Earlier today, The Common Sense reported that talks in Pakistan aimed at ending the war in Iran had to be postponed after Iran refused to send its delegation to meet the Americans.

In the aftermath, the American government, after considering its options, decided to unilaterally extend the ceasefire while also maintaining its blockade of Iranian vessels or those with Iranian cargo seeking to break out of the Strait.

The Iranian Revolutionary Guard Corps (IRGC), in seeking to up the ante, has subsequently begun firing on commercial shipping in the Strait in an effort to halt the flow of any vessels and goods from Gulf ports. The tactic should succeed in that shipping insurers are likely to pull cover from vessels looking to run the Strait.

Initial indications from Washington this evening are that the United States (US) will not immediately resume offensive strikes or bombing of Iran but instead maintain its cordon.

Sources in the US say this may continue until the Iranians present a 'unified proposal' for talks to resume. By that, they mean a proposal that has the support of both civilian government and military actors in Iran.

The Common Sense reported earlier on an apparent split between the civilian leadership in the country and the IRGC – although this may also just be a device to stall talks, while making aspects of the Iranian regime appear reasonable and even moderate.

The impact of the Iranian attacks will be more severely felt in parts of Asia than in America and much of the West. China is particularly vulnerable given its finite oil reserves. But even in the East, the effects will be spotty, with India's economy set to exceed its January 2026 economic growth forecast.

The Common Sense is led to believe that China's entering the fray to rein in the Iranians is regarded as a plausible exit point for the war. China's economic growth forecasts have been revised downwards over recent years and, while still very strong, the Chinese economy faces various debt dynamics that could trigger a domestic growth and political crisis in the event of serious oil shortages.

The Common Sense is further led to believe that chaos in the Strait is seen as useful by certain Western actors as motivation to see Europe break out of its dependency on Middle Eastern energy and to develop more of its own oil reserves while picking up any shortfall from America. This would echo what happened with European gas purchases after the 2022 sabotage of the Nord Stream pipelines that had fed Russian gas to Europe.

Meanwhile, the United Kingdom (UK) is set to host a meeting of Western actors to consider strategies to safeguard the Strait, although this is seen as a largely symbolic act given that neither the UK nor the balance of the European Union has the resources or political bearing to undertake such an operation.

In America, a careful balance continues to be struck between the continuing war, fuel prices, and midterm elections in November. To date, however, Republican support for the war has held up strongly, while gasoline prices have not broken well beyond their inflation-adjusted averages. Fertilizer stockpiles have also been sufficient for American farmers to get down to this year's crop planting season. For all those reasons, the White House may believe that it still has time in the bank to let the pressure of its cordon do its work on Iran's leadership – either to fracture that via a coup or to force a unified position on talks towards a lasting ceasefire.

Such a ceasefire would likely have the effect of sharply dropping gasoline prices and driving equity markets even higher, creating a useful electoral background for Republican hopes of holding the Senate and perhaps even the House.