Bullets:
Iranian drones cost less than $50,000 to build and deploy. Yet they are taking down multi-billion-dollar fixed assets all across the Persian Gulf.
Just a few examples: Bahrain’s sole oil refinery, previously running over 400,000 bpd; the largest Mideast refinery, in the UAE, with capacity of over 900,000 bpd; the world’s busiest international airport; the American embassy and consulate in Iraq.
Warfighters in Washington and Tel Aviv insist that the war against Iran, measured conventionally, is already over. Iran’s navy, air defenses, and air force have been decimated.
But low-cost drones and missiles can be deployed from anywhere, and launched at anything. High-value fixed assets are vulnerable, and for the first time in history the cost of defense is orders of magnitude greater than for attacking forces.
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Report:
Good morning.
This was posted on one of the Substacks we really like, Gold and Geopolitics. The BAPCO refinery in Bahrain – Bahrain’s only refinery—was hit by drones and shut down. A 90-year-old refinery taken out for the cost of a Honda Civic. And that is a very healthy way to read all these headlines now, coming out of the Middle East.
The Shahed drones launched by Iran, at these targets, cost less than $50,000 to build and put into the sky. That BAPCO refinery was expanded recently, to a capacity of over 400,000 barrels of oil per day, which significantly increased Bahrain’s refinery output last year. Now it’s gone.
The biggest refinery in the Middle East is the one in the UAE, run by ADNOC. Another drone, which cost about the same as a used F-150 pickup, shut down that plant, which refines over 900,000 barrels of oil a day. It’s the central hub for the entire country’s energy complex.
Two drones, and over a million barrels of oil a day go offline. Oil is over a hundred dollars a barrel. So Iran spent around a hundred thousand dollars on some drones—one time–to take down two refineries processing over $100 million of crude oil, every day.
The world’s busiest international hub for air travel is Dubai Airport. A handful of drones have hit there. On 16 March, a drone with the same book value as a 10-year-old BMW crashed into a fuel depot. Sixty-five flights were diverted to 34 airports, including “22 flights to nowhere”, whatever that means.
Then the government of Dubai announced that their airports were closed to foreign airlines until further notice.
Another drone strike: this one on the American embassy in Iraq, with “explosions heard near the diplomatic compound”. Three more drones were launched at another diplomatic facility near Baghdad Airport.
That prompted a Security Alert issued by the US Embassy Baghdad, 17 March:
US Citizens should leave Iraq now. The International Zone is closed. Do not attempt to come to the embassy in Baghdad, or to the consulate in Erbil, because the US government has a limited ability to provide emergency services to US citizens in Iraq. Do not travel to Iraq for any reason. If you’re there now, get out now.
That’s not easy, because the airspace is closed, but land borders are open. Generally. Expect long delays. If that all sounds very discouraging, this might help us feel better:
The President and the State Department “have no higher priority than the safety and security of American citizens.”
____
What is the cost, to the Iranians, of all this chaos and carnage? Just those three examples, which cost them around $300,000? But then consider the damage there: Major refineries taken offline, the world’s largest international airport shut down, the US Embassy closed and American citizens in Iraq trying to find Uber drivers heading to Jordan or Turkey. We know it’s untold billions and billions of dollars in lost oil sales and airline revenues—which are still rising every day those refineries are down and ships can’t move and passengers aren’t booking tourist flights–plus incalculable damage to American prestige now that it’s known that we cannot defend our own diplomatic stations.
This asymmetry is in the extreme. It’s a rhetorical question, why bother to shoot these drones down at all, given that the cost to manufacture these drones is far under $50,000, and the cost to intercept them is 20 or more times that.
And this is why. Multi-billion dollar assets – oil refineries, pipelines, airports, desalination plants, ports and harbor facilities – they’re sitting ducks.
And officials in Washington and Tel Aviv who remind us that Iran’s navy was sunk on the first day, Iran’s Air Force was destroyed in the first hour --none of that matters. Because it used to be that you did need an Air Force to blow up another country’s oil refineries, and you did need a navy to attack another country’s ports.
Now you just need $50,000.
Be Good.
Resources and links:
UAE suspends foreign airline operations from Dubai airports
https://www.ch-aviation.com/news/164878-uae-suspends-foreign-airline-operations-from-dubai-airports
MAPPED: 65 planes were diverted as a drone strike caused flight chaos at Dubai Airport once again
https://africa.businessinsider.com/transportation/mapped-65-planes-were-diverted-as-a-drone-strike-caused-flight-chaos-at-dubai-airport/mf8gjbr
Security Alert: U.S. Embassy Baghdad, Iraq – March 17, 2026
https://iq.usembassy.gov/security-alert-u-s-embassy-baghdad-iraq-march-17-2026/
UAE oil giant ADNOC shuts Ruwais refinery after drone strike, source says
https://www.reuters.com/world/middle-east/fire-hits-site-housing-abu-dhabi-national-oil-company-operations-after-drone-2026-03-10/
Gold and Geopolitics
[
Gold and Geopolitics
G&G: Gold and Geopolitics
By No1](https://no01.substack.com/)
Bahrain’s Bapco issues force majeure after refinery hit
https://www.argusmedia.com/en/news-and-insights/latest-market-news/2798255-bahrain-s-bapco-issues-force-majeure-after-refinery-hit
Iran’s Drones Cost a Fraction of the U.S. Weapons Shooting Them Down
https://www.nytimes.com/2026/03/04/business/iran-shahed-drones-missiles-us-war.html
More than 100 Iranian naval vessels destroyed, and ‘we aren’t done,’ CENTCOM leader says
https://www.stripes.com/theaters/middle/_east/2026-03-16/centcom-update-operation-epic-fury-day-16-21086277.html
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