Oil Traders Fear an Attack on Iran
Okay, now I’m worried.
There have been several rounds of reports that the war-obsessed Bush administration was getting ready to attack Iran-first last September, then in December, and more recently in January and February.
The one thing that kept me thinking that a catastrophic war with Iran might not be in the offing was oil prices, which didn’t seem to be acting as one would expect them to if there were a major war looming in the Persian Gulf. Oil prices, in fact, have been drifting slowly downward since September 2006, when they hit $68.85. Yet if there were going to be a hot war between the U.S. and Iran, one would expect much higher prices. After all, most of the combat would be occurring along Iran’s heavily armed coastline and in the Gulf, through which over a quarter of all the world’s oil passes. In the event of such a conflict, oil shipments would shut down from that region as underwriters jacked the price of insuring oil tankers in the Gulf to astronomical levels. Estimates of how expensive oil could become in the event of a US attack on Iran, the world’s second largest oil producing nation, have ranged as high as $200/barrel-a level that would bring the global economy to a screeching halt.
Well, there are new reports circulating now that an attack by US air and naval forces could come in early April, and this time, the oil traders are taking them seriously. On Tuesday, oil futures shot up $5/barrel to hit $68/barrel-quite a jump, and the highest price for oil since last September.
Reports say that traders were responding to rumors-unsubstantiated-that Iran had fired on an American ship in the Gulf, and no doubt also to the ongoing tensions over Iran’s capture and detention of 15 British sailors, whom it claims had illegally entered Iranian territorial waters.
Phil Flynn, a trader with Alaron Trading in Chicago, was quoted as saying that the oil market has been "on pins and needles" because of the tensions in the Persian Gulf between the US and Iran.
Adding to worries about oil supplies from the Gulf, no doubt, is the vast armada that the U.S. has amassed up close to Iran’s borders-an armada that includes two fully armed aircraft battle groups, equipped with hundreds of strike aircraft and tomahawk cruise missiles and capable of delivering a crippling blow to Iran’s military and industrial infrastructure.
The Bush administration, while repeatedly insisting it has no plans to attack Iran, has pointedly also stated on numerous occasions that "all options are on the table" in dealing with what it claims are Iraqi efforts to develop nuclear weapons capability. The White House and Pentagon have also been running a propaganda campaign-ominously reminiscent of the run-up to the Iraq invasion–of trying to make a case that Iran is providing technical aid, weapons and training to Iraqi insurgents, particularly in the use of armor-penetrating explosive devices.
Iran, for its part, is continuing to develop its uranium refining skills and capacity, all the while denying that it has any plans to develop nuclear weapons. This past week, the United Nations voted stiffer sanctions on Iran for failing to bring its nuclear program into compliance with international rules and monitoring.
Iran denies that it has been aiding Iraqi insurgents or providing advanced weapons for use against US forces in Iraq, and indeed the evidence presented by the U.S. has been viewed with considerable skepticism.
Meanwhile, there are reports in the European press that American forces are massing along the Iraq border with Iran, even as the U.S. is conducting war games in the Gulf simulating an attack on Iran. There have also been reports for some time that US special forces have been operating in Iran, gathering intelligence and establishing coordinates on likely bombing targets, and perhaps linking with anti-government groups inside Iran that have been conducting terror attacks there. More recently there have been reports that the Bush administration has been using misappropriated Iraq reconstruction funds to finance Kurdish and Al Qaeda group attacks inside Iran.
Back in the U.S., the Bush administration succeeded in getting Congress to back off of attempts to include legislation barring the White House from attacking Iran without prior Congressional approval. Bush has already claimed that Iran is a terrorist nation and that he thus has the authority to attack that country at will because of the 2001 Congressional Authorization for Use of Military Force which was actually an authorization for the US attack on the Taliban and Al Qaeda in Afghanistan.
It all would seem to point to the real possibility of an attack on Iran-a move that would be a war crime, that would be a disaster for the U.S., that would spark a global recession, and that would inflame the entire Middle East for years to come.
Do the oil traders know something that we in America should be knowing?
And why aren’t Congress and the US media discussing all this?
DAVE LINDORFF is the author of Killing Time: an Investigation into the Death Row Case of Mumia Abu-Jamal. His n book of CounterPunch columns titled "This Can’t be Happening!" is published by Common Courage Press. Lindorff’s newest book is "The Case for Impeachment",
co-authored by Barbara Olshansky.
He can be reached at: firstname.lastname@example.org