What is the core of the resurgence of the US Iran conflict? The core United States wants to break through Iran's control over the Strait of Hormuz, but Iran is not backing down on this. You can tell from the location of the three merchant ships when Iran launched an attack on them early Wednesday morning. These three merchant ships were basically on the southern route of the Strait of Hormuz near Oman, while Iran's designated route was on the north side of the strait near Iran. This reveals the cause of this conflict: the United States instigated merchant ships (otherwise they would not dare to act) to seek to open up a southern waterway that was not controlled by the Iranians, which was discovered by Iran, while the Iranians sought to use force to effectively control the strait. 1. Therefore, the most acute problem at present is not the nuclear facilities, but the "who the final say" in the Strait of Hormuz: 1) Trump understands that the opening is "the restoration of normal international waterways and the unconditional opening of all waterways"; 2) Iran understands that 'Iran is responsible for ensuring security, therefore ships must obey Iran's designated routes and management'. 2. Both sides have incentives to exchange limited upgrades for better conditions: 1) The United States hopes to prove the credibility of the red line through military strikes, but faces pressure from high oil prices, gasoline prices, and the November midterm congressional elections; 2) Iran needs to lift sanctions and restore its economy, but is unwilling to publicly show concessions after the US bombing In fact, both sides are calculating one thing: As long as the scale of retaliation is controllable, it is possible to strike first, increase the cost of the other party, and then return to the negotiating table. 3. What is the intention behind the United States' breakthrough move in seeking air routes 1) Trump may not have accepted a cruel reality: it is impossible to restore the Strait of Hormuz to its pre war state; 2) We also need to show firmness from time to time, appease domestic opposition voices and emotions, in order to boost support rates and elections. The United States has absolute air and long-range strike advantages, but Iran still retains asymmetric capabilities capable of creating a global energy shock. For Trump, it is either to buy back the international navigation rights of the Straits in disguised form (pay huge amounts of money to Iran to let Iran give up control), or to completely destroy the Iranian regime and military strength (it seems that Trump has no intention of this step now). 4. What should we do next? 1) The current baseline scenario should be to engage in talks while fighting, and to repeatedly and briefly cease fire. Both parties maintain communication through Oman, Qatar, and Pakistan. Both sides have economic and political needs to continue negotiations, but neither has the ability to accept the other's core conditions. Then there will be 'hit, stop, talk again'. 2) The compromise proposed by Oman afterwards is ultimately the most likely: international navigation rights will not be affected, but regional joint management, safety, environmental protection, and navigation service mechanisms can be established, and service fees have clear service correspondences and cannot be regarded as "tolls". This can be packaged into a plan that is acceptable to all parties: the United States can say that the strait maintains international passage; Iran can say that its security management rights have been recognized 3) Mid August is a critical juncture The 60 day negotiation window set in June will approach its end during this period. If there is only temporary arrangement in the Straits and no nuclear material road map, Trump will have to extend the negotiation by means of "sanctions+local military strikes". 4) Impact on the market The core is still oil prices. As long as oil prices do not remain in the range of 80-85 or even higher for a long time (with little impact in the short term), it will still be a disturbance to the market. This article is sponsored by @ bitget_zh, titled 'Bitget Buying US Stocks: Instant Entry, Smooth Trading'