Posted in: Commentary,
by Gregg Laskoski on May 10, 2012 09:36 AM
Crude oil prices have fallen by $10 per barrel in the last 10 days. Why? Most people who follow oil and gasoline prices agree that several reasons explain it: a rising dollar pushes commodities lower; weak employment numbers from the U.S. Dept. of Labor reflect slow economic recovery --little change in consumer demand-- while tensions have eased between Iran and Western nations over the country’s nuclear program.
However, it may be premature to say that those tensions will remain muted. Last week Israel Defense Minister Ehud Barak made a speech to the Foreign Press Association in Jerusalem where he said the following:
"Iranian deception and lies concerning their nuclear program have been on-going and well-documented. Yet parts of the world, including some politically motivated Israeli figures, prefer to bury their heads in sand."
"A military option is not a simple one. It will be complicated with certain associated risks. But a radical Islamic Republic of Iran with nuclear weapons would be far more dangerous both to the region and, indeed, to the whole world."
Iran’s second round of negotiations with the U.N. Security Council’s ‘P5+1’ group (U.S. Britain, France, Germany, Russia and China) is scheduled for May 23 in Baghdad. EU countries have already cut imports of Iranian crude and Iran is now storing its oil in a fleet of 14 very large crude carriers (VLCCs), each loaded with about 2 million barrels of oil, which are anchored and acting as floating storage. Reuters says that most of the tanker fleet has turned off their transponders in order to avoid detection.
And more tankers are on their way. Chinese shipyards are reportedly delivering the first of 12 supertankers this month to Iran, two months ahead of the July sanctions that are supposed to make it difficult for most countries to engage in oil commerce with Iran. The 12 VLCCs will increase Iran’s tanker fleet from 39 to 51.
Maybe that’s why Barak said the sanctions, to date, have merely “forced the Iranians to take note, to sit down and to talk. The P-5+1 engagement of Iran, however, does not fill me with confidence. I may sound pessimistic, but the State of Israel cannot afford to be duped."
The U.S. cannot afford it either. If evidence of Iran’s uranium development for nuclear weaponry is to draw us in to a conflict, it had better be indisputable.