Kangaroo court of sanctions verdict: War

 Iran vs US
  (Image from: The Nation.com)

Add another log (or two) to the fire. India, Russia, Turkey, China, Japan, South Korea and now Pakistan and Australia are all continuing to trade with Iran despite US sanctions passed on through on December 31, 2011. A similar set of sanctions was set in place by the European Union on January 23 of this year. This resulted in a move by Tehran to stop sending crude to both Brittan and France.

Iran, who is a member of both the Nuclear Non-Proliferation Treaty and International Atomic Energy Agency feel they should be able to pursue Nuclear power for domestic purposes, whether that is true or not is anyone guess and is totally irrelevant, as far as we are concerned here in the states.

As we have heard ad nauseam, the sanctions were put on Iran based on their developing nuclear weapons program going online and posing a threat to destabilize the region. Iran says it’s for peace, the US doesn’t believe them and because of that, the west led by the US, continues to escalate toothless sanctions on Iran.

Iran has taken a progressive approach to combating sanctions from the West, thus the new sanctions put in place on New Years eve 2011 come across as a either a gross miscalculation by our intelligence (where have we seen this movie before) or our State Department (again, same movie, same script… different actors) in dealing with the supposed weakness or Iran; its inability to make enough Gasoline.

Tehran has used multiple tools to soften the blow of sanctions well in advance. First, there was the 2007 Gasoline Rationing Plan put into place by President Ahmadinejad. Three years later, in 2010, came a massive reduction of subsidies on gasoline, resulting in a quadrupling of price overnight across the entire nation of Iran, prices went from 0.38 cents per gallon to $1.44.

All the while, Iran’s dearth of refining capacity (that the sanctions were thought to have been targeting) and the need to import 40% of their gasoline was being addressed and dramatic changes were being implemented. Iran has spent and will continue to spend billions on modernizing their current refineries while putting into motion the building of seven new refineries. As a contrast, the  US hasn’t built a new refinery in 36 years (that plays a big role at what you pay at the pump).

Here we have Iran looking to build seven refineries in the next few years. This will not only allow them to supply their own oil, it was also give them more economic freedom as they will not have to subcontract out the refinery process of raw crude to other gulf nations. Iran went from importing 40% of its gas five years ago to now just 5% coming way of importation.

With all this development and concentration on energy independence; Iran is posed to be a net exporter of Gasoline by 2015. That is a rather dramatic turnaround in just a few years time and a testament to the Iranian’s diligence and prudence on addressing their achilles heal.

Let’s get back to that script and movie theme once again. It was the buildup in 2002 to the Iraq invasion that the US (after multiple sanctions on Iraq and refusing anything outside of the fact that Iraq had WMD’s) went to war to hold up UN sanctions despite that fact that the UN never approved of the war in the first place. Then, shortly after the invasion, the script was flipped to “giving the citizens democracy” or “freeing them from a big mean dictator”. Or was it that “he supported terrorists”? I can’t remember the order for excuses as they were then, as they are now, in dealing with the new posterboy for dollar interference… totally irrelevant.

The bottom line is this. We go after them with sanctions and they ultimately don’t work. There is only one other alternative; Iran will get a taste of what both of its neighbors got. Like Iraq, this isn’t about Nuclear weapons. It is about oil. However, above all, this is about protecting the petrodollar. Iran has made all the right moves and either we are severely underestimating them or it’s just a big dog and pony show for the inevitable. Either way, regardless if its Obama or Romney or Santorum… Iran is next.

4 comments to Kangaroo court of sanctions verdict: War

  • Silver Shield

    Saddam was about selling oil for euros.
    Gaddafi was about selling oil for gold dinars.
    Iran is about the petro dollar dying.

    What I don’t get is why countries like Iraq, Libya, and Iran push the issue with the trigger happy MIC?

    Play along sell the oil for dollars only then dump those dollar buying gold, silver, or other real commodities they need.

    It has the same effect without the threat of invasion.

    Trying to push this mortally wounded beast off the cliff is not necessary.

  • Andy in the UK

    It is interesting that Russia has increased (rather than recalled) the number of ‘technicians’ and ‘advisors’ currently in Iran.
    I also find it interesting that Russia has sent – as overtly as possible it would seem – a significant number of ‘technicians’ along with various high-end monitoring and radar equipment to Syria (who are being, shall we say, ‘watched over’ by the very capable Russian submarine group believed to be ‘monitoring’ NATO vessels in the Med).

    It does appear that Russia has drawn at least 2 lines in the sand with respect to overt military action by NATO against Syria and Iran.

    At least the Russians and NATO have proved to be sensible and restrained (predictable even) when it comes to ‘tensions’, however the wild cards/possible black swans in this seem to be Israel, China, and Pakistan (and possibly even India).

    Also, as all interested parties are also nuclear powers, it is my oppinion that we may get lucky with this one and avoid an actual shooting war (mysterious explosions at various Iranian facilities excepted). Every party stands to loose too much if things get nasty.

    I will expect to see lots of bluster and lots of provocations, but not much in the way of killing. I hope I am right for once.

  • Fletchlives

    That is a question i think to myself as well. Knowing the US is debt ridden and must continue to finance its entire economy through debt, War is a vehicle for that to happen, plus this strategically puts us in a good place as far as oil is concerned.

    Iraq i think was getting out of the petrol dollar out of spite. We helped him in his coup, we helped him with the war with Iran, he hated terrorists he loved American culture… and he goes into kuwait and we turn on him like a rabid dog. Then we put insane sanctions on him basically crippling his nations population. He couldnt update his army either so that im sure was a thorn in his side… the petrodollar card was all he had to play. I think he underestimated us putting boots on the ground as well.

    Libya? I dont know what he was thinking. We let him dangle for decades, and then he just felt the need to stick it to us. That is a tough one.

    Iran i feel thinks they are a superpower. They have oil and they have many in the east relying on it, i think they feel protected. Iran is merging too. I think thats a bad thing for them as it will only spark our desire to get them before they really start growing.

  • Fletchlives

    Andy, i agree. It appears Russia has definitely drew some kind of line in the sand with Syria. I suppose thats why we havent went in or had NATO do it. We have full support from the Arab League to do so. Other then Iran, Syria has no regional allys would would interfere. They seem ripe for the picking. Russia is itching for something i think. I would assume Russia would be more then happy to partake in a proxy war there, a little redemption for Afghanistan eh? Lets hope it doesnt get ugly. The US has been pretty bold these last 20 years with its aggression, sooner or later we are going to bite off more then we can chew.

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