The situation in Iran has seen a dangerous escalation in the past 24 hours as the US and Israel have begun bombing Iran's Kharg Island. Looking at its location on a map, it's in the Persian Gulf, about 750 kilometers northwest of the Strait of Hormuz.
Kharg Island, with an area of 20 square kilometers, is roughly equivalent to 0.6 times the size of Macau or the Huangpu District of Shanghai. It is a small island, but it is the lifeline of Iran because 90% of Iran's oil exports pass through this island.
Despite Iran's long coastline, the Persian Gulf coast consists mostly of shallow, muddy shores , unsuitable for large ships or ports. Khark's advantage lies in the fact that the waters surrounding the island are over 30 meters deep, allowing for the construction of a port capable of accommodating 500,000-ton supertankers, making it Iran's only deep-water port for supertankers.
Therefore, starting in the 1960s, Iran began investing heavily in infrastructure on the island, constructing six undersea oil pipelines from the mainland to transport oil extracted on its own territory to Kharg Island, from where it is then exported by sea via the port. As you can see in the satellite image I posted above, there are many large cylindrical structures on the island, which are oil storage tanks with a capacity of nearly 30 million barrels.
It's ironic that the island's infrastructure was built by the Americans. At that time, the Pahlavi dynasty had close ties with the United States, and the two sides jointly developed Kharg Island, including the undersea pipeline, which was also built by the Americans. Until the 1979 coup, the "new" Iran directly confiscated foreign investment within its borders, the Americans were expelled, and billions of dollars in assets were nationalized.
Returning to recent events, the US and Israel just bombed and destroyed military targets on the island, but have not yet taken action against the oil facilities. This is Iran's red line. If Iran loses the oil revenue from Kharg Island, the Iranian government will lose 40-50% of its fiscal revenue, which is equivalent to losing half of its life, and the country will immediately face the risk of collapse.
Are there any alternatives or remedies? It's difficult. Iran is also trying to rebuild the port of Jask and restore some abandoned smaller ports, but this will take 6-12 months and will only have half the energy efficiency of Kharg Island at most. Given Iran's current financial situation, it's very likely it won't last more than 6 months.
Therefore, Iran warned that if anyone dares to target the oil on Kharg Island, Iran will cross all red lines and carry out every possible extreme retaliation. This makes sense; when someone is about to die, who cares about martial virtue?
Israel is eager to take action and has long wanted to bomb Kharg Island because they genuinely want Iran dead and aren't particularly concerned about high oil prices. The main issue is that the US hasn't made a firm decision. If Kharg Island were destroyed, oil prices could surge to $150, rendering the release of reserves useless, and the escalating situation with Iran would make a ceasefire even more difficult.
It is said that the United States and Israel are considering a plan to occupy Kharg Island. Before the war, Iran deployed 1,000-1,400 troops on the island, as well as naval and air forces. However, the island has been bombed in the past few days. There may still be several hundred ground troops. If the United States and Israel really attack, they probably won't be able to withstand it. They may take the initiative to bomb the island and withdraw, and then carry out a relentless retaliation.
In conclusion, Kharg Island will be the focus of the game in the coming week, and the situation in Iran and international oil prices could both be drastically affected by it. I just left a message on Trump's social media account urging him to make peace, hoping to contribute my small part to world peace. 
The situation in Iran has also taught me some new things, such as how difficult it is to restart an oil well once its production capacity is shut down.
I used to think that oil was like gold, silver, and copper—you could mine a little and it would produce a little, or you could temporarily shut down the mine. In reality, oil wells are very complex dynamic equilibria. They rely on the pressure of the rock formations to squeeze the oil out from underneath. If you choose to shut down the well and seal the outlet, there might not be a big problem in the short term, but over time, the underground pressure structure, fluid distribution, and rock formation conditions will change. Drilling again will cost a lot of money and time, and the production capacity will be permanently reduced and lost.
Therefore, major oil-producing countries like those in the Middle East and Russia are unlikely to open or close large numbers of wells due to fluctuations in oil prices, as both opening and closing wells incur huge costs, so they are extremely cautious.
As the situation in Iran escalates, the impact on the Middle East's oil industry is growing and showing a trend towards long-term effects. Even if a ceasefire agreement is reached, production capacity will be difficult to recover in the short term. Therefore, an overall rise in oil prices is an unavoidable trend, and this is the price that ordinary people like us have to pay.
Here are a few more questions that were frequently asked by netizens in the comments yesterday:
1. I know the gender of my readers because the statistics in the WeChat official account's backend show a consistent ratio of 2/3 male to 1/3 female. Other data includes: 50% are between 25 and 35 years old, and 30% are between 35 and 45 years old. Three-quarters of the users are from the Yangtze River Delta, Pearl River Delta, and Beijing-Tianjin areas, with Guangdong having the most at 21%. 46% of users use iPhones, etc.
The calculation of 2.35 billion yuan in red envelopes, averaging 700 yuan per person, is based on 500,000 people, which is correct. I divided it by the average daily readership. Those who follow but don't read the articles wouldn't get any money anyway.
3. The movie about clones that you mentioned is called "The Island," which seems to be a movie from 20 years ago. It's quite good.
That's all for now, have a great weekend!
Original Article: View Chinese Version
