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Iran: Oh, No; Not Again

Wednesday, January 11, 2012, 10:04 AM

In each of the years 2008, 2009, and 2010, significant worries emerged that Western nations might attack Iran. Here again in 2012, similar concerns are once again at the surface.

Why revisit this topic again? Simply because if actions against Iran trigger a shutdown of the Strait of Hormuz, through which 40% of the world's daily sea-borne oil passes, oil prices will spike, the world's teetering economy will slump, and the arrival of the next financial emergency will be hastened. Even if the strait remains open but Iran is blocked from being an oil exporter for a period of time, it bears mentioning that Iran is the third largest exporter of oil in the world after Saudi Arabia and Russia.

Once again, I am deeply confused as to the timing of the perception of an Iranian threat, right now at this critical moment of economic weakness. The very last thing the world economies need is a vastly increased price for oil, which is precisely what a war with Iran will deliver.

Let me back up. The US has already committed acts of war against Iran, though no formal declaration of war has yet been made. At least if Iran had violated US airspace with stealth drones and then signed into law the equivalent of the recent US bill that will freeze any and all financial institutions that deal with Iran out of US financial markets, we could be quite confident that these would be perceived as acts of war against the US by Iran.

And rightly so.

U.S. imposes sanctions on banks dealing with Iran

Dec 31, 2011

(Reuters) - President Barack Obama signed into law on Saturday a defense funding bill that imposes sanctions on financial institutions dealing with Iran's central bank, while allowing for exemptions to avoid upsetting energy markets.

The sanctions target both private and government-controlled banks - including central banks - and would take hold after a two- to six-month warning period, depending on the transactions, a senior Obama administration official said.

Sanctioned institutions would be frozen out of U.S. financial markets.

(Source)

The impact of this law was quite pronounced and immediate, with the Iranian rial falling sharply against the dollar in the first few days after the bill was signed into law.

Iran's rial falls to record low on U.S. sanctions

Jan 3, 2012

Jan 3 (Reuters) - The Iranian rial fell to a record low against the dollar on Tuesday following U.S. President Barack Obama signing a bill on imposing fresh sanctions against the country's central bank.

The new U.S. sanctions, if fully implemented, could hamper the world's major oil producer's ability to sell oil on international markets.

The exchange rate hovered at 17,200 rials to the dollar, marking a record low. The currency was trading at about 10,500 rials to the U.S. dollar last month.

Some exchange offices in Tehran, when contacted by Reuters, said there was no trading taking place until further notice.

"The rate is changing every second ... we are not taking in any rials to change to dollar or any other foreign currency" said Hamid Bakhshi in central Tehran.

(Source)

That represents a more than 63% decline in just a month. Assuming that Iran trades its oil in dollars, this will not necessarily cripple its economy, but the specter of hyperinflation looms large whenever a currency falls by that much. With hyperinflation comes economic, social, and political instability, and these are, of course, precisely the aims of the US in imposing the sanctions.  And of course, everything that Iran imports will become hideously expensive -- quite rapidly.

The US is deliberately poking and prodding Iran right now. Given the glacial pace of nuclear development, we must ask ourselves, why now?

The Story

As with most things today, there is a story created for public consumption that justifies waging war against Iran. The main narrative goes something like this: Iran is trying to develop nuclear weapons, and this is intolerable, so it must be stopped.

In November 2011, the International Atomic Energy Agency (IAEA) issued a report, long denied under the prior director's tenure (Mohamed ElBaradei), finally declaring that Iran was unequivocally trying to build a nuclear weapon:

U.N. Agency Says Iran Data Points to A-Bomb Work

November 8, 2011

United Nations weapons inspectors have amassed a trove of new evidence that they say makes a “credible” case that “Iran has carried out activities relevant to the development of a nuclear device,” and that the project may still be under way.

The long-awaited report, released by the International Atomic Energy Agency on Tuesday, represents the strongest judgment the agency has issued in its decade-long struggle to pierce the secrecy surrounding the Iranian program. The findings, drawn from evidence of far greater scope and depth than the agency has previously made public, have already rekindled a debate among the Western allies and Israel about whether increased diplomatic pressure, sanctions, sabotage or military action could stop Iran’s program.

(Source)

I've not yet read the report, but I am concerned about the gap between the headlines I've seen that say Iran is building a nuclear bomb and carrying out "activities relevant to the development of a nuclear device."  For example, much has been recently made of the fact that Iran has enriched some uranium to the 20% grade, but there is a huge leap between that and the 90%+ grade needed for a nuclear device.  Iran had told the world it needed the 20% grade for a medical reactor, and then created a fuel rod for that reactor.  To say that enriching to the 20% grade is the same thing as trying to build a bomb is not accurate and possibly deceptive.

As a signatory to the Non-Proliferation of Nuclear Weapons (NPT) treaty, Iran has every legal right to enrich uranium for peaceful purposes, such as making nuclear fuel rods for a research reactor, and Iran is claiming that all their current work is towards this end.

Maybe it is; maybe not. But even if a nuclear bomb is being pursued, there's nothing in the NPT that provides for military action to pre-emptively prevent any nation-state from carrying out such development work. In fact, if a preemptive strike is carried out, it will be done without the benefit of any international laws or treaties that could justify the action. 

Also left out of the narrative is any explanation of why it was okay for Pakistan to develop nuclear weapons or why North Korea is permitted to hold them.

The simple answer is because they don't have any oil. A quick view of the US military presence surrounding Iran, coupled with the Iraqi experience of being attacked for supposed weapons of mass destruction that did not exist (nor were used by Iraq to threaten the US), reveals why Iran may be so motivated to develop a nuclear weapon:

If Iraq had a nuclear weapon in 2002, it is quite doubtful the US would have invaded -- a lesson that has not gone unnoticed.

While I am not a supporter of the current repressive theocratic regime in Iran, I strongly believe that it is up to the people of any nation to decide for themselves what sort of system they will choose to live under. The Arab Spring, as messy as it was, is vastly preferable to the blunt instrument of an externally driven war. 

The Curiosity

The most curious thing about this story is the apparent lack of awareness among US officials about how the oil markets work. I know they know better, but the context-free repetitions in articles such as this next one almost literally drive me crazy:

Geithner to Seek China’s Support on Iran

Jan 9, 2012

U.S. Treasury Secretary Timothy F. Geithner will urge Asia's two biggest economies to cut Iranian oil imports and seek to narrow differences with China on trade and currency disputes on a visit to Beijing and Tokyo this week.

(Source)

The idea that the world can just stop buying Iranian oil, as though it were the same thing as boycotting McDonald's and buying Burger King instead, is just ridiculous. The world oil markets are far too tight for that.

How is it that China is supposed to cut its Iranian oil imports, exactly?  Oil is a fungible product. If China cuts its oil imports from Iran, it will simply have to buy the missing amount of oil from someplace else. The 2.6 million barrels a day that Iran exports cannot simply be instantly replaced at this time from other spare capacity elsewhere in the world. It doesn't exist at the moment. Where will it come from?

Perhaps Geithner is offering something behind the scenes, like providing China with extra petroleum from the US strategic reserve while events unfold (unlikely). But barring that, it is a remarkably naïve request as it stands and is curious on its own.

The Powder Keg

With the Persian Gulf being so small, and so many tense parties crammed into that tiny arena, the chance of some sort of mischief arising is quite high. One twitchy trigger finger -- such as the one that caused the USS Vincennes, thinking it was under attack by a jet fighter in 1988 during the Iran-Iraq war, to shoot down an Iranian passenger airliner -- and the hounds of war may be let loose.

And it's not just the US. Practically everybody who's anybody has naval assets positioned for whatever may happen next:

Western forces react to Iran's Strait of Hormuz threat

Jan 9, 2012

TEHRAN, Jan. 9 (UPI) -- A buildup of Western naval forces in the Persian Gulf and Arabian Sea is a reaction to Iran's threat to close the Strait of Hormuz, military experts say.

U.S., Russian, French and British air and naval forces moved to the Syrian and Iranian coasts during the weekend, Israeli military intelligence Web site DEBKAfile reported Monday.

The Russian carrier Admiral Kuznetsov anchored earlier than planned at Syria's Tartus port on the Mediterranean Sunday, causing France to respond by consigning an air defense destroyer to the waters off Tartus, DEBKAfile reported. Canada also was sending a warship, the HMCS Charlottetown, to the Mediterranean where it would take over from the HMCS Vancouver.

Meanwhile, Britain has dispatched a missile destroyer to the Sea of Oman, due to arrive at the same time as the French Charles de Gaulle aircraft carrier.

And the U.S aircraft carrier John C. Stennis and its strike group are cruising in the Sea of Oman at the entrance to the Strait of Hormuz after Tehran announced it would not be allowed to cross through.

(Source)

With all those boats chugging around in those little bathtubs, and with various other forces that would definitely like to see a shooting war develop (a false flag attack is an option here), the risk is quite high of some form of incident that would trigger hostilities.

Of course, there are those in the war rooms of the various OECD countries who think they have a plan for the conduct of that war, but no plan ever survives first contact with the enemy. The one thing we can count on is the war being messier, longer, and more expensive by at least a factor of two than whatever is currently occupying the minds of the war planners.

Iran's Responses

Of course, Iran has been none too happy over the years at being surrounded, poked, prodded, and now finally sanctioned for having done nothing more than cloak its nuclear program in the exact same sort of secrecy that has surrounded literally every other nation's nuclear programs, including Israel and Pakistan, Iran's notable nuclear neighbors.

And now, with the aid of enhanced missile technology obtained from China and Russia, Iran has a credible threat to make:

Iran Has Ability to Block Strait of Hormuz, U.S. General Dempsey Tells CBS

Jan 9, 2012

Iran has the ability to block the Strait of Hormuz “for a period of time,” and the U.S. would take action to reopen it, Joint Chiefs of Staff chairman General Martin Dempsey said.

“They’ve invested in capabilities that could, in fact, for a period of time block the Strait of Hormuz,” Dempsey said in an interview aired yesterday on the CBS “Face the Nation” program. “We’ve invested in capabilities to ensure that if that happens, we can defeat that.”

Should Iran try to close Hormuz, the U.S. “would take action and reopen” the waterway, said Dempsey, President Barack Obama’s top military adviser.

(Source)

The admission here by the US military is that Iran has the ability to block the Strait of Hormuz "for a period of time," which they do, is an extraordinary admission (even if it really is stating the obvious) by the US brass.

Anti-ship missile technology has come a long way, and an offensive missile is much cheaper than either a large ship or defensive measures. The Falklands war in the early 1980s taught me that the navy is an outmoded concept if the opponent is armed with semi-decent anti-ship missiles, and such devices have improved remarkably since then.

During the most recent Iranian war exercises, the Iranian military test-fired (more of a demonstration, really) their Qader anti-ship cruise missile, which has a range of 200 km and can be fired from a small truck. To visualize the difficulty of defending against such a technology, just imagine how many hiding places for a small truck might exist within this 200 km radius green circle :

In order to neutralize the entire missile, full air superiority would have to be established and every mobile launcher found and destroyed. 

Further, Iran has a number of submarines capable of firing a new breed of torpedo that can achieve speeds in excess of 200 knots. As far as I know, these are extraordinarily difficult to defend against, let alone evade. 

Of course, China is paying close attention to the developments:

Iranian authorities reiterate threats to close Hormuz Strait if sanctions imposed on oil exports

Jan 8, 2012

TEHRAN, Jan. 8 (Xinhua) -- Iranian authorities reiterated threats to close Strait of Hormuz if Western countries impose sanctions on Iran's oil exports, local media reported Sunday.

(Source)



Conclusion

Once again, regrettably and mysteriously, we find the developed world in lock-step in its eagerness to attack Iran. "Regrettably," because Iran has not threatened any other country, and war should never be used simply because the current art of diplomacy is inadequate. "Mysteriously," because this is a particularly horrible economic moment to go about risking much higher oil prices. 

While we judge the risks of a war, either precipitated by legitimate escalation of frictions or by illegitimate actors seeking to cause the same, to be very high, it is our view that such a war will not go according to plan.  Iran has many more powerful allies, namely Russia and China, than did the extraordinarily isolated Iraq at the beginning of the Iraq war. 

Is it too waggish to suspect that certain Western political powers would love to be able to both divert attention from the crumbling economy and have a scapegoat upon which to blame the next leg of the financial downturn? 

Regardless of such speculation, the risk to each of us and the economy in general from an attack on Iran that closes the Strait of Hormuz is large enough to warrant your attention. Should oil spike in price, you can practically set an egg timer for the beginning of the next leg of the financial downturn.

In Part II: Are You Prepared for $200 Oil?, we explore what likely havoc the high oil prices from a major conflict with Iran will wreak on the financial markets and our petroleum-dependent lifestyle. We also detail specific steps prudent individuals should be taking right now, in advance of such a crisis, to position themselves defensively.

Click here to access Part II of this report (free executive summary, enrollment required for full access). 

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66 Comments

JAG's picture
JAG
Status: Diamond Member (Offline)
Joined: Oct 26 2008
Posts: 2492
Buy The Rumor, Sell The News

Wouldn't one think that this 2 year-old threat to the supply of oil is already somewhat figured in to the current price of oil? I mean, the big players in the market are always better informed than the media. How does one really expect to beat Wall Street at its own game? 

Does Part 2 say buy a 2012 Toyota Prius Plug-in, Nissan Leaf, or Chevy Volt?

saxplayer00o1's picture
saxplayer00o1
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Posts: 3625
Iran car explosion kills nuclear scientist in Tehran

Iran car explosion kills nuclear scientist in Tehran

dmger14's picture
dmger14
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Joined: Dec 7 2011
Posts: 82
I now have even

I now have even more respect for the Israelis than I did before.  With all the recent 'accidental' explosions of nuclear facilities and now the death of a nuclear scientist, I am in awe.  In all seriousness, we need some of that doo-dadinal fortitude here in the states.

Farmer Brown's picture
Farmer Brown
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Posts: 1503
I'll shoot the sherif!

Someone please explain one thing to me: the nation wih the most to lose by closing the SOH appears to be none other than Iran itself. Therefore, how do they make this threat? This reminds me of the scene out of Blazing Saddles, where the Sherif takes himself hostage, though it certainly is no laughing matter. 

Saudi Arabia can still ship through their Red Sea coast, and Kuwait and Iraq have pipelines out through Turkey, do they not?  

I totally agree the writing is on the wall and war is coming. It also appears both sides want it. Threatening to do things that hurt you more than anyone else, adds to my belief that storylines are manufactured to justify war to the masses, on both sides, no matter how illogical.  Meanwhile, the US has an incumbent Presidential election coming up, so a war is practicaly a given.

Poet's picture
Poet
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Posts: 1875
Nice Article

I think there is a convergence of interests here. We have the Saudis and other regional powers who don't want Iran to have nuclear weapons nor gain even more ascendancy.

The United States and Europe could certainly use some heightened sense of global danger - or even some skirmishes or conflicts - to distract attention from flailing domestic economic performance.

Iran desperately needs nuclear weapons due to perceived threats and American military forces all around - and is actively working on them, even if they profess not to be.

Russia and China have their own agendas...

Whether we will have outright military-to-military war or not this year, is still uncertain. But definitely the volatility will make the markets' trading desks and algorithm snakehandlers happy.

Poet

tictac1's picture
tictac1
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Posts: 175
Excellent, Chris!

For Farmer-

Iran's threat makes sense in that they know for a fact that Iran cannot sustain a full-blown war against the U.S.  It's a suicidal threat, which means they too feel an attack is eminent, and are desperately in "deterrence" mode.  Suspects do this with police, too.  As a last ditch effeort, they hold the gun to their own head.

For the guy who praises Israel's extra-judicial killings, where do you draw the line?  Is it OK to kill an American because they might be a threat?  Is it OK to kill your neighbor because he might want to rob or hurt you sometime in the future?

"It is strangely absurd to suppose that a million of human beings, collected together, are not under the same moral laws which bind each of them separately"  -Thomas Jefferson

eugene12's picture
eugene12
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Posts: 3
Iran

Outside the US, few believe any of the nuclear weapons hype.  Simply no proof.   It's the Iraq routine rerun.  This is about domination, oil, Iran standing up to us, American presence in Central Asia and keeping the American war machine funded.  The rest of the world knows what is going on. But they have to be careful dealing with an angry, violent nation with as hair trigger.  And it is election year.  Wars are always popular with us. 

And it is a nice diversion for Americans.  We get to watch fabricated media film of our "accurate" weapons, eagerly send our young (below a certain economic line) off to war, be patriotic, feel powerful again and all the other excitement with the circus.  Enjoy!!

Damnthematrix's picture
Damnthematrix
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Posts: 3998
"Perceived threat"?

Poet wrote:

Iran desperately needs nuclear weapons due to perceived threats and American military forces all around - and is actively working on them, even if they profess not to be.

"Perceived threat"?  Are you kidding...?  Did you miss that map Chris posted above with all the US flags...?

I'd be downright paranoid if I was Iranian......

Mike

Damnthematrix's picture
Damnthematrix
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It's the Iraq routine rerun.

eugene12 wrote:

Outside the US, few believe any of the nuclear weapons hype.  Simply no proof.   It's the Iraq routine rerun.  This is about domination, oil, Iran standing up to us, American presence in Central Asia and keeping the American war machine funded.

It may also have a lot to do with the fact Iran has already started selling oil in its own currency instead of US$.  Remember when Saddam Hussein was threatening to sell oil in Euros?

So now almost none of Iran’s oil will be traded in Dollars.

India and Japan have also recently agreed a 15 billion dollar currency exchange. This will tie their two currencies closer together.

The list of countries and trades no longer using the dollar for settlement for their trade is now considerable. How close are we to reaching the tipping-point where it no longer makes sense for nations to use dollars and makes more sense for them, both economically and politically, to use the network of currencies tied to the Yuan? When we reach that point the Yuan becomes in reserve currency in all but name.

China, India, Russia and Iran are all large holders of physical gold and most of them are also large producers of it. None of them are firm allies of the US. They all have long term relations with each other. All of them have expressed oncercern over US debts and printing. None of them will like QE3, nor Euro printing, when they both arrive later this year.

Mike

dbworld's picture
dbworld
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Posts: 9
Selling Oil in Euros?

I didn't have time to read the article, but isn't the banking sanctions a means to stop the oil in euros sales that Iran started late last year?  Just like Iraq, isn't that what is driving our agressive response?

rwcarr's picture
rwcarr
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Posts: 2
paranoid over treasury auction failure

I think that Timmy went to China not to instruct them about Iranian oil, but to influence them to continue to purchase American Debt. I am of the opinion that Iran must hit America in their pocket like he is experiencing in their country. Because China relies on Iranian Oil, a deal could be struck between Iran and China not to purchase any more of our debt and hit us where it would hurt the most

tailwind13's picture
tailwind13
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Posts: 2
Is Iran Really the Target?

Chris,

I suspect that there is more than meets the eye here if you peel the onion a bit. Back in the '80's I flew hundreds of hours of I/S/R in this area to support the Battle Groups there and NOTHING is as it 'appears'. Could there be a war? Sure...but just as likely an answer is the operations off Iran's southern coast are as much about keeping their heads down as anything. I suspect Syria is the real target and since Iran is a sponsor, we do not want them to get any funny ideas about helping out there. Having said that, if the Western world continues to back Iran into a corner with sanctions, at some point, they may just come out swinging. I know I would.

Peter Smith's picture
Peter Smith
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Posts: 32
Iran

"Iran has not threatened any other country"  Chris, I don't have the quotes or references handy but you know yourself that Iran has repeatedly threatened Israel with not only attack but extinction should Iran obtain the means.  Further, the capabilities of the "flags" you show all around Iran are misleading.  These "bases"  have extremely limited capabilities for any substantial offensive action.  You ignore the broad and historic geo-political struggle going on the the Middle East.  Iran is seeking to fill the vacum created by the removal of the Iraqi military as a counterwieght to historic Iranian /Persian desires to dominate the area.  I don't disagree with most of your analysis but find in narrowly focused and incomplete.

ccpetersmd's picture
ccpetersmd
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Posts: 799
Great Article, and Fits Nicely with some Emails I Received...

The following two pieces of text are excerpts from an email from another economic adviser I respect. There are a few typos present, but remember that these were just emails, not summaries planned for a wide audience. Still, I believe the issues raised are important enough to pass along to a wider audience, particularly given the fact that these events are receiving little attention in the U.S. media. No sources are provided, and I'm honoring the wishes of the author to remain anonymous. I have checked a few of the events noted, and those have been verified.

Subject: Tracking Iran

Date: Thu, 5 Jan 2012 11:04:44 -0500

Tensions continue spiraling higher and higher in the Persian Gulf, threatening to go lethal.  Obama has certainly gone on a very aggressive offensive against the Iranians, which they have responded to with ever more desperate belligerence.

Review a brief timeline of recent events:

- Over the last several months, the covert offensive war against the Iranians has gone into overdrive, with the systematic assassination of top Iranian nuclear scientists, usually by blowing up their cars en route to work.  The covert actions ratcheted up with the targeting of Iranian computer systems with the Stuxnet virus, seen by many, and especially the Iranians, as blatant acts of cyber-warfare.

- On November 12 the rush towards war reached a new level, when a massive explosive devastated a missile-testing site near Tehran, killing scores of Iranian military, including a top general, and wiping out the site entirely.

- On November 29, in response to the escalating covert operations, Iranian Revolutionary student brigades stormed and ransacked the UK embassy in Tehran , forcing the precipitous withdrawal of British personnel and the expulsion of all Iranian diplomats from London.  International schools closed throughout Iran as foreigners began a mass exodus out of the country.

- On December 2, the next "spontaneous explosion" occurred at a second nuclear site, which likewise killed many Iranians and caused much consternation.

- On December 4, the Iranians shot down a US spy plane over eastern Iran, which the Americans said was a CIA drone and acknowledge is missing. They subsequently paraded it on national TV.  The Iranians further let it be known that they would fire "150,000 rockets" at Israel in the event of an Israeli airstrike and would choke off the Strait of Hormuz.

- On December 5, ratcheting up regional pressure, Prime Turki al-Faisal declared that Saudi Arabia had no option but to develop its own nuclear arsenal if faced with a nuclear Iran.  Erdogan, the Turkish Prime Minister, quickly agreed that if Iran has a nuclear weapons, Turkey must also have nuclear weapons.

- On December 6,  the Iranian Revolutionary Guards raised the operational readiness status of the country's forces, initiating preparations for potential external strikes and covert attacks.  The UK Daily Telegraph explained: "The regime fears it will be the target of a surprise military strike by Israel or the US."

- On December 13, riding high from the capture of the US stealth drone, the Iranians announced plans to conduct a "practice" closure of the Straits of Hormuz, the most important and narrowest channel for seaborne oil exports in the world.  Parviz Sorouri, a member of the Iranian National Security Committee, said the purpose of the drill was to demonstrate that: "Iran will make the world unsafe if the world attacks Iran."

- On December 16, President Obama met with Israeli Defense Secretary Barak at the White House, which occurred simultaneously with US Defesnse Secretary Panetta's meeting with Turkish leaders in Ankara.  (The night before, Turkish military council met urgently to review preparations for a two front war against Syria and Iran.)

- On December 19, Panetta, in a radical reversal of Obama Administration policy, announced that Iran needs less than a year to build a nuclear weapon, perhaps significantly less, "if they have a secret facility somewhere in Iran enriching fuel."  Previously, the Obama Administration always cited intelligence estimates that concluded Iran was three to five years away from developing a nuclear weapon.  Panetta's reference to "a hidden facility somewhere in Iran that may be enriching fuel" reflects a hard move towards the Israelis, who have long and loud maintained exactly this.

- On December 20, Joint Chiefs of Staff Chairman General Martin Dempsey made bellicose comments on CNN, bluntly warning the Iranians against "miscalculating our resolve."  Dempsey is generally understood to be charged with planning the US military attack on Iran.  "We are examining a range of options," he told CNN.  "Don't push it," he told Iran.  Thus the United States two top military figures warned bluntly of military action against Iran in a two-day period.

- On December 24, the Iranians announced they would commence 10 days of war games to demonstrate how easy it would be to close to the Strait of Hormuz.  "Iran will make the world unsafe if the world attacks Iran."  Closing the Strait, the Iranian Navy Commander Moussavi boasted, would be "as easy as drinking a glass of water."

- On December 30, the Pentagon reiterated its position that "any disruption [in the Strait of Hormuz] will not be tolerated."  To prove its point, the USS Stennis aircraft carrier sailed through the Strait to the Gulf of Oman with only a single destroyer, demonstrating US control.

- On December 31, the Iranians proved this when they did close the Strait of Hormuz for five hours.  Iranian media reported that long- and medium-range missiles would be fired in the Strait as part of its ongoing naval drill. Thus for five hours on December 31, not a single ship, military or commercial, ventured into the 30-mile strait.  Moussavi then announced that no missiles had been fired at all.  It was a trick to demonstrate how easily Iran could in fact close the Strait of Hormuz.  Now the USS Stennis, based at the Fifth Fleet's home in Bahrain, was stuck in the Sea of Oman.

- In the evening of December 31, Obama signed into law the most stringent and draconian sanctions yet imposed on Iran.  The new law penalizes any foreign financial institution dealing with the Iranian central bank, which in effect could have devastating financial consequences.  In effect, the law forces countries to choose between buying oil from Iran or having any dealings with US financial institutions The Iranians had warned that they would deem the signing of this statute an act of war and would respond with drastic steps, including the closure of the Strait of Hormuz.  President Ahmadinejad told parliament that these sanctions are "the most extensive sanctions ever" and that "this is the heaviest economic onslaught in the history of the nation. . . every day, all our banking and trade activities and our agreements are being monitored and blocked."  The price of food staples in Iran has soared 40% in the past two months, according to Reuters.

- On January 2, the Iranians did in fact fire multiple missiles in the Strait, again closing it to all traffic for much of the day.  The Iranians showcased the Qader shore-to-sea cruise missile, described as a missile capable of destroying large aircraft carriers with a single hit.  (The USS Stennis cost $4.5 billion to construct in 1995; a replacement would cost an estimated $8-10 billion.)

- On January 3, in another heated escalation, the Iranians warned the United States that the "enemy carrier" (the USS Stennis aircraft carrier) would not be allowed to "return to the Gulf."  Army Chief of Staff Salehi said: "Iran will not repeat this warning."  Thus the USS Stennis, which travered the Strait of Hormuz just four days earlier in a show of US force, effectively became stuck in the Gulf of Oman.  By posting a 'Keep Out' sign over the Persian Gulf for the USS Stennis, the Iranians are goading the Obama Administration to act sooner rather than later.

- On January 4, in a bold and highly provocative step, the EU announced it had agreed in principle to impose an embargo on all Iranian oil.  This will further tighten the noose on Iranian economic activity, which is almost entirely dependent on foreign oil sales.

- On January 4, the Iranian parliament rushed out a bill to prohibit any foreign warship from entering the Persian Gulf through the Strait of Hormuz without Iranian permission.

- This morning, January 5, the militaries of Saudi Arabia and the Gulf Coorperation Council (the Sunni Arab monarchies) went on full war alert for an early US-Iran clash.

The Obama Administration drive to keep piling on the pressure, sending the Iranian economic and financial systems ever deeper in chaos and driving the Iranian ruling elite into ever greater states of desperation, has brought a US-Iranian military clash dangerously close.  The cornered Iranians, who feels plunged in an existential struggle, are ratcheting up their belligerence day after day.  

Something is poised to snap.

Subject: Warships mass off Syria and Iran, US deploys 9,000 troops to Israel, as "Iranians prepare for war"

Date: Mon, 9 Jan 2012 11:11:09 -0500

The Middle East continues to brace for a regional war, with armed tensions multiplying daily.

(1) The Pentagon has deployed some 9,000 US soldiers to Israel over the last week or so and the rush is on to establish American command posts in Israel and an Israeli military command post at EUCOM headquarters in Germany. This is unprecedented. The United States has never massed troops inside Israel before, despite decades of close military co-opreation and trillions of dollars worth of military equipment and funding (in real terms). US soldiers based attacking from Israel are meaningless against Iran, but not against the Shiite minority ruling elite in Syria. (Ostensibly the US soldiers arrived for "training and war games.")

(2) US, Russian, French and British warships all have massed off the Syrian and Iranian coasts over the weekend. The Russian aircraft carrier Admiral Kuznetsov anchored at Syria's Tartus port in the Mediterranean yesterday, arriving with a destroyer and a frigate. The Russian naval battle group arrived with great fanfare. The Russians received the Syrian naval commander Dawoud Rajha on deck with an honor guard and the flyover of Russian Su-33 and Su-25 fighter-bombers in a clear signal of Putin's willingness to back Assad and the minority Shiites (and Iran) against any Western invasion. France sent a air defense destroyer to the waters off Tartus. At the same time, a dramatic build-up in air and naval power has occurred over the last forty-eight hours opposite Iran in the Persian Gulf and Arabian Sea in readiness for the Iranians to carry out their threat to close the Strait of Hormuz. The UK dispatched the HMS Darling, a Type 45 destroyer armed with new anti-missile technology to the Sea of Oman. France sent the Charles de Gaulle aircraft carrier. The giant RQ-4 Global Hawk UAV took off from the USS Stennis (the US aircraft carrier) to conduct surveillance along the coast of Iran, but the Stennis and its battle group remain in the Sea of Oman following Iran's command not to re-enter the Strait.

(3) Both Defense Secretary Panetta and General Dempsey, chair of the US Chiefs of Staff, went on US television yesterday to warn that the Iranians could close the Strait of Hormuz "for a period of time" but "if that happens, we can defeat that." Dempsey reiterated: "Yes, they can block it. We've described that as an intolerable act and its not just intolerable for us, it's intolerable for the world. But we would take action and reopen the straits." Panetta likewise warned of a quick, tough and decisive American military response to any Iranian attempt to close the Strait.

They both spoke a few hours after a spokesman for the Revolutionary Guards said the Supreme Iranian Council had ruled the Strait of Hormuz must be closed in the event of an oil embargo imposed by Iran on the European Union.

(4) The Iranians announced plans to start near-weapons grade enrichment of uranium at a deep underground bunker near Qom (one of the holiest shrine cities of the Shia), something that the Israelis and Americans have described as a "red line" many, many times in the past. According to the Financial Times, the start of enrichment there is "a point of no return for Iran's nuclear program."

In an English release, the Iranians said it would become operational soon. In a Farsi release, they said it was already operational. Davani, the head of Iran's Atomic Energy Organization, raised tensions further by saying "The Islamic Republic is capable of exporting services related to nuclear energy to other countries."

(5) The Iranians, in a clear move to infuriate the Americans, sentenced to death a US Marine (born in Arizona and now a resident of Michigan, although he has worked extensively in the Middle East and Afghanistan for the past number of years) they arrested last month as a CIA spy. He confessed to being a spy for the CIA on Iranian state television in late December (obviously under duress). He claims he was just a tourist visiting extended family. The CIA declined to comment.

(6) The Supreme Ayatollah Ali Khameni gave a fiercely defiant speech today, declaring Iran would never yield to Western sanctions and would never change its nuclear course. "The Iranian nation believes in their rulers. Sanctions imposed by our enemies will not have any impact on our nation. Sanctions will not change our nation's determination."

(7) In an excellent article, "Iranians Brace for War," the Washington Post reports that "the mood here [in Tehran] has turned bleak and belligerent as Iranians prepare grimly for a period of prolonged hardship and, they fear, war. This stark contrast has been evident this week as a top military commander declared a 'critical point' in the country's long fued with the West and ordinary Iranians stocked up on essential supplies. 'I will tell you what this is leading to, war,' said a merchant in Tehran's popular Paytakht bazaar who gave his name only as Milad. 'My family, friends and I are all desperate.'

It all feels like its moving very quickly in the wrong direction. It is clear at least some of the Iranians -- including Khameni and Ahhmadinejad -- want a conflict, at least a limited conflict. It's less clear why or what they think they can gain from it.

Putin obviously would relish a conflct because it would leave the Russians as the last oil exporters standing. They stand to make windfall profits from it.

All in all a very dynamic and dangerous situation, one which seems to receive startlingly little attention in the US media.

 
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Peter Smith wrote: "Iran has

Peter Smith wrote:

"Iran has not threatened any other country"  Chris, I don't have the quotes or references handy but you know yourself that Iran has repeatedly threatened Israel with not only attack but extinction should Iran obtain the means.  Further, the capabilities of the "flags" you show all around Iran are misleading.  These "bases"  have extremely limited capabilities for any substantial offensive action.  You ignore the broad and historic geo-political struggle going on the the Middle East.  Iran is seeking to fill the vacum created by the removal of the Iraqi military as a counterwieght to historic Iranian /Persian desires to dominate the area.  I don't disagree with most of your analysis but find in narrowly focused and incomplete.

Hmmm....  wiping ot Israel is just wishful thinking methinks.... they must know it would start their own destruction, another MAD situation.

As far as the US bases go, if all they can do is guide attacks and detect Iranian missile attacks, isn't that enough to up the ante as far as Iran's concerned?

And once upon a time, before the British and the Turks came along, Persia looked like this:

Persian Empire Map

You can call Iran's ambitions "desires to dominate the area", but historically it was all theirs to start with......

Mike

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“Are they trying to develop a nuclear weapon? No.”

War Plan Iran: The US Finally Admits Its Criminal Bankruptcy.

“Are they trying to develop a nuclear weapon? No.”

Officially, America is now bankrupt: financially, economically, politically – and morally. Its criminal aggression towards Iran is just one of many parts of a jigsaw that add up to a clear and grotesque picture of what the United States of America now represents in the 21st Century world.

The numbers and pictures for these constituent parts of this odious jigsaw puzzle are well known. But what has become glaringly clear is just how integrated the official image of the US now is. Bankrupt.

Terminally in debt, mass poverty at record levels, rampant militarism, draconian curbs on civil liberties, government by the rich for the rich, and lately the reactionary, debased cat-fight that passes for political debate among Republican contenders for the Presidency. Cringing is the sight of super wealthy career politicians throwing sand in each other’s eyes to scrabble up the pole for yet further personal accumulation of capital; disturbing is the easy way that psychopathic targeting of imagined enemies whether at home or abroad is worn like a badge of honour. It is a sign of how depraved the American political mind has become when would-be presidents can so openly talk of conducting foreign policy in terms of unquestioned international aggression.

Of course, this kind of political and moral bankruptcy is not just confined to those seeking office. It is the coin of those who are already in office.

In a report in the New York Times Monday we have the startling admissions that, taken together, show that the US government should be certified as criminal (if further proof were needed) [1].

First we have the top US military man confirming that long-averred war plans against Iran are indeed going ahead.

The NYT: “When asked on [CBS’s] Face the Nation about the how difficult it would be to take out Iran’s nuclear ability in a military strike, Gen. Martin Dempsey, the chairman of the Joint Chiefs of Staff, said: ‘Well, I would rather not discuss the degree of difficulty and in any way encourage them to read anything into that. But I will say that my responsibility is to encourage the right degree of planning, to understand the risks associated with any kind of military option, in some cases to position assets, to provide those options in a timely fashion. And all those activities are going on.’” [Emphasis added]

In other words, the US is preparing for war.

Ironically, in the above lengthy article about the imminent opening of Iran’s second uranium enrichment plant at Qom, located under a mountain and impregnable from attack, the New York Times buries General Dempsey’s admission deep within the folds of its paragraphs perhaps in a bid to make it impregnable from attack by sane readers. Granted, the bellicose talk from US Commander-in-Chief Barack Obama and his administration of all options on the table has become so routine that the editors at the NYT have probably become inured to criminal admissions and so don’t think them worth any higher prominence that a final paragraph.

But here is the second part of the equation that adds up to definite criminality.

In the same story, the New York Times quotes US Defence Secretary Leon Panetta making what should be a startling admission: that Iran does not have a nuclear weapons.

Panetta says: “Are they [Iran] trying to develop a nuclear weapon? No.”

That Panetta finally admits what many people around the world know to be true, including American intelligence agencies in at least two US National Intelligence Estimates in 2007 and 2010 – that is, that Iran is not attempting to develop a nuclear weapon, should be a front-page headline. Especially when taken together with the US General Dempsey’s disclosure that war plans are afoot. From its own admission, therefore, the US government is pushing the world into possibly a World War III scenario on the basis of a totally spurious claim that even its own top brass do not believe.

Reflecting the bankruptcy that has corroded the US political establishment is the way that the New York Times – America’s self-styled premier newspaper – glides over these nuggets of self-indictment as if they were worthless banalities.

So if Iran is not even trying to develop a nuclear weapon, as Panetta now admits, what then is the criminal US warmongering predicated on? Unofficially, the real reason is imperialist rivalry with other powers (Russian and China in particular) in the energy-rich Persian Gulf and Central Asia regions, and the attempt to engineer “regime change” in Iran to one that is pliant with Washington’s geopolitical designs.

Officially, for what it is worth, it seems now that the US is not happy even with the mere suspicion that Iran maybe, just maybe, one day capable of developing nuclear capability.

This is where facts can be helpful. As a signatory to the Nuclear Non-Proliferation Treaty, Iran has the legal right to develop nuclear capability for civilian purposes. This is what Iran has consistently said it is doing and what countless UN inspections of facilities over many years, including the new plant at Qom, have verified. The enrichment of uranium constitutes “nuclear capability” and is an essential part of harnessing nuclear energy for civilian energy. Iran should be congratulated for this achievement given years of gratuitous sanctions by the US its Western allies.

But the way the US government and its Western allies put it, Iran’s legitimate nuclear capability is made to sound like a diabolical threat.

Panetta again: “But we know that they’re trying to develop a nuclear capability. And that’s what concerns us.”

There you have it. The United States can drop nuclear weapons on civilians, possess up to 10,000 nuclear warheads, supply its allies illegally with such weapons and continue to violate the purpose of the NPT by not disarming its nuclear arsenal – yet if a country uses the provisions of the NPT legitimately to pursue nuclear capability then it is reviled and made a target for an illegal war of aggression, most probably with nuclear weapons.

This is depravity-turned-foreign policy – emanating from supposedly the most democratic government in the world.

In that way, the unseemly Republican Party cat-fight between Romney et al is but a symptom of the chronically bankrupt body politic that is American government in the 21st Century.

Finian Cunningham is Global Research’s Middle East and East Africa correspondent

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Well done Mike!

I too was going to bring up the quote by Panetta about KNOWING that Iran was not trying to develop nuclear weapons,and considering the brainwashed naivete of Peter Smith above,it's very important that these fact are addressed.

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The Israelis Are Going To Do It

I don't think we are preparing for war; we are preparing to keep the SOH open and preparing to assist in the protection of Israel after they launch a strike on Iran.  Here is my reasoning:

Israel sees an Iranian nuke as an existential threat.  They have sent a million signals about how they won't allow this threat to develop fully.  You can agree or disagree, but that is what they believe.  Israel is GOING TO STRIKE IRAN.   I think the past bad blood between Netanyahu and Obama are the result of Netanyahu telling Obama that they are going to strike.  Obama doesn't like it, but its going to happen.  He can play along or not, but his electability depends on his response.  Netanyahu doesn't give a shit what Obama thinks.

The US is now preparing for the ramifications of this action by Israel, and helping lay the ground work for deniability.  Why the rush to pull out of Iraq?  What about the destabilization of Syria?  There is no way to fly Israeli aircraft to Iran without flying through Syria and Iraq.  The delay has been about clearing those air corridors so as to allow the Israelis to fly and maintain US deniability.  The Iraqis can't control their own airspace, and the Syrians will be destabilized around the time of the strike.  Watch for action in Syria next.

Once the shooting starts, the US must do two things:  Keep the SOH open, and keep Israel from getting smoked by missle launches.  Thus the naval buildup and the deployment of the anti-missile forces into Israel for the first time.  

On the plus side for the Obama regime, he can blame the crappy economy on the subsequent price spike in oil, and wrap himself in the flag during the war, and recapture the Jewish vote in the US by "defending" Israel.  Win-Win-Win.

All the pieces are on the board and in position.  Shooting will start soon.  The collapse will be hastened.  

Rector 

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Ahmadinejad has often threatened Israel

Saying Iran has never threatened any country is wrong. Ahmadinejad has led chants of death to Israel and repeatedly threatened to wipe them off the map. In televised speeches he says the countdown to the end of the people of Zion has begun.

The rest of the article is spot on.

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The Israelis Are Going To Do It

Rector wrote:

I don't think we are preparing for war; we are preparing to keep the SOH open and preparing to assist in the protection of Israel after they launch a strike on Iran.  Here is my reasoning:

Israel is GOING TO STRIKE IRAN. 

IF you are right......  you sure know how to pick the wrong side!

IF I were Obama, and IF I knew Netanyahu doesn't give a shit, I would give him an ultimatum:  Strike Iran, or even just attempt to, and we switch sides.

Simple.

If Israel strikes Iran, you lot can kiss your oil supplies goodbye.  FOREVER!  IF you support them...... all hell will break loose, and I don't see in whose advantage this whole mess would end.  The repercussions would be breathtaking....

Mike

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The geo-political interests are driving the economic

Poet, thanks for expanding the discussion.

I can't think of anyone in the region that would welcome a nuclear Iran.  It is surprising that Chris does not focus more on Israel in this dynamic and how Israeli interests are magnified by American politics, especially in an election year.  Also, I think the US and Europe are not just looking at oil, but also volatility.  A nuclear Pakistan is a huge regret for the West but also Russia and Central Asia.

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Americans are tired of war

I don't think the American public is itching for another war just yet.  We need at least 18 months for the bitter taste of Iraq to fade.  Plus, we have to somehow announce a victory in Afganistan despite Karzai.    

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just a hunch

I think Israel is sitting on it's own oil and will surprise  Iran and China  when they have run out of oil .

FM

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Where did you get that idea from?

Full Moon wrote:

I think Israel is sitting on it's own oil and will surprise  Iran and China  when they have run out of oil .

FM

I think THAT would surprise a whole lot more people than the Iranians and Chinese.....!  Where did you get that idea from?

Mike

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The new Seaway pipeline

Here's one more reason why America may not care so much about what happens in Iran in the short term:

WTI edging on Brent Crude Oil?

Quote:

Lately the price of WTI crude oil has been catching up on the price of Brent crude oil thanks to a new Seaway pipeline, moving oil from Cushing to Gulf coast refineries as early as April 2012, at the rate of 400,000 barrels per day. This new pipeline will help reduce the US dependency on oil from the Middle East.

Oh no... unless the Canadian housing market collapses just in time and brings down Alberta with it

Samuel

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Iran: Oh, No: Not Again

CMartenson,

I think your article is very thoughtful and well written. And I don't war any more than you do. I am not a war monger and the Media-Military-Industrial-Complex in the US literally troubles the heck out of me. I think they're out of control actually.

But as I've pondered the issue of war with Iran I've not been able to get across the following questions:

1. You claim that the U.S. has already committed acts of war against Iran. Do you not know that Iran has already committed acts of war against the U.S.? Do you not consider the guerilla war they are funding and making weapons for - that have killed thousands of U.S. soldiers - "acts of war"?

2.  You suggest that the U.S. government may not understand the oil markets (or, at the very least, if they do they are picking the wrong time economically to target Iran). You further argue that the international oil markets would suffer greatly with a war. I couldn't agree more.

But what price do you think oil would be trading at if Iran was the only oil producing nation in the middle east that did have a nuclear weapon?

3. Putting war propoganda aside, it's clear that Iran has hegemonic ambitions. They've stated as much publicly. Clearly that makes them different from Pakistan which you also cite in your article. Pakistan's primary concern obviously is a balance-of-power relationship against India, etc. But Iran believes their culture is and has long been (since before Darius the Great, Xeres, etc) culturally superior to their neighbors.

How do you think a country that has publicly declared their hegemonic ambitions will treat their neighbors if they have a nuclear gun pointed at the head of their neighbors?

4. Dominance in the Middle East has long been a struggle between Iran and Saudi Arabia. For the last century both countries have been propping up client states in the region and trying to exercise hegemonic dominance.

Every time Saudi Arabia and its client states work with the Western countries Iran uses that as a PR recruiting tool to remind their client states that Saudi Arabia is selling out.

If Iran had nuclear weapons how do you think that would change the balance of power with Saudi Arabia? Do you think that could limit Saudi Arabia's relationships with their client states?

5. If Iran had nuclear weapons, who do you think would be next in line to get them?

6. Do you think Theocracies with nuclear weapons act differently than secular nations with nuclear weapons?

7. We almost lost 5,000 people in the Iraq war and believe me I know from personal experience the pain of a loss in war.

And at $700 Billion the cost of the Iraq war was indeed large. $100 billion a year is big bucks no matter how you look at it.

But folks who understand markets know that $100 billion a year given our $15 trillion economy (+ another $15 trillion in Asia + another $15 trillion in Europe) makes the $100 billion investment to secure commerce between ourselves and our trading partners SMALL POTATOES.

Given almost $50 trillion in global commerce, do you think $100 billion year is a large "capital expenditure" to secure the single most important economic resource we have?

8. Personally, I agree 100% with your theory that every nation has a right to self-determination. Does that mean you would have allowed Cuba to become a nuclear power during the Kennedy administration?

10. You talk about the threat of an escalation that could lead to war given all the people in the region so angry with each other. What do you think an escalation would cost if these countries were armed with nuclear weapons?

I am not for war by any means. I'm really not. I just haven't been able to answer the above questions in a way that lets me argue against war with Iran. I've concluded that the only thing worse than war with Iran would be an Iran with nuclear weapons.

I look forward to your well-reasoned answers.

Sincerely,

Dylan Jovine

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Why Iran should not have nuclear weapons.

Ahmadinejad believes he personally has been chosen by Allah to hasten the return of the Muslim  messiah (12th Imam).   The way to achieve this goal for the Iranian president is the occurrence of a nuclear Holocaust.  And this is why it is so vital for Ahmadinejad that Iran acquire a nuclear weapon. 

Source:  " Bomb and the Koran"  by Michael Taubmann 

I think we should take this seriously from a guy who thinks the extermination of 6 million Jews in WWII was a myth.

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like I said hunch

Israel is surrounded by oil producing countries .    I can see them sitting on it and using up everyone elses and saving theirs for last .

FM 

Can not post where the hunch comes from on this site  

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Are you caught in the distraction? Iran Oil Bourse in Euro's

I see the Nuclear threat as an attempt to distract and not a real threat. (i.e. like Iraq WMDs)  WAR is a possibility, but mainly because USA can't gain control of Iran and Iran is opening up its Oil Bourse.

http://www.tehrantimes.com/economy-and-business/94459-iran-to-regularly-offer-crude-oil-on-bourse-next-year

But as I read the comments and this article, I can't help but think that everyone is being distracted by this article and not following what is the root cause and reasons for US aggression.

Am I alone in thinking this?

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Then I guess we had better be ready. . .

I see your point, but I cannot see the US suddenly switching sides to align ourselves with Iran, regardless of justification.  Like it or not, the US and Israel have a long history of mutual support, and the opposite is true of the US and Iran.  There would be serious domestic political consequences for such an ultimatum.

The leadership of Israel believes they could be targeted if Iran goes nuclear.  Given that perspective, the international ramifications of a preemptive strike are less signifcant.  The experience of WWII and the Holocaust are the lens by which the Israelis view existential threats.

I take the Iranian leadership at their word with regards to their feelings about the Israelis.  They are committed and vocal about their future ambitions.  This is well documented and not difficult to confirm.

If you think the threat is overblown, and Iran has only peaceful intentions for nuclear technology, then I can understand your anger.  However, many people in Israel in the United States and around the world are afraid of a nuclear Iran more than they are of the consequences of war.

The whole argument rests on three things:  Is Iran pursuing nuclear weapons?  What will they do with them if they get them?  What are the consequences of inaction?

Using the same philosophy of being prepared for the worse case scenario that we practice here at CM.com, it is not entirely irrational to prosecute a preemptive strike, as long as the consequences are less serious than a nuclear attack.

A complex situation to be sure.  Its not easy to know the right answer.  

Rector

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I agree

Its possible, however I think its something that may be discovered in the future, and hasn't been confirmed yet.  Hard to keep something like that a secret.  Plus, oil is fungible.   

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Getting tired of this............

The correct translation of what Ahmedinejad said is 'the regime should disappear from the pages of history',NOT that Isreal should be wiped off the map!I believe the more,shall we say,atomically aggressive,comment was an intentionally bad translation by the Isrealis in an attempt to do exactly what it has done.

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Oil spike for a pipeline

Just a thought. A friend of mine mentioned that an oil shock would be a great way to gain more support for the XL Keystone pipeline.

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Ruhh wrote: Just a thought.

Ruhh wrote:

Just a thought. A friend of mine mentioned that an oil shock would be a great way to gain more support for the XL Keystone pipeline.

I didn't understand why Obama opposed the pipeline. As you say, maybe we need a shock first. I personally am deadset against the Northern Gateway pipeline, for both environmental and strategic reasons. North America's oil should stay in North America. We shouldbe using it to build out a solar energy infrastructure, not sending it to Asia to burn in ICE's, never to be seen again. Plus, when global currencies collapse and the only thing of value is energy, food and to some extent minerals, then why would any country export oil? What is there of value that it could be traded for?

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WTI edging on Brent Crude

WTI edging on Brent Crude Oil?

Quote:

Lately the price of WTI crude oil has been catching up on the price of Brent crude oil thanks to a new Seaway pipeline, moving oil from Cushing to Gulf coast refineries as early as April 2012, at the rate of 400,000 barrels per day. This new pipeline will help reduce the US dependency on oil from the Middle East.

Whoever wrote this has no idea what they're talking about..........  The US consumes (without checking for EXACT figures) ~22Mbarrels/day, and only produces ~6Mbarrels/day.  So you import ~16Mbarrels/day......  which means piping 400,000 barrels is not going to make one iota of difference to your importation needs.

Mike

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Oil spike for a pipeline

Ruhh wrote:

Just a thought. A friend of mine mentioned that an oil shock would be a great way to gain more support for the XL Keystone pipeline.

When will people realise that Nth America is TOTALLY INCAPABLE of supporting its greedy oil needs regardless of how many bloody pipelines you build?

If a war stops all oil from the NE to flow, you can kiss your lifestyle goodbye....

Mike

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Are you caught in the distraction? Iran Oil Bourse in Euro's

dbworld wrote:

I see the Nuclear threat as an attempt to distract and not a real threat. (i.e. like Iraq WMDs)  WAR is a possibility, but mainly because USA can't gain control of Iran and Iran is opening up its Oil Bourse.

http://www.tehrantimes.com/economy-and-business/94459-iran-to-regularly-offer-crude-oil-on-bourse-next-year

But as I read the comments and this article, I can't help but think that everyone is being distracted by this article and not following what is the root cause and reasons for US aggression.

Am I alone in thinking this?

Not at all....  I've posted similar items here, and they've all been ignored.  The whole Nuclear Iran thing is a beat up.  So far, they've proudly produced ONE FUEL ROD.  And bomb material is 100 times harder to produce...

Iran needs nuclear energy because it damn well knows it's PEAK TIME...

Iran crude-oil extraction extrapolated to the year 2100:
The dashed curve is for total extraction of about double (400x109 barrels) the solid curve,
which corresponds to a reserve of about 240 x109 barrels.

The large dip in crude-oil extraction due to the Iranian/Islamic Revolution put Iran in a good position for future crude-oil extraction, causing its peak to be delayed until at least 2015.

Wow.......  three more years.

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The Delusional Thinking of the War Party

That such a significant cohort of CM.com commenters are members of the war party is worrying, and disappointing.   To a person I suspect they are unaware of the fact helpfully noted by HarryFlashman above regarding the deliberate mistranslation of Ahmedinejad's remarks by MEMRI and, as intended,  the subsequent parrotting of it ad nauseam by the MSM and politicians.

I had hoped that this self-selected community at CM.com were true critical thinkers but it seems that the MSM has done its job well as even here we find many supporting a war that will bring ruin upon us all.

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Recognition of a threat does not equal advocacy for war

debu wrote:

That such a significant cohort of CM.com commenters are members of the war party is worrying, and disappointing.   To a person I suspect they are unaware of the fact helpfully noted by HarryFlashman above regarding the deliberate mistranslation of Ahmedinejad's remarks by MEMRI and, as intended,  the subsequent parrotting of it ad nauseam by the MSM and politicians.

I had hoped that this self-selected community at CM.com were true critical thinkers but it seems that the MSM has done its job well as even here we find many supporting a war that will bring ruin upon us all.

debu-

Funny, I have not yet seen a single comment here in this thread advocating a war in Iran.  There were only a handful of commentors (one of them that just registered today) that described Iran as belligerent and poses some threat to it's neighbors and/or regional stability, yet not one said war was the right thing.  So how does this make up a "significant cohort" of CM.com warmongers? 

Just because one party is being a bully does NOT automatically make the other bullied party a sainted and non-threatening entity.  Isn't it possible to make a case that Iran (or rather the ruling regime in Iran) poses some level of threat and has demonstrated ill intent and actions (most of it through proxies in the region), but still be against a military conflict?  Ignoring the subtleties and details of the situation in favor of a black & white mindset is a sure recipe for pain and bad decisions.

Maybe one or two here cited the mistranslation you refer to, but if you really want to help you can try simply educating them instead of talking down to them.

- Nick

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Wow. . .what hubris.

I had to smile in disbelief at the appalling arrogance you demonstrate with these statements.  We are so disappointed in ourselves, and are sorry to have disappointed you.  I'll try to stay in-bounds next time.

Try to get past all the conspiracy theories and self-loathing and consider that some of the members of the "self-selected" community might see things differently:

It is possible that the Iranian regime is irrational in its motivations.  Read a bit about Shia eschatology.

It is possible that they are developing a nuclear weapons capability.  There are far easier roads to nuclear electrical generation.

It is possible that they seek to strike Israel with nuclear weapons.  Are we to ignore concurrent advances in ballistic missile technology?

I am as open to these possibilities as I am to the idea that the situation is being manipulated to further other objectives.  I don't see this as evidence of a lack of critical thinking, but a consideration of the facts about the Iranian theocracy, the nature of Shia Islam and twelvers in particular, and the statements of the Iranian leadership.  Lots of people can understand Farsi, and there is no mistranslation of say, the speech Ahmajinadad gave at the UN (for example).

It is possible that this is a real threat, and one that will resolve itself.  I am not willing to accept a mushroom cloud over Tel Aviv as one of the outcomes.  I am suspcious of the timing (as CM stated).  I am aware that war has a cost (I am a former infantry officer in the US Army), but I am also aware that  allowing a dangerous regime to obtain nuclear weapons is a bad thing.

A nuclear detonation anywhere may bring "ruin upon us all" too.

Get off your high horse and consider that you may not be the smartest guy in the room.

Rector

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Damnthematrix wrote: Ruhh

Damnthematrix wrote:

Ruhh wrote:

Just a thought. A friend of mine mentioned that an oil shock would be a great way to gain more support for the XL Keystone pipeline.

When will people realise that Nth America is TOTALLY INCAPABLE of supporting its greedy oil needs regardless of how many bloody pipelines you build?

If a war stops all oil from the NE to flow, you can kiss your lifestyle goodbye....

Mike

That's why the US put Marines in Australia.  You always need a Plan B.;-)

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huh?

debu wrote:

That such a significant cohort of CM.com commenters are members of the war party is worrying, and disappointing.   To a person I suspect they are unaware of the fact helpfully noted by HarryFlashman above regarding the deliberate mistranslation of Ahmedinejad's remarks by MEMRI and, as intended,  the subsequent parrotting of it ad nauseam by the MSM and politicians.

I had hoped that this self-selected community at CM.com were true critical thinkers but it seems that the MSM has done its job well as even here we find many supporting a war that will bring ruin upon us all.

I'm wondering who is delusional. No one said anything advocating or supporting war.  It's quite insulting to call folks here "members of the war party".  I'm just curious.  In your opinion, did Ahmedinejad deny the existence of the Holocaust or was he just misquoted?  You evidently are well informed on the issue and I'd like to get your take on things.

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motivations

(CM wrote)

Once again, I am deeply confused as to the timing of the perception of an Iranian threat, right now at this critical moment of economic weakness. The very last thing the world economies need is a vastly increased price for oil, which is precisely what a war with Iran will deliver.

It seems confusing if they think as we do, but odds are their motivations are very different so they are probably approaching the issue from a different direction.  Some possible intentions and motivations that come to mind:

Possibility #1:  The US and Western leadership intentions are for war, and they are (over?)confident in their ability to neuter Iran and secure the Strait within one or two months' time and avoid prolonged economic distress.  I like some others think that is unrealistic (I think Iran could be mostly neutralized but taking far longer and at a much higher cost), but we've seen how over-optimistic the US leadership was about taking care of Iraq.  The motives for taking on Iran may include thwarting it's nuclear ambitions and preventing a nuclear arms race in the region, but the primary motive is securing a long-term source for oil.  The US makes deals to "buy off" China & Russia into not getting involved, and China & Russia accept the deal assuming that the US will be biting off more than it can chew in trying to secure the region, and ready themselves to move into the power vacuum created when the West eventually leaves.  Kind of a "take one step back to take two steps forward" motivation.

Possibility #2:  The US and West don't want war, but want to "contain" Iran and are deliberately trying to keep tensions high to keep attention diverted from domestic issues.  If Iran over-reacts then the likely result is war and worldwide economic decline, but Iran gets assigned much of the blame for triggering it and the West can use the opportunity to install a friendlier regime for long term stability.  This also implies a certain level of confidence or over-confidence in their ability to neutralize Iran quickly.

Possibility #3:  The US leadership doesn't want war, but are feeling very threatened by the possibility of Iran delivering oil without the use of dollars.  The US leadership feels a massive threat display and crippling sanctions are needed to dissuade Iran from moving away from the dollar.  They may or may not feel confident in their ability to neutralize Iran quickly, but feel risking a potential war is better (for them) than the alternative of an almost certain major weakening in dollar dominance.

In all three of these cases, I'm assuming that they think of the nuclear issue as either a secondary concern or a convenient justification.  If military action occurs, I think we'll see if this turns out to be true or not by seeing if any Western military actions are limited to bombing nuclear sites and the military defenses near those sites or the Strait of Hormuz.  If the scope expands far outside these areas, then I think that will go a long way demonstrating that the real motivation is about oil or power.

And lastly, as a more "outside" possibility..... say there are certain power players in government and finance who would find such a disruption an opportunity to increase their wealth or power.  What may be bad for the economy as a whole might be exceptionally profitable for an influential few.  If those power players have done their homework they might (like us) see a painful economic decline as an inevitability, and may decide to choose the trigger-point and nature of the decline so they have a greater chance to personally profit from it.  It's a kind of mindset that reminds me of a Star Trek quote regarding the Ferengi Rules of Acquisition:

Dax: As the 34th Rule of Acquisition states, "Peace is good for business".
Quark: That's the 35th Rule.
Dax: Oh, you're right. What's the 34th?
Quark: "War is good for business". It's easy to get them confused.

-------------

- Nick

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ao wrote: Damnthematrix

ao wrote:

Damnthematrix wrote:

Ruhh wrote:

Just a thought. A friend of mine mentioned that an oil shock would be a great way to gain more support for the XL Keystone pipeline.

When will people realise that Nth America is TOTALLY INCAPABLE of supporting its greedy oil needs regardless of how many bloody pipelines you build?

If a war stops all oil from the NE to flow, you can kiss your lifestyle goodbye....

Mike

That's why the US put Marines in Australia.  You always need a Plan B.;-)

Aaaah.... if only we HAD oil!!

Mike

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the XL Keystone pipeline

Mark_BC wrote:

Ruhh wrote:

Just a thought. A friend of mine mentioned that an oil shock would be a great way to gain more support for the XL Keystone pipeline.

I didn't understand why Obama opposed the pipeline. As you say, maybe we need a shock first. I personally am deadset against the Northern Gateway pipeline, for both environmental and strategic reasons. North America's oil should stay in North America. We shouldbe using it to build out a solar energy infrastructure, not sending it to Asia to burn in ICE's, never to be seen again. Plus, when global currencies collapse and the only thing of value is energy, food and to some extent minerals, then why would any country export oil? What is there of value that it could be traded for?

What may we want to sell it for you ask? Well, maybe something that we dumbasses Canadians can't make for ourselves: cars!

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debu wrote: I had hoped that

debu wrote:

I had hoped that this self-selected community at CM.com were true critical thinkers but it seems that the MSM has done its job well as even here we find many supporting a war that will bring ruin upon us all.

Who cares if war brings ruin upon us.....gold will skyrocket and we will all be RICH!!!!!

Oops, I forgot, I sold my gold . So much for my career as a war profiteer...

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We need a "like" button

I would click on it for JAGs comment   

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(No subject)

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nickbert

nickbert wrote:

(CM wrote)

Once again, I am deeply confused as to the timing of the perception of an Iranian threat, right now at this critical moment of economic weakness. The very last thing the world economies need is a vastly increased price for oil, which is precisely what a war with Iran will deliver.

Possibility #1:  The US and Western leadership intentions are for war, and they are (over?)confident in their ability to neuter Iran and secure the Strait within one or two months' time and avoid prolonged economic distress. 

Possibility #2:  The US and West don't want war, but want to "contain" Iran and are deliberately trying to keep tensions high to keep attention diverted from domestic issues. 

Possibility #3:  The US leadership doesn't want war, but are feeling very threatened by the possibility of Iran delivering oil without the use of dollars.  The US leadership feels a massive threat display and crippling sanctions are needed to dissuade Iran from moving away from the dollar.  They may or may not feel confident in their ability to neutralize Iran quickly, but feel risking a potential war is better (for them) than the alternative of an almost certain major weakening in dollar dominance.

My feeling is that it's a combination of 2 and 3. 

Any command-level officer in the US armed forces that's telling the politicos that Iran will be a "cakewalk" or quick, or that the risks are "manageable" is outta their ever-lovin' mind.  Outright acts of war will bring on all sorts of asymmetric responses by Iran (in addition to whatever military responses they can muster) in the form of terror attacks up and down the ME (and possibly in the US and Europe [if NATO or EU countries are "with us"]), in my opinion.  And the economies of the world are stretched so tight (and so reliant on figurative duct tape and baling wire to hold them together) that the shocks that would accompany an actual outbreak of hostilities IMO will send them careening into brick walls everywhere.

But maybe the folks in charge know the economy is going down anyway, and they figure they can blame the Big Crash on Iran.  "Gee, all them green shoots were coming up all over and then IRAN had to go and ruin it all!"

In happier news, it's almost time to get my seeds started for Garden-Rama 2012...

Viva -- Sager

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My pea sized brain says  it

My pea sized brain says  it is all  a load of crap .     The war mongers and the oil cartel are loving the income they are getting off this Iran mess .

If the price of oil was to drop  50%   the economy would fix itself  in short order .    I know this would not fix the other 2 "E's"   but might buy some time...

It is not going to happen so no reason to dwell on it  but ...

You smart one can blow holes in my thinking and come up with something .

FM

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