West-Driven Tensions against Iran Pushing Oil Prices Up

As the US and Israel intensify their war rhetoric against Iran, the global oil market is witnessing hiking prices almost on a daily basis, inflicting a huge loss on consumers.

Albert Einstein once said, “Two things are infinite: the Universe and human stupidity; and I’m not sure about the universe.”

The words are speaking for themselves these days. Thanks to the reckless remarks by the war rhetoric against Iran against Iran, oil prices continue to post their highest ever gains each and every day – amid the crippling global downturn.

That’s why, ahead of the November presidential election in the US, the Obama Administration’s campaign is worried. About a lot of things, but in this case about deep economic downturn and the rising cost of oil, spiking both on inflation fears and a seriously tight supply.

Unspoken in all this concern about supply shortages is one of the world’s largest oil producer, Iran. It is true that the unilateral sanctions by the West have seen Iran’s oil exports drop to some extent to the European destinations. But it is equally true that Iran will always find somewhere else to sell its black gold – at a time when it is needed at the American and European markets.

This was of course the whole point of the sanctions, and the Obama Administration would likely be bragging about how they are imposing it on Iran during their election campaign, but if only the measures weren’t also hurting everyone else worldwide.

The Obama administration is free to say otherwise, but according to many Western energy analysts and experts, without any oil from Iran, the impact of losing Iran’s supply is bound to raise concern about how much worse things might get on the global market, especially in the coming months.

Crude oil prices are as high as $115 per barrel and with the Israeli war rhetoric against Iran continuing, it is very likely that this trend will continue.

Even if the war doesn’t begin (which won’t, because Israel is only bluffing) the existing tensions will cause the price to inch closer to the $200 mark. But things could turn from bad to worse if Israel launches a strike against Iran’s nuclear installations.

Everyone hopes that if Iran’s exports are affected, Saudi Arabia and other OPEC members will boost output and compensate the shortfall in supplies. But this is wishful thinking, because the excess capacity has been almost exhausted and not even Saudi Arabia will be able to produce more than an additional 1 million barrels per day for just a few weeks (according to market analysts).

Add to this the fact that Saudi Arabia relies on the Strait of Hormuz to export oil and it becomes clear that the West has another reason to expect prices to go up. Unless the United States succeeds in keeping the Strait open and safe, crude oil prices will soar and seemingly incredible values of $200 per barrel are possible.

In the words of US Republican strategist David Frum, “Obama’s Iran policy is to visit crippling sanctions on Iran and to attempt to impose a financial embargo on the sale of Iranian petroleum. If you are an oil futures trader and you hear that, you might well conclude that Obama is trying to take Iranian petroleum off the market. You would be right. Guess what: less supply, assuming constant or increasing demand, equals higher prices.”

Frum goes on to state, “Obama’s further policy is that no options are off the table, which is an implicit threat to strike Iran militarily if the oil embargo fails in changing Iranian policy of enriching uranium. If you are an oil futures trader and you hear that, you have to build the possibility of a military strike into the price six months down the road. And that would cause a big spike in gasoline prices.”

What Frum really means is that it is time for Washington and its allies to leave behind their old ideas of world domination as it will eventually lead to their self-destruction and also because the changing world has brought new opportunities for peace and the chance to join a community of nations.

Sadly enough, ahead of the November presidential race, the American people are once again being hit by extremely false propaganda against Iran, designed to do much worse than brainwashing them. It is designed to hurl them and their children into a long war against the Islamic world.

In this sense, what the American people need now is not mere skepticism, but the toppling of the liars on the Capitol Hill where stupidity has no limits, and electing a leader that has respect for international law, common sense and their own welfare (not Israel) – before things get worse than what they are now and before crude oil prices hit the $200 mark!