generalspeaking

Suspense of the Unknown

Now isn't that a classic? What's termed being between a rock and a hard place?

Having to carefully assess just which assumes greater moral and practical importance; saving the world from the volatile, irrational behaviour of a potentially nuclear-armed religiously-zealot country eager to bring the current world to a throbbing halt so the next world can take over which will exalt them personally - or having to absorb further financial hardships in an already-beleaguered global economy.

It does, quite, resemble that classic double-edged sword.

In responding to Iran's threat to close off the Strait of Hormuz through forceful mediation, not merely diplomatic and strategic intercession, the developed world faces the very real prospect of inflicting further financial damage upon itself through the heightened cost of energy. (Not to mention the cost of war.)

Should Iran attempt to cut off its nose to spite its face by stopping its oil exports and that of others, it would harm its own economy. But of course its economy is already in a stiff downward spiral due to fairly universal sanctions, which are on the way to becoming even more inimical to its financial stability.

"If sanctions are adopted against Iranian oil, not a drop of oil will pass through the Strait of Hormuz", promises Mohammad Reza Rahimi, an Iranian vice-president.
"Our enemies will only abandon their plots when we give them a strong lesson."

That strong lesson is being played out in the threats that have been timed to coincide with the country's war games in the Gulf of Oman. Complementary to the nuclear program which is paving the way for Iran's eventual success in developing nuclear-tipped missiles, are the naval vessels and exercises testing torpedoes and mine-laying.

Britain, France and Germany are agreed in their determination to mount an EU oil embargo. The U.S. is prepared to sign legislation blacklisting anyone doing business with Iran's central bank, and engaging in oil transactions. Iran is OPEC's second largest oil exporter, and it could be essentially devastated by these moves.

Of course the EU and the U.S. will also stand to be harmed by less oil-energy availability and increased costs.

Which the Gulf States and Saudi Arabia have claimed to be able to avoid by increasing their own output in a move to offset that loss of Iranian oil. A claim that seems doubtful since Iran is OPEC's second largest exporter. So oil will be scarcer, and the cost far greater, impacting deleteriously on everything from heating to transportation to production costs.

It's a tough game both sides are playing, with China and Russia on the sidelines, supporting Iran.

"The free flow of goods and services through the Strait of Hormuz is vital to regional and global prosperity. Anyone who threatens to disrupt freedom of navigation in an international strait is clearly outside the community of nations; any disruption will not be tolerated."

This edgy flirtation with a breakout of violent hostilities and its long-term outcome which no one can possibly visualize with any degree of accuracy, infusing the world with additional uncertainties revolving around the growing need for energy at a time when so much instability is the order of the day, does not speak optimistically for 2012.

Labels: Iran, Middle East, Technology, Traditions, Troublespots

posted by Pieface @ Thursday, December 29, 2011