Hegseth Warns “Most Intense Day” Of Operation Epic Fu…

The most significant development in the Strait of Hormuz on Tuesday was the start of IRGC naval mining operations, which were met with massive U.S. firepower that destroyed 16 mine-laying vessels. As we continue monitoring the maritime chokepoint this morning…

The most significant development in the Strait of Hormuz on Tuesday was the start of IRGC naval mining operations, which were met with massive U.S. firepower that destroyed 16 mine-laying vessels. As we continue monitoring the maritime chokepoint this morning after IRGC attacks on three commercial vessels, attention is now shifting to the IRGC’s drone production capacity, which appears to have been degraded.

Bloomberg reports that 2,100 Shaheds have been fired so far in the 12-day conflict. U.S. forces struck IRGC production facilities, disrupting large-scale manufacturing. The report is based on comments from a senior European official. “Since the Houthis have produced UAVs under bombardment, one would think the Iranians can, albeit not at the same rates, since facilities have to be dispersed and makeshift workshops used,” Sid Kaushal, a senior research fellow at the UK-based Royal United Services Institute, told the outlet.

The Wall Street Journal reported earlier that Saudi Arabia’s kill-cost ratio, neutralizing $20,000 IRGC drones with $2 million-plus missiles, has spurred talks with a Ukrainian counter-drone company for cheap interceptor drones. America-Israel’s Operation Epic Fury entered its 12th day, with U.S. Defense Secretary Pete Hegseth indicating that the most intense phase of U.S. strikes is expected on Wednesday.

Tehran responded with retaliatory strikes against Gulf neighbors, as Goldman’s foreign affairs chief warned of a growing risk of regional spillover (read here). Overnight, market attention centered on energy, with the IEA reportedly proposing its largest-ever emergency crude release to combat Brent and WTI prices, which have reached triple-digit territory. “The most fighters, the most bombers, the most strikes.

Intelligence more refined and better than ever. So that’s on one hand,” Hegseth said. “On the other hand, the last 24 hours have seen Iran fire the lowest number of missiles they’ve been capable of firing yet.” Around 0900 ET, the IEA is expected to announce plans for a massive crude release into the market to cap Brent and WTI prices, which surged near $120 per barrel at the start of the week.

In a note to premium subscribers, we outlined several problems that could arise and why any such release would only offer temporary relief. Beyond the panic among G-7 leaders and the IEA over crude prices, the Trump administration has also pushed its own headlines on Tuesday in an effort to jawbone energy prices lower, as we explained here. Jawboning headlines from G-7 and the Trump administration on Tuesday were shortly followed by headlines that Iran had begun mining the Strait of Hormuz.

That came after President Trump warned Tehran not to “put out any mines” in the narrow waterway. Shortly afterward, the U.S. military said 16 Iranian mine-laying naval vessels had been eliminated. Overnight reports described heavy U.S. and Israeli strikes on IRGC targets, with damage reported to oil facilities, civilian sites, and a hospital in Bushehr taken out of service. Iran has claimed that nearly 10,000 sites have been hit overall.

There are currently no signs of de-escalation from either side, with IRGC spokesman Ebrahim Zolfighari warning the Trump administration at the start of the week: “If they can afford the price of oil at $200 per barrel, let them keep playing this game.” The latest casualty report states that more than 1,200 people have been killed by U.S. and Israeli strikes in Iran, according to the Iranian Red Crescent Society, and 13 have died in Israel as Iran retaliated with missiles and drones.

Chief Pentagon spokesperson Sean Parnell said that 140 U.S. service members have been wounded in the conflict so far. “The vast majority of these injuries have been minor, and 108 service members have already returned to duty,” Parnell said. “Eight service members remain listed as severely injured and are receiving the highest level of medical care.” If there is a quick de-escalation of the US-Iran conflict by mid-March with no damage to critical oil infrastructure and flows via Hormuz resume, Henri Patricot sees Brent averaging $80/bbl in March, before dropping to the mid-$70s.

TTF gas prices would hold €50/MWh, before falling to the high-€30s in 2Q26. In the case where Hormuz disruptions persist for a month, both oil and gas markets would further tighten, increasing the pace of inventory drawdowns and supply shut from GCC countries. Here, he expects oil prices to rise above $100/bbl in the second half of March, averaging $100/bbl in March and $78/bbl for 1Q26, before coming down to $90/bbl in 2Q26 as disruptions ease.

For gas, LNG supply would be reduced for longer, requiring more demand reduction, especially as spare capacity and storage are limited. He would expect TTF to rise towards €80/MWh by end-March, averaging €65/MWh in March and €46/bbl for 1Q26, before coming down to €50/MWh in 2Q26. In the final scenario, where there is extended disruption (longer than a month), Brent prices could average $110/bbl in March and might climb towards $150+ by 2Q26.

On the gas side, TTF could average €73/MWh in March and rise to €80/MWh in 2Q26. What’s clear is that the Middle East conflict has sent macroeconomic uncertainty soaring across the world, despite the White House saying the surge in energy prices is temporary. The big headline this morning will be around 0900 ET from the IEA on crude inventory releases. Iran has launched retaliatory strikes at United States air bases after joint attacks with Israel…

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Summary

This report covers the latest developments in pakistan. The information presented highlights key changes and updates that are relevant to those following this topic.

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