The Iranian Threat: The Bomb or the Euro?
By Dr. Elias Akleh
In its economical war Iran is treading the same path Saddam Hussein had started when he, in 2000, converted all his reserve from the Dollar to the Euro, and demanded payments in Euro for Iraqi oil. Many economists then mocked Saddam because he had lost a lot of money in this conversion. Yet they were very surprised when he recuperated his losses within less than a year period due to the valuation of the Euro. The American administration became aware of the threat when central banks of many countries started keeping Euros along side of Dollars as their monetary reserve and as an exchange fund for oil (Russian and Chinese central banks in 2003). To avoid economical collapse the Bush administration hastened to invade and to destroy Iraq under false excuses to make it an example to any country who may contemplate dropping the Dollar, and to manipulate OPEC’s decisions by controlling the second largest oil resource. Iraqi oil sale was reverted back to the petrodollar standard.
There is only one technical obstacle concerning the use of a euro-based oil exchange system, which is the lack of a euro-denominated oil pricing standard, or oil ‘marker’ as it is referred to in the industry. The three current oil markers are U.S. dollar denominated, which include the West Texas Intermediate crude (WTI), Norway Brent crude, and the UAE Dubai crude. Yet this did not stop Iran from requiring payments in the euro currency for its European and Asian oil exports since spring 2003.
Iran’s determination in using the petroeuro is inviting in other countries such as Russia and Latin American countries, and even some Saudi investors especially after the Saudi/American relations have weakened lately. This determination had also invited an aggressive American political campaign using the same excuses used against Iraq: WMD in the form of nuclear bomb, support to "terrorist" Lebanese Hezbollah organization, and threat to the peace process in the Middle East.
The question now is what would the American administration do? Would it invade Iran as it did Iraq? The American troops are knee-deep in the Iraqi swamp. The global community — except for Britain and Italy- is not offering any military relief to the US. Thus an American strike against Iran is very unlikely. Iran is not Iraq; it has a more robust military power. Iran has anti-ship missiles based in "Abu Mousa" island that controls the strait of Hermuz at the entrance of the Persian Gulf. Iran could easily close the strait thus blocking all naval traffic carrying gulf oil to the rest of the world causing a global oil crisis. The price of an oil barrel could reach up to $100. The US could not topple the regime by spreading chaos the same way it did to Mussadaq’s regime in 1953 since Iranians are aware of such a trick. Besides Iranians have a patriotic pride of what they call "their bomb".
http://www.informationclearinghouse.info/article8354.ht... The Meridian Report
A Global Perspective on Energy
If you think the invasion of Iraq was about 9-11 and Al-Qaida then I urge you to think again. Cast aside all that the major television networks have programmed into your daily thinking, take a deep breath and slowly exhale. Now, think…real hard. Were any WMD’s (Weapons of Mass Destruction) ever found in Iraq? Has any connection between 9-11 and Saddam Hussein been solidly proven? The answer to both queries is a resounding NO. So why then would the US, the world’s largest economic entity, undertake an invasion of Iraq to capture and remove leader Saddam Hussein? The answer is all about economics. More specifically, Currency. That’s right, Currency. You see, Saddam Hussein had developed a very serious, very viable plan to sell Oil from his country in exchange for Euros. Had he succeeded in putting this plan into action, the damage to the stature of the US Dollar as the global reserve currency would have been un-fixable. Oil importing nations would have reduced their holdings of US Dollars and added Euros to their vaults. The damage to the US economy which is entirely predicated on US Dollar supremacy could have been quite serious indeed. So, in the immediate aftermath of 9-11, the US launched a major offensive under the rather attractive name Operation Iraqi Freedom to trounce any Oil for Euros plans once and for all. But CNN told you a different story. Over and over, night after night you were reminded that Saddam Hussein was a monster. He was sitting on a massive cache of destructive weapons that threatened your safety. He was intimately linked to Al Qaida and global terror. Carefully crafted stories by embedded reporters and film footage of US and British troops moving triumphantly towards Baghdad made the while thing seem larger than life.
Now, fast forward to December 2005. As I write this edition of the Meridian Report, there is a growing sense of deja-vu. This time, it is Iran that is causing problems. But, CNN will have you believe that Iran is causing nuclear problems by refusing to scale back its nuclear program. The real story is that by March 2006 Iran is threatening to have in place an entity called the Iranian Oil Bourse. Trading of Oil on this exchange will be denominated in – yes you guessed it – Euros. A well choreographed play from Saddam’s little black book of game day strategies. The Iranian Oil Bourse will go toe to toe and compete for global prominence with NYMEX in New York and the International Petroleum Exchange in London. Oil trading on these exchanges is done in US Dollar terms. That is why when we hear a quote given for Oil it is always basis the US Dollar. Oil is the lifeblood of the global economy, the US Dollar is the global reserve currency and Oil is quoted in US Dollar terms. A simple 1-2-3 argument.
But this simple 1-2-3 argument may be about to come under attack. A successful start-up of trading operations on this Bourse could lead to an erosion of the US Dollar. Hence this Bourse is a de facto weapon. A weapon so ferocious, that has the ability to undermine the entire US economy, and topple the US Dollar from its lofty perch. After all, why would Oil importing nations need to keep as many US Dollars in reserve if they can purchase Oil in Euros? The ramifications of a weakened US Dollar are serious. Global purchasers of US debt instruments may begin to shy away from a weaker currency in favor of Euro denominated debt instruments. This would place upward pressure on US interest rates and the serious imbalance of the US economy would be laid bare for all to see (as if we don’t already see it). After all, the US has no choice but to keep foreign investors interested in buying US debt. Management of the trade deficit and budget deficit depends on it. The housing market would surely collapse under the weight of higher interest rates. With mortgage rates now above 6% we are already seeing the signs of weakness of the housing market. Now imagine mortgage rates at 8% or even 9%. Given this scenario, it should come as little surprise that China recently moved all of a sudden to re-position its Renminbi currency away from the US Dollar and instead to a basket of global currencies. The Chinese are definitely not stupid. They have excellent relations with Iran and are well aware of the threat this new Bourse poses. Notice how the Chinese still have not told us the exact makeup of this basket? However, you can bet the Euro figures very prominently in the weighting of this basket.
http://www.321energy.com/editorials/meridian/meridian12... 
Petrodollar Warfare
Oil, Iraq and the Future of the Dollar
William R. Clark
The invasion of Iraq may well be remembered as the first oil currency war. Far from being a response to 9-11 terrorism or Iraq's alleged weapons of mass destruction, Petrodollar Warfare argues that the invasion was precipitated by two converging phenomena: the imminent peak in global oil production, and the ascendance of the euro currency.
Energy analysts agree that world oil supplies are about to peak, after which there will be a steady decline in supplies of oil. Iraq, possessing the world's second largest oil reserves, was therefore already a target of U.S. geostrategic interests. Together with the fact that Iraq had switched its oil export currency to euros -- rather than U.S. dollars -- the Bush administration's unreported aim was to prevent further OPEC momentum in favor of the euro as an alternative oil transaction currency standard.
Meticulously researched, Petrodollar Warfare examines U.S. dollar hegemony and the unsustainable macroeconomics of 'petrodollar recycling,' pointing out that the issues underlying the Iraq war also apply to geopolitical tensions between the U.S. and other countries including the European Union (E.U.), Iran, Venezuela, and Russia. The author warns that without changing course, the American Experiment will end the way all empires end with military over-extension and subsequent economic decline. He recommends the multilateral pursuit of both energy and monetary reforms within a United Nations framework to create a more balanced global energy and monetary system thereby reducing the possibility of future oil-depletion and oil currency-related warfare.
http://www.petrodollarwarfare.com /
Iraq having WMD and being a threat to the US was as we have known for years (long before that point was validated recently) was bunk. The tinfoil mad hatters were the liars that suggested as much. Right Donald, Dick, Colin etc?
Iran having nuclear weapons and posing ant "imminent threat" is also bunk. The imminent threat is the threat of the devalued dollar to Wall $treet. And the reduction in power of the petrodollar also impacts the cheap and easy access to the worlds oil supply to the world's largest consumer of oil- The Pentagon.
Printer-friendly format
Email this thread to a friend
Bookmark this thread
(1000+ posts)
Send PM |
Profile |
Ignore
