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Welcome to The Geopolity’s What We’re Watching (3W), our daily look at the interconnected worlds of Geopolitics, Economics and Energy. Curated from the world’s leading sources of information, our analysis and commentary is designed to help you make sense of the events driving the major developments in the world.
In this roundup, we take a closer look at the continuing tensions between the US and Iran.
While the US is keeping up the pressure, adding ever more ships to its “armada” in the Indian ocean, there is a flurry of diplomatic activity behind the scenes involving Turkey, Egypt, and Saudi Arabia.
There is speculation these countries are forming an informal alliance, as they realize that if Israel gets its way with Iran, they are likely to be a next target of the US – Israel Alliance. 3W hopes so, as this is in fact the truth, but we note these countries have a long history of sacrificing their own interests on the altar of worship to their colonial masters.
Meanwhile, Iran is signalling both willingness to talk about its nuclear program, as well as preparations for a war. This, one must say, is the correct position. As to its preparations for war, Iran is threatening closure of the Strait of Hormuz, and 3W explains why this should be expected to cause a collapse of the global economy.
Furthermore, we look at:
- Israel’s escalation of its genocide against the people of Gaza, which, predictably, comes days after the last Jewish prisoner of war was repatriated from the Strip
- The US victory over China in their struggle over the Panama Canal
- The US stranglehold over Cuba
- US president Trump pick for Federal Reserve chair
Geopolitics
On Friday, US president Trump intensified pressure on Iran, imposing fresh sanctions and urging the regime to “make a deal,” writes Bloomberg.
Iran’s foreign minister Abbas Araghchi says Tehran is ready to resume nuclear talks with the US, writes Axios. But, he stressed the Trump administration needs to stop threatening an attack against Iran. Araghchi’s new remarks came at a press conference with his Turkish counterpart in Ankara. In recent days, Turkey has been the leading mediator trying to facilitate direct negotiations between the US and Iran. Egypt, Qatar and Saudi Arabia also passed messages between the parties in an effort to de-escalate the situation, adds Axios.
As to why the Middle Eastern powers Turkey, Egypt and Saudi Arabia are hustling, Trita Parsi of the Quincv Institute – much respected here at 3W – writes on X that it is not just because they recognize that escalation will be uncontrollable, or that the war will spread instability and refugee flows throughout the region. It is because the US lifted the (few) restraints it imposed on Israel following October 7. Israel has since then attacked seven countries in the region and presented itself as the enforcer of “American” hegemony in the region. These countries also learnt that their alliance with the US will not protect them from Israel’s increasingly aggressive and reckless approach in the region, given Israel’s ability to strike Qatar without the US defense systems even getting activated. In this scenario, it is logical for these states to seek other ways to balance against Israel. Iran is not formally part of this bloc, but it is a de facto buffer between this bloc and Israel. If Iran is further weakened, destabilized, or even worse, if a pro-Israel regime is installed there, this will be a major blow to these countries in their involuntary competition with Israel and its Emirati ally. 3W notes that one would almost hope that Parsi is correct, as a unified block of Middle Eastern powers would provide a counterweight against the arrogant and aggressive US – Israel Alliance. But, we also note that the Middle East does not have a long history of such independent geostrategic thinking on the part of the Middle Eastern powers, whose modus operandi since their establishment as part of the UK – France “Sykes Picot Agreement” has been more about serving the colonial masters. It is not impossible, therefore, and perhaps even more likely, that the Middle Eastern powers are in reality acting in accordance with the US – Israel Alliance plan against Iran.
The US – Israel Alliance appears to be betting that it can maintain hegemony over the Middle Eastern powers, despite this conflicting with the interests of these powers. The US dragged Saudi Arabia’s defense minister Khalid bin Salman (KBS) in front of a crowd of Zionist organizations, who demanded he do more to support Israel and “combat” the criticism of Israel in Saudi media, writes Axios. 3W notes two things in this regard. Firstly, the event highlights how Israel’s interests are the US priority when it comes to the Middle East – not US interests. Or to put it more bluntly, it highlights that Zionists set the US agenda for the Middle East, that is why KBS had to report to them while visiting Washington DC. Secondly, the event provides insight into how the empire works behind the scenes. In closed sessions foreign dignitaries are pressured to submit and prove complete loyalty to the empire.
In the background to the diplomatic moves, Iran prepared to launch a military drill in the Strait of Hormuz, writes The Associated Press. Iran has warned ships that it will conduct a live fire drill Sunday and Monday in the strait. 3W notes this drill is quite clearly designed to the let the Alliance know what Iran can do, if it is attacked. Bloomberg writes about a closure of the strait could result in. In the 3W view, a disruption of traffic through the strait would severely affect global energy flows, thereby disrupt the functioning of the global economy, which would likely trigger a massive implosion in the world’s financial markets akin to the 2008 Global Financial Crisis.
As to Gaza, Israel renewed shelling and bombardment of several areas across Gaza on Saturday, killing at least 27 people, including children, writes The National. Israel targeted displacement tents where people have sought refuge from the cold under flimsy tarpaulin shelters, killing seven members of the same family, including five children. A Palestinian paramedic in Gaza said he, and many others, “expected” that Israel would intensify its attacks on the Strip. “You kept asking me whether I’m happy about the ceasefire. But this is what we all expected would happen. Why would they not attack us more now that Hamas has played its last trump?” he told The National. In another breach of the agreement, Israel has so far not opened the Rafah border crossing with Egypt for the entry of aid, return of Palestinians abroad and departure of the injured in need of medical treatment. It has also not adhered to the withdrawal lines stipulated in the ceasefire agreement, did not allow the entry of materials necessary for repairing and rebuilding the damaged infrastructure, blocked the entry of heavy machinery for rubble removal and body recovery, and kept tight limits on aid entry into the strip.
Beyond the current hotspots in geopolitics, a Panamanian court voided Hong Kong conglomerate CK Hutchison’s contracts to operate terminals at both ends of the Panama Canal, writes Nikkei Asia. For context, CK Hutchison role in the Panama canal was behind US president Trump’s threats against Panama early in 2025. Weeks after Trump was inaugurated, CK Hutchison then struck a nearly $23 billion deal to sell the ports and dozens of others to a consortium led by US investment firm BlackRock and Mediterranean Shipping Co. (MSC). China was angry at this and started pushing its state shipping group COSCO to take a “significant” stake in CK Hutchinson before the deal went through. In the 3W view, the US has now solved the issue through “guiding” the court process in Panama. Panama’s comptroller, Anel Flores, who filed lawsuits to void the contracts, argued the 2021 renewal of the concessions for 25 years was “unlawful,” and that auditing had turned up “irregularities.” He also called the arrangement “abusive” to Panama’s interests. In response, “China will take all measures to protect the lawful rights and interests of Chinese companies,” Foreign Ministry spokesperson Guo Jiakun said.
Further in Latin America, Cuba is starting to suffer from the stranglehold the US has imposed on the country, writes Reuters. Electricity and fuel shortages are taking hold, as Venezuela and Mexico have halted oil shipments to the island under US pressure. Cuba’s peso has also lost more than 10% of its value against the dollar in three weeks, pushing up the price of groceries – a development eerily similar to Iran ahead of the protests there, 3W notes. “Regime change” is almost certainly coming to Cuba, in our 3W view.
Macroeconomics
US president Trump is expected to nominate Kevin Warsh, a central bank insider-turned-critic, as Federal Reserve chair, writes The Wall Street Journal. Warsh, 55, has long positioned himself to return to lead an institution he once served—and has spent years publicly criticizing it. A former Fed governor who played behind-the-scenes roles during Washington’s rescue of Wall Street in the 2008-09 financial crisis, Warsh lost out on the top job to Powell in 2017. Recently, Warsh has aligned himself more closely with Trump’s views—embracing the president’s tariff policies after years as a free-trade advocate and calling last year for the Fed to cut interest rates faster. Warsh had been considered a leading candidate for the job along with Kevin Hassett, the director of the White House National Economic Council. Warsh was widely seen as the front-runner after Trump earlier this month said he preferred to keep Hassett in his current post. Treasury Secretary Scott Bessent managed the search and had presented Trump with two additional finalists: Rick Rieder, a senior executive at BlackRock, and Christopher Waller, a current Fed governor whom Trump appointed to the board in 2020. The Financial Times writes about all the things Walsh is likely to try and change at the US Fed.