Iran is really painting itself into a corner over its nuclear program. Not only is Israel widely expected to attack Iran in the coming months, but now Iran is further alienating the West by cutting off oil supplies to Britain and France. The move is likely to backfire, however, because Britain and France have already made great strides to stop buying oil from Iran.
France's Total, the state-run oil company and the largest in the country, has already stopped buying oil from Iran entirely. On top of the cutbacks, Saudi Arabia has agreed to step in and supply the EU with any shortfalls in oil from Iran.
As a former oil trader, these are the types of things that would usually get me excited. But it looks like the world is so sick of Iran's shit that everything has already been priced in and viable alternatives to Iranian oil have already been found. What would normally be a pretty dramatic trading event is likely little more than a tempest in a teacup at this point.
Which brings me to my question: where does Iran go next when all this fails? The US has already dispatched ships to counter any blockage to the Straits of Hormuz and Saudi Arabia has already marginalized the impact of any Iranian oil shortage. What other bargaining chip does Iran hold?
I'll be the first to admit that I wasn't overly concerned about Iran becoming a nuclear state; I just don't believe they're that relevant as a country. But I'll also admit that if Iran's nuclear ambitions can be easily confounded, why not? One less nuclear country in the world has to be a good thing.
With Israeli-backed militants planting magnet-bombs on the cars of Iranian nuclear scientists and other regional oil producers willing to profit from Iran's pain, why not pull Iran's teeth now? I'm not suggesting any kind of military intervention on the part of the US, more just a taking of the world's oil business elsewhere.
As much as I was against the Iraq War and the lies that were told to get us into it, it might yet serve some purpose vis a vis the Iranian people realizing that if they don't overthrow their own government, a coalition of Western governments might come in and do it for them.
In either case, I'd normally be all over long oil right now, but I'm just not convinced Iran is going to provide any more pop to the oil market. I'd love to hear from other energy traders. Am I missing something? Is Iran still a major factor in the market? Or are they just another Middle-Eastern backwater trying to capitalize on their 15 minutes of fame?
Nobody is going to attack Iran. Any "light attack" would fail miserably. And a "heavy attack" is completely out of question and would be a complete disaster for everyone possibly evolving into a big regional conflict or trigger some kind of WW3.
One you are completely wrong.
Two, GB imports 1% of it's oil from Iran. France imports 3% of its oil from Iran. This is just Iran puffing its chest trying to act tough, it is a useless move considering the eu had previously set sanctions against importation or Iranian oil.
^ Here, I fixed it for you. How would you react if it was this scenario?
I say, why don't everyone mind it's business so we can all be happy.
Greece imported ~1/3 of its oil from iran. Italy imported 10%, India about 12%. Its significant. We shouldnt have stopped the israelis from attacking them when we ruled iraq.
Good Job Iran.
"As a former oil trader, these are the types of things that would usually get me excited. But it looks like the world is so sick of Iran's shit that everything has already been priced in and viable alternatives to Iranian oil have already been found. What would normally be a pretty dramatic trading event is likely little more than a tempest in a teacup at this point."
Not sure if serious.
Iran starting shit ?
Strange, a country developing a peaceful nuclear program is being constantly threatened by Israel and the US.
Iran has every right to do whatever steps are necessary ensure its safety.
And lol at underestimating Iran and brushing it aside with terms such as "pulling its teeth" or "overthrowing their government by a coalition of Western countries".
You are being a war-mongerer and should be ashamed of yourself.
Iran is not Iraq or Syria, it is a regional SUPER POWER.
DEAL WITH IT !
The only trouble maker in that region is the STATE SPONSOR OF TERRORISM IE. ISRAEL.
And the US needs to get the fcuk out of the Middle EAST.
Once again, Iran's strategic rhetoric is more assertive its intentions and substance. This move won't impact supply fears. France only imports 3% of oil from Iran while the UK hasn't imported oil from Iran in 6 months.
When Iran makes a move towards Russia, India, Japan or China, this will be a move of substance and get the price moving. Iran wants to cut off oil supplies to put the brakes on the western worlds economic recovery, but there comes a threshold by which the Iranian leaders sit back and being to actually contemplate what poses a greater threat to Iran, ending the quest for nuclear weapons or stubbornly and naively pursuing these nuclear goals to the detriment of their country and citizens in the face of mounting economic pressures.
Gate crasher, stop posting. Let the adults talk about the adult stuff. Go back to reading your marx and RATM and dred locks.
You sound Butt-hurt. Just because I am bringing in a not-so-mainstream view , you dismiss my views as childish ? The Price of oil will sky rocket. There will be no war. The US and the European economy will be caught in a downward tail-spin. East Asia will rise and followed by Asia as a whole. A dawn of a new era has begun. Deal with it ! And go back playing with your lego sets. And keep watching the MSM like a brainwashed drone.
www.infowars.com much?
I have a different view of the situation. Both Iran and Israel have much more limited options than either admit. Iran's Central Bank is being crushed right now. Period. The only two options they have are to come to the table or to stall as long as possible, while accelerating all of their programs. Personally, I think they are doing the latter.
As far as an Israeli military strike goes, I don't think this option exists for them. The Israeli's are trying to act like they're not impotent while we "hold them back and talk them down." Iran wasn't stupid. After Israel bombed the Iraqi reactor, Iran spread out all of their facilities and heavily fortified them. From what I understand, a conventional precision military strike is not an option against Iran.
nice of the europeans to hasten the death of the USD as the global reserve currency. my gold positions are smiling.
Completely agree. Although if Iran is absolutely set on having a nuke, I don't see why we need be worried. We just scared the shit out of the ME with our nation-building plans. Invading Afghanistan, they were cool with since Osama was there, and everyone was on our side post 9/11. But after the whole Iraqi WMD thing, we (perhaps inadvertently) sent a clear message to the ME, that they're next. So I just think that Iran is trying to make sure that they have a trump card up their sleeve to protect themselves against invasion, should that situation ever present itself.
This kind of mind-set is the wrong one to have IMO. Let us remember that different cultures operate in different ways. Communism is bad, but the Chinese seem cool with it, so let them have their fun, and if/when the people clamor for a change (freedom/democracy), they will do it their own damn selves ala the Arab Spring. This goes double for the ME.
This way, we don't get our hands dirty, move one step closer to getting rid of our reputation as a warmonger, and save money with which we can hopefully lower these oppressive taxes on the successful.
Dude, chill.Ok.
I wonder how stretched Iran can really be even during these sections. It has been selling oil for a long time and has had the chance to build up some nice reserves. When Libya was falling, there was some talk of tens of billions in assets that had piled up.
Perhaps if Iran does have a stockpile of assets that it can use to support itself during this time, it can get by. Also, with the element of political/religious passion, the leaders might be able to take the country a long way with this war-time spirit, and they might not have so long to go before they enrich the nuclear material to the level of making a bomb (enriching uranium gets easier and easier as the uranium itself becomes more enriched).
I think the war on their central banks is much more significant. I see Israel bombing suspected nuclear development sites and Ahmadinejad being forced out.
War WILL happen simply because if Iran gets nukes, so will the rest of the ME. The only way we keep them non nuclear is by guaranteeing no one else gets nukes.
Iran is pissing off its European allies. Pretty stupid IMO.
With all the internet tough guys on this thread, we should set up a WSO Special Combat Brigade. We'll send you guys over there and the war will be over in a few hours.
I have an old GI Joe mobile command center that I will donate for your use.
Reuters: Here is the first EXCLUSIVE photo of WSO' chicken hawks in their mobile command center somewhere in Iran. The photo is said to have been taken by Newt Gingrich who decided to join the WSO force of good to prove Dr. Paul wrong.
This is why we can't "liberate" another Middle Eastern country. http://www.usdebtclock.org/
[quote=RagnarDanneskjold]This is why we can't "liberate" another Middle Eastern country. http://www.usdebtclock.org/[/quote]
I don't believe it. It's a lie. It's a .org not a .gov haha
I don't know, an election cycle is coming. Obama has decent eco numbers to run on. Another military campaign would be good to get the masses supporting the sitting President. When in doubt, drum up nationalism.
Israel was planning to attack Iran in the coming months....Israel getting aggressive, that's new
The nuclear development program is a non-debateable item in Iran, and the economy is suffocating from having so many trade revenues squelched. This is as much of Iran's effort to thump its chest in front of its own people as it is to intimidate the West.
It will be interesting to see how the U.S. handles this conflict.
Here's a good read for those interested in American involvement and a little bit of its history in the Middle East:
https://www.cia.gov/library/center-for-the-study-of-intelligence/csi-pu…
I have thought about putting the trade on using NOK instead of through commodities. The charts for nokjpy, usdnok, and eurnok look extremely compelling. The country has a budget surplus, is an exporter of energy, and their central bank doesn't play the fx devaluation game. With the trend for EU-petrol heading higher, I like NOK based on terms-of-trade improvements and fiscal/monetary prudence. I have considered converting my bank account base fx to NOK, but when you are as broke as I am it isn't really an option!
Some of you guys might be missing the geo-politics behind things going on in the Middle East. I am involved in Oil trading and follow these events with a keen eye on its impact on Crude Oil.
1) The Gulf Co-Operation Council (GCC) has been an instrumental force in the uprisings in Yemen, Syria, Bahrain (this one failed as Qatari and Saudi Arabian special forces put down the Shia rebellion) as well as the confrontation with Iran. The GCC is backed primarily by Saudi Arabia as well as Qatar. Both of these countries are majority Sunni while Iran is predominantly Shia.
2) The overthrow of Saleh in Yemen, Mubarak in Egypt, Qaddafi in Libya and now Bashar Al-Assad in Syria is/was more a Sunni power grab in the pretext of a revolution. Again, the GCC played a vital role with Saudi Arabia and Qatar financing dissidents and the US/France and UK willingly participating due to energy politics.
3) Iran quickly is losing allies in the ME and the balance of power is shifting heavily in favor of the GCC. The Middle East has also already been nuclearized as Saudi Arabia is rumored to have financed the Pakistani nuclear weapons program. Pakistan also has a stated nuclear first use policy to defend its territorial boundaries and Muslim brothers (paraphrasing here).
4) In Iran's position today, the only way it can defend its strategic interest in the "Persian Gulf" is through acquiring nuclear weapons as it could very well be the next domino to fall. Can't say I blame them.
India and China are the key cogs in the wheel now as it relates to Iranian crude sales. India has been routing Crude oil payments in USD through a bank in Germany and Turkey. Each of these multi-billion dollar credit facilities have been shut down over the last 12 months as sanctions have gotten tightened. Now India is paying direct in Indian Rupees and physical gold. But, Iranian imports from India are negligible compared to Oil sold. This fx issue is a huge problem for Iran.
China has been paying for its oil imports in Yuan. Iran-China trade is exponentially bigger than India and thus the oil trade is expected to continue regardless of economic sanctions.
Saudi Arabian spare crude capacity is heavier and sourer than Iran. Saudi Arabia is a key player in convincing Asian countries to go along with the sanctions, as it is the fall back spare supplier when producers such as Libya and Iran cut off supply to the world. But, how will the refineries process this grade ? How long can this game be played since 1 Macando will literally spike crude markets worldwide.
The sanctions have very deeply effected how Asia will pay for Iranian imports. Being long crude definitely is the safe play right now.
Also interesting is this map of the world.
http://en.wikipedia.org/wiki/Shia_Crescent
If you look at the recent events and whats going with Iran, you will notice that a push is being made to project power into Central Asia through where else, Afghanistan which Iran coincidentally shares a massive border with on the eastern front.
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