On Tuesday, the ubiquitous “people familiar with the matter” told the Western financial press that Iraq was beginning to shut-in production at the Rumaila field, a super-giant.

If the Trump administration wasn’t worried enough about marooning a meaningful share of the world’s oil supply in the Persian Gulf, a 700,000 bbl/d cut from Rumaila and another 460,000 bbl/d reduction from West Qurna 2 (also in Iraq), was a wakeup call.

Having apparently exhausted its storage capacity, and with the Strait of Hormuz de facto closed, Iraq finds itself compelled to cut production by almost 1.5 million bbl/d all told (and, more to the point, already). Officials predicted that figure could double by the end of the week. That’d mean three-quarters of Iraqi supply going offline.

As I put it two days ago ahead of the OPEC+ meeting, the cartel can “tip a larger production hike” from April, but that’s “meaningless if you can’t safely get the stuff out of there.” “There” is the Gulf. The “stuff” is oil. And right now, it’s stranded product.

Shut-ins are no good, and it’s fair to say no storage contingency planning’s sufficient to cope with an indefinite closure of the exit route for a fifth of the world’s oil supply.

On some interpretations, this is Iran’s fault for — I don’t know — being a militantly mischievous Shia theocracy instead of a fundamentalist Sunni monarchy. But whoever deserves historical blame for what, a half century on from the Revolution, is a full-blown war, America’s in a “you break it, you buy it” bind as it relates to oceangoing oil.

Donald Trump knows that, and on Tuesday he offered cheap insurance to anyone willing to take their chances in a dire Strait. Failing that, he’ll provide another kind of insurance for transiting energy vessels: US warship escorts.

“I have ordered the United States Development Finance Corporation to provide, at a very reasonable price, political risk insurance and guarantees for the Financial Security of ALL Maritime Trade, especially Energy, traveling through the Gulf,” he said, after oil rose sharply for a second day.

“If necessary,” he went on, “the United States Navy will begin escorting tankers through the Strait of Hormuz.” Either way, America “will ensure the FREE FLOW of ENERGY to the WORLD.”

Brent, which traded north of $85 earlier, briefly fell below $79.

Will this work? Well, I don’t know. The DFC idea’s probably insufficient on its own, and Trump offered no details, presumably because there aren’t any yet. The promise of cheaper loss insurance is great, but you could (pretty easily) be killed trying to “drive” a tanker through that channel right now. The warship escorts help ameliorate that latter problem.

But Trump drew a distinction between the timeline on the insurance backstops (“Effective IMMEDIATELY”) and the naval escorts (“as soon as possible”). I don’t know about anybody else — which is to say I can’t speak for the psychology of tanker crews, who I imagine are accustomed to risk-taking — but I’m not piloting a vessel past Iran right now unless I have a US warship with me. So, Trump needs to say when those escorts will be available.

Earlier Tuesday, during an Oval Office meeting with Friedrich Merz (who isn’t a fan), Trump suggested Iran might’ve attacked the US or Israel first if he hadn’t pulled the trigger late last week.

“I thought we were going to have a situation where we were going to be attacked,” he mused, presumably referring to US bases in the region which, on the off chance you haven’t noticed, were attacked anyway. (Iran obviously has no missiles capable of hitting the US mainland.)

During the same meandering remarks, Trump conceded that oil prices may be “a little high for a little while,” but said they’ll drop “as soon as this ends.”

Asked about the future of the Iranian government, and specifically whether he has a plan for a successor regime, Trump said, “Most of the people we had in mind are dead and we [had] another group [but] they may be dead also.”

“I guess the worst case would be we do this and then somebody takes over who’s as bad as the previous person,” he added. “That could happen.”

[Insert face palm emoji]