It has given new urgency to a

classic strategic challenge: How

much harassment is the United

States willing to tolerate, and how

can it deter adversaries from test-

ing Washington’s red lines?

“The biggest question U.S. poli-

cymakers have to wrestle with is
that at some point, the Emiratis,
Saudis, Israelis and other Middle
Eastern allies, if they don’t believe
that the United States is going to
deter Iran on its own, they’ll be
looking for ways to deter Iran by
themselves,” said Raphael S. Co-
hen, who researches military
strategy and doctrine at the Rand
Corp

No U.S. personnel were harmed

in the Russian strike on Tanf. But
that was little solace to Kurilla,
who characterized the incident as
part of a wider attempt by U.S.
adversaries to assert dominance
in the region while betting that the
United States will not mount a
kinetic response.
“They’re going to push to what
they think our limits are going to
be and then reestablish our red
lines,” Kurilla told those assem-
bled in the bright morning desert
sun

he brush with Russia has coin-

cided with an escalation in provo-
cations by Iran and its proxies,
including a recent near miss at sea
when fast-attack boats operated
by Tehran’s Islamic Revolutionary
Guard Corps crept up on U.S. ves-
sels in the Persian Gulf, coming
within 50 yards of one. The Penta-
gon earlier this year scrambled in
response to attacks — orchestrat-
ed by Iranian-affiliated rebels in
Yemen — that targeted U.S. and
UAE troops at a base south of Abu
Dhabi

The Tanf garrison, located

along Syria’s borders with Jordan
and Iraq, still bears scars from an
Iranian militia attack in October.
Marks from where drones struck
the compound are visible on a
building near the U.S. military’s
command center, where a white-
board logs recent incidents within
the 35-mile deconfliction zone
that surrounds it. A floor-to-ceil-
ing map of the area marks exactly
what parts of the territory those
threats have rendered vulnerable.
The U.S. military has enough
firepower here to beat back an
attack, officials say: There are ar-
mored vehicles and two high-
mobility artillery rocket systems
with the range to hit anything
encroaching on the deconfliction
zone. But most of the time, as with
U.S. assets elsewhere in the region,
they sit unused because the per-
ceived dangers of responding with
force are judged to be too high

Iran routinely tries to test

where American red lines might
be and march up to that,” said
William Wechsler, director of Mid-
dle East programs at the Atlantic
Council and a former high-rank-
ing Pentagon official. “They’re try-
ing to establish an accepted set of
behaviors that work to their ad-
vantage ... and we have, in effect,
largely accepted these malign
norms of behavior over multiple
administrations.

In the Middle East, in particu-

lar, the United States is scaling
down after decades of war in Iraq
and Afghanistan. That creates op-
portunities for adversaries to flex,
experts say, and show they are a
force to be reckoned with.
In the case of Russia, the obvi-
ous factor driving tensions with
the United States is the war in
Ukraine. The Kremlin is furious
about the U.S.-led effort to con-
strain Moscow and arm Kyiv —
and its leaders, analysts say, are
worried about losing clout else-
where in the world. Kurilla attrib-
uted Russia’s increased bravado in
Syria to Colonel-General Aleksan-
dr Chayko, who has returned to
the Middle East after a stunted
tenure commanding Russian

But there is another element at

play: shifting signals from Wash-
ington. The Biden administration
has not shown the lenience
toward Russia espoused by his
predecessor, nor the unsparingly
hard line toward Iran. Unlike
President Donald Trump, Biden
has adopted a posture of defiance
toward Moscow while putting
greater emphasis on diplomacy
with Tehran, though the adminis-
tration insists it is not allowing
provocations to go unanswered.
“There is nothing President
Biden takes more seriously than
the security of U.S. personnel de-
ployed overseas,” said a National
Security Council spokesperson,
speaking on the condition of ano-
nymity under ground rules set by
the White House.
This person said that upon tak-
ing office, the Biden administra-
tion acted swiftly to deter attacks
by Iran-backed groups, deploying
a variety of tools, including mili-
tary strikes, plus diplomatic and
coercive measures.

Oil prices plummet as worries

of a coming recession continue
to grow

Oil prices soared this spring on

fears that the Russian invasion of
Ukraine would lead to supply
shortages and global disruptions.
They continued to climb after the
European Union moved to cut off
Russian crude, as part of a sweep-
ing array of sanctions to isolate
President Vladimir Putin and
punish his allies in Moscow and
abroad.
But Tuesday, oil prices fell
sharply, moving below $100 a bar-
rel for the first time since May. For
motorists, the sudden plunge is
double-edged: If oil stays below
$100, gasoline could fall as much
as 40 to 60 cents, according to
Patrick De Haan, chief of petro-
leum analysis for GasBuddy.
It will take weeks for such a
drop to be realized at the gas
station and, even then, some other
geopolitical event could send oil
prices spiraling back up. More
concerning to analysts is that oil
prices are falling because of grim
economic projections, serving as

sort of a canary in the coal mine

for declining economic activity
across the board.
There already are signs of a
pullback: U.S. demand for gaso-
line, measured as a four-week
moving average, dropped to
8.93 million barrels per day as of
June 24, a decline of 2.6 percent
compared with a year ago, accord-
ing to the Energy Information Ad-
ministration.
“While no one is wishing for a
recession, the fact of the matter is
that economic slowdown is one of
only two ways to meaningfully
bring down oil prices from cur-
rent levels,” said Pavel Molchanov,
director and equity research ana-
lyst at Raymond James, an invest-
ment bank and financial services
company.

On Wall Street, meanwhile, in-

vestors attempted to regroup after
stocks closed out their worst six-
month stretch to start a year since
1970 in the face of historically high
inflation, rising interest rates and
global supply chain disruptions
brought on by the Russian war
and the coronavirus pandemic.
More than $8 trillion has evap-
orated from the stock market this
year.
Changing monetary policy has
fueled much of Wall Street’s de-
cline this year: The Federal Re-
serve has raised its benchmark
interest rate three times in 2022
and signaled that four more in-
creases are on deck. The most
recent hike, in June, came in at
three-quarters of a percentage
point, the Fed’s largest since 1994.
On Tuesday, the Dow Jones In-
dustrial closed down more than
129 points or 0.4 percent, after
staging a comeback from deep
losses. The S&P 500 index ticked
up 0.2 percent, while the tech

Energy companies got pum-

meled after oil prices plunged —
West Texas Intermediate crude,
the U.S. benchmark, slumped
more than 8 percent to $99.70 a
barrel, while its global equiva-
lent, Brent crude, fell 9.2 percent,
to trade near $103. Shares of
ConocoPhillips and Marathon Oil
Corp slid by more than 6 percent,
Halliburton fell by 8 percent,
while Occidental Petroleum
Corp. decreased by 2.2 percent at
the closing bell.
Lindsey Bell, Ally’s chief mar-
kets and money strategist, said in
an email on Tuesday the big un-
known is how deep or widespread
the stock market slowdown will
be. “With a 20% decline in the
first half of the year, stocks are
pricing in what could be a mild to
medium sized recession,” she
said

State Antony Blinken will meet

with Chinese Foreign Minister
Wang Yi this week, according to
senior State Department officials,
as the Biden administration
weighs lifting tariffs on China to
dampen inflation. But officials ap-
pear to be conflicted on what path
to pursue, as inflation soars to
8.6 percent.
Treasury Secretary Janet L. Yel-
len has told lawmakers that some
of the Trump-era tariffs were stra-
tegically questionable and “paid
by Americans, not by the Chinese.”
But U.S. Trade Representative
Katherine Tai has voiced a con-
flicting view to Congress, saying,
“The China tariffs are . . . a signifi-
cant piece of leverage, and a trade
negotiator never walks away from
leverage.”
Investors, meanwhile, are pull-
ing back on the belief that the
potential rollbacks of the tariffs on
Chinese goods may not material-
ize, said Ally’s Bell.
As world leaders grapple with
ongoing financial tensions, Amer-
ican consumers have become in-
creasingly less confident about
the economy, with consumer sen-
timent measures plunging to rec-
ord lows.
Despite the souring sentiment,
however, American consumers
continue to shell out for goods and
services, in what has shown to be a
bright spot for the U.S. economy.
But economists say there are signs
that is beginning to change, as
consumers feel the effects of high-
er interest rates and dip into their
savings to keep their household
budgets afloat.
The broad deterioration in con-
sumer sentiment “may be a sign
that consumers intend to pull
back from spending amid increas-
ing fear of a more challenging
economic environment on the ho-
rizon,” according to a new re-
search note by the investment
management firm Glenmede