Kharg Island, Iran. ISS005-E-11900, taken August 31, 2002, was provided by the Earth Sciences and Image Analysis Laboratory at Johnson Space Center. Additional images taken by astronauts and cosmonauts can be viewed at the NASA-JSC Gateway to Astronaut Photography of Earth.

Analysts believe that the United States is preparing to take Iran’s islands in the Persian Gulf. Some of these islands are key hubs for the country’s oil industry. The EIA outlined their value in a 2021 summary, writing:

Kharg Island, the largest export terminal in Iran, is located in the northeastern part of the Persian Gulf. Most of Iran’s crude oil exports are sent through Kharg, which includes a main terminal and a four-berth sea island (three of which are operational). The terminal processes all onshore production (the Iran Heavy and Iran Light Blends) and offshore production from the Foroozan field (the Foroozan Blend). NIOC has reportedly upgraded the terminal to handle a maximum loading capacity of 7 million b/d.[22]

Lavan Island mostly handles exports of the Lavan Blend, sourced from offshore fields. Lavan is Iran’s highest-quality export grade (35.4° API, 1.67% sulfur) and one of Iran’s smallest streams, at a production volume of about 115,000 b/d in 2018. Lavan’s storage capacity is 5.5 million barrels and has a loading capacity of 200,000 b/d.[23]

Sirri Island serves as a loading port for the medium-gravity, high-sulfur Sirri Blend produced in the offshore fields. Its storage capacity is 4.5 million barrels.[24]

Now, Treasury Secretary Scott Bessent has hinted at one possible future for Kharg Island, suggesting that Iran’s main oil hub may become U.S. territory. Bessent told Fox Business’s Maria Bartiromo that “we will see if that eventually becomes a U.S. asset.”

Several news outlets have reported that the USS Tripoli and its Marine expeditionary force have been dispatched to the area. There are also reports that the USS Boxer and its expeditionary force are also headed to the area. Many consider the troops movements to be a sign the U.S. will begin ground operations, potentially to take Iran’s islands.

Action Line: For investors, the best possible outcome is probably a quick, decisive end to the situation in the Persian Gulf, which leaves as much of the world’s energy infrastructure in place as possible and quickly returns energy flows to normal. Asset prices have been volatile in the face of rapidly changing information from the war zone, and investors with diversified portfolios are realizing the benefits of what Harry Markowitz called “the only free lunch in investing.” When you want to discuss a diversified portfolio and your risk tolerance, email me at ejsmith@yoursurvivalguy.com. And click here to subscribe to my free monthly Survive & Thrive letter.

Originally posted on Your Survival Guy.