More On Iran, Straits of Hormuz & Persian Gulf Oil

MORE On a High Stakes Poker Game Playing out at the Straits of Hormuz which connects the Persian Gulf to the Indian Ocean

As a detached - but not disinterested - observer I am horrified by the easy way those who justifiably hold fears for their country and those who truly want war, any war, to happen and happen quickly, are fanning the coals of what could turn out to be a very large conflagration!

Add those dangerous elements to the mediocre capacity of the people in power today who have the "hammer and nail tool box" mentality, and we may well get ourselves into a shooting and killing war the consequences of which no one bothers to even discuss. It's like replaying an old nightmare with Rumsfeld and Cheney still in charge!

Here's the way I see it. America, which sometimes can't do right for doing wrong, is about to do a re-run of the knee jerk reaction to the Nine Eleven Event. For a moment we had the option to label that as a crime and call the FBI, or to name it an act of war and send in the soldiers! Now, $7 trillion in borrowed money later, and 6,000 KIA on our side, and maybe 200,000 on the other sides, the world is not safer nor are we apparently any the wiser. The Iranians can't get over 1953 (our overthrow of Iran’s democratic government), just as we can't get over 1959 (losing Cuba to Castro). The Iranians are not the only blockheads in the world.

We gave up our credibility over nuclear proliferation when we probably supplied the plutonium to Israel, after the Six Day War of 1967, to make their own nuclear bombs. As several authors have pointed out in recent years, having nuclear weapons does not make a country safe or safer as in fact, it is more likely to do just the opposite because with nuclear weapons a country may think it can get away with things it otherwise would not do. It is all too tempting to self delude because of the imagined capability. Negotiating out of serious situations is not so crucial when you as a country can bomb its way out?

Consider this. Eighty-percent of Iranians live outside the major cities. They still live a life as they did in the 1950s. You cannot shut off their electricity because they do not have electrify. For the most part they live in villages and have dirt roads between theirs and the next village over. My point is, sanctions and bombs do not change their way of life. Without actually planning that, this coincidence means they are nearly invulnerable to outside forces.

We, on the other hand, are really at the mercy of the price of oil. We escaped the most recent event - the short shut down of Libyan oil - by drawing about 30 million barrels of oil out of out Strategic Reserve. This stopped the spiking price of crude oil as set by the speculators (over which we seem to lack any control whatsoever).

Everybody knows that oil is fungible. That is, one barrel is like the next barrel. (That’s not exactly true but it’s close enough to make it seem to be true). That means that even though we get only 2 mbd - million barrels a day - from the Persian Gulf out of the 19-20 mbd we consume, we could replace that from the Strategic Reserve.

But that leaves Japan and South Korea short on oil. We cannot undertake to supply those countries. The price of crude would skyrocket if the Strait of Hormuz was closed. The worldwide 80 mbd craving for crude oil, deprived of (20%) 15-16 mbd from the Persian Gulf, would make the price of oil so high you would not want to guess.

It is easy to see the Congress being asked by the president to declare a state of economic war! We would have no alternative but to go to fixed prices and to ration gasoline at the pump. How’s 20 gallons per month, per vehicle, at $5 a gallon sound? That would work for 6-8 weeks but then the pressure would be on to "let the market set the price!"

As I often ask those around me who complain about a gridlocked Washington, "How much money did you send to your congressman last year?" Your influence is in a direct proportion to the amount of money you sent! Thanks for your time. Don

Excerpted from the story. In the audience at that lecture was Rafi Eitan, 85, one of the Mossad’s most seasoned and well-known operatives. Eitan agreed with Dagan [former Mossad chief] that Israel lacked the capabilities to attack Iran. When I spoke with him in October, Eitan said: “As early as 2006 (when Eitan was a senior cabinet minister), I told the cabinet that Israel couldn't afford to attack Iran.

First of all, because the home front is not ready. I told anyone who wanted and still wants to attack, they should just think about two missiles a day, no more than that, falling on Tel Aviv. And what will you do then?

Beyond that, our attack won’t cause them significant damage. I was told during one of the discussions that it would delay them for three years, and I replied, ‘Not even three months.’ After all, they have scattered their facilities all over the country and under the ground. ‘What harm can you do to them?’ I asked. ‘You’ll manage to hit the entrances, and they’ll have them rebuilt in three months.’ ”

Asked if it was possible to stop a determined Iran from becoming a nuclear power, Eitan replied: “No. In the end they'll get their bomb." The way to fight it is by changing the regime there. This is where we have really failed. We should encourage the opposition groups who turn to us over and over to ask for our help, and instead, we send them away empty-handed.”

Israeli law stipulates that only the Knesset’s 14 members making up the security cabinet have the authority to make decisions on whether to go to war. The cabinet has not yet been asked to vote, but the ministers might, under pressure from [PM] Netanyahu and [Defense Minister] Barak, to answer these crucial questions about Iran in the affirmative: that these coming months are indeed the last opportunity to attack before Iran enters the “immunity zone:” that the broad international agreement on Iran’s intentions and the failure of sanctions to stop the project have created sufficient legitimacy for an attack; and that Israel does indeed possess the capabilities to cause significant damage to the Iranian project.

In recent weeks, Israelis have obsessively questioned whether Netanyahu and Barak are really planning a strike or if they are just putting up a front to pressure Europe and the U.S. to impose tougher sanctions. I believe that both of these things are true, but as a senior intelligence officer who often participates in meetings with Israel’s top leadership told me, the only individuals who really know their intentions are, of course, Netanyahu and Barak, and recent statements that no decision is imminent must surely be taken into account.

After speaking with many senior Israeli leaders and chiefs of the military and the intelligence, I have come to believe that Israel will indeed strike Iran in 2012. Perhaps in the small and ever-diminishing window that is left, the United States will choose to intervene after all, but here, from the Israeli perspective, there is not much hope for that.

Instead there is that peculiar Israeli mixture of fear - rooted in the sense that Israel is dependent on the tacit support of other nations to survive - and tenacity, the fierce conviction, right or wrong, that only the Israelis can ultimately defend themselves. END

By Ronen Bergman, an analyst for the Israeli newspaper Yedioth Ahronoth. He is the author of ‘‘The Secret War With Iran.”