Can Defeat Iran Without Firing A Single Shot; The Numbers Tell The Story

Iran recently shot down a U.S. drone valued at $125 million and we were outraged. What many Americans don’t understand is that, even before Trump’s newly imposed sanctions, the daily loss of oil revenue to Iran caused by the existing sanctions is estimated at $120 million. So, every day, Iran loses almost as much revenue as the U.S. drone costs.


(Note: Business Insider’s Alex Lockie arrived at the $120 million figure based upon the price of crude on June 24th.)

Iran is losing $3.6 billion in revenue each month or $43.8 billion per year.

According to U.S. Energy Information Administration (EIA) estimates, “Iran’s oil net export revenue totaled $55 billion in 2017,” the last full year before Trump pulled out of Obama’s Joint Comprehensive Plan of Action (JCPOA), the Iran nuclear deal.

President Trump reimposed sanctions against Iran in November. He then ratcheted up the pain in May by ending sanctions waivers to countries that were importing Iranian oil.

Prior to Trump’s executive order last week which imposed new sanctions against Iran’s supreme leader Ayatollah Ali Khamenei and other top government officials, one Iranian compared the nation’s level of pain to feeling one’s “bones breaking.” In other words, the sanctions were eliciting the desired effect.

(Note: EIA estimates are based on tanker-tracking data reported by ClipperData.)

Reuters reported last week that Iran’s crude oil exports in June have fallen to 300,000 barrels per day (bpd). In Aril 2018, the month before Trump exited the Iran nuclear deal, Iran’s oil exports averaged 2.5 million bpd.


In addition to severe financial pain, Iran has other problems. Business Insider reports that their “currency has crashed, and the country has become gripped by protests and strikes. And it has felt a crackdown on the financial freedom for all of its citizens.”

According to the Associated Press, “Inflation is over 37%, according to government statistics. More than 3 million people, or 12% of working-age citizens, are unemployed. That rate doubles for educated youth.”

The Organization for Petroleum Exporting Countries (OPEC) is scheduled to meet in Vienna on Monday and Tuesday to determine if they will increase their rate of oil production in the second half of 2019. President Trump has called on OPEC to increase output to help bring down oil prices which hit a high of $75 in April before falling back to $66.

Reuters’ Alex Lawyer writes that Trump’s sanctions have deepened the impact of OPEC’s supply cuts. He wrote that “OPEC, Russia and other non-members, an alliance known as OPEC+, agreed in December to reduce supply by 1.2 million barrels per day from Jan. 1. OPEC’s share of the cut is 800,000 bpd, to be delivered by 11 members – all except Iran, Libya and Venezuela.” They are expected to renew the accord next week.


It cannot be denied that Trump’s sanctions have crippled the Iranian economy and will continue to do so. Will this be enough to bring the country’s leadership to the negotiating table? I’m not so sure about that. But it sure is an effective way to fight a war.


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