How much leverage does Iran really have over oil trade?
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Hello, everyone. I'm Kimberly Adams. Welcome back to Make Me Smart, where we make today make sense. Hi, and I'm Rima Kareis. Thank you for joining us, everyone. It is Monday, June 23rd. Today, we're gonna do some news, then some much needed smiles. Why don't we start with the news? I mean, there's really one huge story. Obviously, the US strikes on Iranian nuclear facilities over the weekend, which was just a

A huge development of the United States stepping into this war between Israel and Iran. And now Donald Trump is talking about regime change. Members of Congress are pushing for certain members of Congress, mostly Democrats, but a couple of Republicans.

Republicans pushing for a vote on the War Powers Act or trying to basically say that, you know, they want to deauthorize actions in Iran. But I'm sure everybody's been hearing about it all weekend. I have to say.

I was really stunned that he actually did it. I don't know about you. Oh, same. I was, yeah, I was kind of, I was on this like semi-remote island over the weekend and didn't really have internet access. And then I got an update. And I, yeah, I couldn't believe it at first. I thought that, yeah, it was a lot to wrap my head around. And then just been consuming news ever since on, you know, I'm just trying to make sense of it. Yeah, I see your news item is focused on that. So why don't you go first? Yeah, I'll start first.

So right now, I just want to add some context to some of the panicked headlines we're seeing right now around global oil trade. You know, what's going to happen? Should we be freaking out? Will we see oil prices go up? Let me first take a step back. So analysts are saying that one way Iran could retaliate is by closing off the Strait of Hormuz. That is a very crucial trade route. More than a fifth of the world's oil supply passes through it each day.

Now, a couple of things. So Iran's parliament supports closing it. But, but, but, but some important context. The final decision is up to the country's top leaders with the National Security Council. And the chances of that happening, according to experts, is actually very low. And in some ways, Iran would have the most to lose. It would risk provoking its trade partners, and especially China, which is very, very dependent on oil flows from the Gulf.

But that doesn't mean that there aren't other options. Like it doesn't have to be all or nothing. It could strike individual tankers or attack onshore facilities in neighboring countries or jam up GPS signals.

Now, what could any of this mean for our oil supply? So any obstructions would definitely rattle global markets. But the U.S., I should say, is better positioned to handle severe oil shocks because we produce a lot more energy than we did decades ago. There was a really good article about this in The Wall Street Journal this morning, and it noted that back in the 1970s, before the Iranian revolution and the second oil crisis, the

The U.S. was super reliant on foreign oil, right? But today, because of fracking, because of the shale revolution, the U.S. now produces so much oil and gas that we actually export more petroleum products than we import. The U.S. has net exports of about 2.5 barrels per capita, and we're also the world's largest seller of liquefied natural gas. That doesn't mean that we're totally immune to what's happening. We still very much rely on imports, but

It does change the calculus. And yeah, when you're talking about the sort of self-inflicted harm for Iran, you know, it's interesting because that is kind of their only economic lifeline. The sanctions that are in place have been so severe and been in place for so long that pretty much the only way that they can make any money is by, you know, selling oil to these very few countries that actually don't have sanctions on them. Exactly. Yeah.

Yeah. So, I mean, this is such a big story. It's sucking up all the oxygen. But I really hope people continue to pay attention to what's happening here in Washington. And I know that we spent all of last week on the reconciliation bill, but it's really coming down to some key points because.

President Trump is still pushing for Republicans to get this done by the 4th of July. I don't think that's very likely, but they're trying. And that means that they are flying through some of this legislation. And so we're probably going to get the Senate's like full new language passed.

Later this week, if not in the next 24 to 48 hours. But some of the things that we talked about and a lot of the questions we got last week were about some of these provisions that were in the bill that were super questionable. And what happened sort of on Friday and over the weekend is that the Senate has really been going through this birdbath, which is the checking by the Senate parliamentarian of various provisions that people raise today.

to see if they actually adhere to the terms of the reconciliation rules. And a lot of them do not. I mean, the parliamentarian has knocked out a ton of provisions that is, it's really sending Republicans scrambling, trying to figure out

What to do about this legislation. So some of them I've seen the Senate parliamentarian said no to a provision that would limit federal judges from issuing nationwide injunctions and basically force them to have like a bond in place. My colleague Nancy Marshall-Ginser was doing some coverage on that this morning. Plans to gut the CFPB, other plans that was this was reported in The Hill.

that would authorize states to conduct border security and immigration enforcement, which has traditionally been a task of the federal government. Senate parliamentarians said no to that. Also said no to some language that would increase contribution rates for new civil servants to the federal retirement system. Also said no to a provision of the bill that would allow the executive branch to reorganize federal government agencies or eliminate agencies without authorization

oversight and the parliamentarian is still looking at various components about this.

You know, it still is in process, in progress, and it's still worth paying attention to. And I would argue that as scary as this Iran stuff is, what happens with this piece of legislation, I mean, depending on how scary the Iran stuff gets, could potentially have more of an impact, of course, if this ends up.

having more spillover effects to, you know, God forbid, more global conflict. Obviously, that would have massive impact on all of us. But that is why we need some smiles. ♪

You know, I saw this article that you linked and I was going to choose it myself. Then I was like, I feel like I have a good feeling Kimberly's going to talk about it. And you did. Of course it is because it's space. Yeah, you have to. I love it. So the Vera C. Rubin Observatory, which is on top of a mountain in Chile, is now giving us beautiful and astonishing shots of people

Right.

But in the meantime, some of these images are really just beautiful. And it's nice to have a little reminder every now and then that we are all very, very small in the scheme of things. The BBC also has a really cool article about this with some photos of the inner workings of this observatory and also some beautiful shots of where it sits in this mountain range. And it's just so it's beautiful.

beautiful where it is and it's beautiful the images that we're getting back and so pretty pictures I will take them yes I always love a good perspective check yeah we are very tiny

I have my smile I feel like is on theme with the kinds of things I bring on this show. I am always bringing something around animals, I feel like. So I said that I went earlier, I said I went to this remote island. It's not really remote. Where I was staying was like out kind of in the middle of nowhere. But I went to Whidbey Island, which is in Washington State. It's not far from Seattle. It's very charming. Lots of small towns, dramatic coastal bluffs. It's got a lot of hiking trails and state parks.

And it's also known for whale watching. So I was hoping to spot some orca whales, but unfortunately didn't have any luck. But I did just being out there and learn more about them. Did you know that they're actually not whales? They're the largest member of the dolphin family and they're very tight-knit.

Yeah, but I learned even more this morning. There was an article in The Guardian about orca whales and how researchers have observed for the first time orcas mutually grooming each other with a kind of seaweed. So it's the first known instance of a marine animal using this kind of act in a cooperative way. So apparently they bite off pieces of bull kelp and rub them between their bodies and

give themselves like a little spa day. But it also helps them shed dead skin and remove parasites. It's also just a good social bonding thing. And yeah, I thought that was really beautiful. And it's so interesting because orcas have apparently been studied for decades, but researchers only noticed this behavior last year, thanks to drones technology, of course, which, but it's just, it's fascinating to me. Yeah, that's,

So I guess you can call them either killer whales or orcas, right? It's a misnomer. Yeah. I think it's because when they were first spotted by sailors, they thought that they were whales because they were killing them. I don't know. But yeah, it's not, it's not kind. Yeah.

We should call them orcas. Let's call them orcas. All right. Well, that's all for today. Tomorrow, join us for a deep dive on the situation in Iran. We're going to get more into it. We're going to take a step back and look at the history of the United States' rocky relationship with Iran, you know, the failed Iran nuclear deal and how it all led up to this point.

And yes, I know we promised last week that we were going to talk about overtourism. But, you know, news happens. There's a lot to talk about. So we will have to come back to that later. But in the meantime, whether it be about Iran or about what's happening here in Washington, please continue sending us your comments and your questions. You can send us a voice memo to makemesmartatmarketplace.org or leave us a voicemail at 508-U-BE-SMART.

Today's episode of Make Me Smart was produced by Courtney Bergseeker with help from Minju Park. Today's program was engineered by Jake Cherry. Daisy Palacios is our senior supervising producer. Nancy Farghali is executive producer of Marketplace Shows. And Joanne Griffith is our chief content officer.

I'm Nate Silver. I'm a journalist, a statistician, and a high-stakes poker player. I've spent my career analyzing elections, media, sports, poker, and how people make decisions under pressure. On my podcast Risky Business, I, along with my co-host Maria Konnikova, bring that lens to our headlines, breaking down the odds and risks behind momentous campaign strategies, decisive policy choices, and pivotal deals. We also share a few poker stories, our biggest bets, our baddest beats, and what they taught us about making better decisions.

Risky Business drops new episodes every week, wherever you get your podcasts.