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Gold9472
02-04-2006, 02:34 PM
The name of the Game

http://www.dailypioneer.com/columnist1.asp?main_variable=Columnist&file_name=ganguli%2Fganguli17.txt&writer=ganguli

(Gold9472: Good article.)

2/4/2006

An Islamic bomb in the volatile West Asian theatre is a spectre frightening enough to unite the entire international community, in this instance against Iran. Of course, the country with the single greatest worry on that count is Israel, given Iranian President Mahmoud Ahmadinejad's call to wipe out the Jewish nation. For India too, although Iran remains a friend, an Islamic bomb sans American supervision, unlike Pakistan's, is not a comforting thought. And the United States of course has 27 years of enmity with Iran to contend with.

To that extent, Iran's referral to the United Nations Security Council was a foregone conclusion from the moment Tehran's nuclear credentials came under the global scanner last September. With a reluctant Russia and China eventually coming around, it became that much easier for the UN nuclear watchdog, the International Atomic Energy Agency (IAEA), to agree to place Iran under the Security Council's surveillance.

But why is it that the Americans encountered far less resistance from global leaders when they attacked Afghanistan? How did the United States Army manage to bombard its way against international opinion into the streets of Baghdad in an apparent hunt for weapons of mass destruction which, even the most indifferent Iraqi observer knew, did not exist? Why is Washington categorically ruling out a military option against Iran, a key member of President George Bush's "axis of evil", while hoping that negotiations would obviate even the need for sanctions?

In a nutshell, why, despite the strongest convictions about Iran's clandestine nuclear weapons programme, does the international community, from the United States downwards, continue to treat Tehran's intransigence with kid gloves?

Simple. The name of the game is oil. Iran is neither a war-lorded Afghanistan nor a dictator-driven Iraq, two economically devastated societies waiting to implode the moment their regimes were displaced. Iran is a cohesive society with a democratic political process in place, is the world's fourth biggest oil exporter and the second largest producer of crude oil. Admittedly, Ahmadinejad's inflammatory comments on Israel, his open defiance against the Americans and his regime's publicly declared nuclear ambitions have made it difficult even for Iran's long-term trading partners and allies like Russia and China to openly defend it. However, competing oil interests in the region have ensured that the IAEA is still keeping the doors of negotiations open - this, in the face of the gravest of provocations from Iran.

As the nuclear game unfolds and leads up to March 6 when the IAEA director-general submits his report to the Council, it is not difficult to imagine why Ahmadinejad adopted such a tough posture. On the domestic front, a relative newcomer to the Iranian political scene, the new President wants to signal to his people that he is the messiah of Iran's new face in the 21st century as the political and military leader of the Islamic world.

That Ahmadinejad's desire to establish his country's supremacy against powerful competitors like Saudi Arabia may be icarian, is the subject of an altogether different debate. In the current context, it is Iran's impressive hold on the oil market that is orchestrating responses across world capitals and is preventing Washington from unilaterally cornering Tehran, a fact Ahmadinejad is supremely conscious of.

It is a game the Americans have successfully played out through the Afghanistan and Iraq wars. Those wars gave America access to Central Asia and the Caspian Sea's oil. US troops are present in Kazakhstan and Uzbekistan to protect this oil which accounts for 26 percent of the world's reserves and the US holds the sole key to this oil. It has a presence in Georgia which forms a crucial segment of the pipeline connecting the Caspian Sea with the Black Sea and the Mediterranean.

An oil-and-gas pipeline going through Kazakhstan and Turkmenistan, under the Caspian Sea on to Georgia and Turkey to the Mediterranean does give the United States supreme control of the region's oil. In effect, the larger American gameplan is to control all Gulf oil and render Europe, Russia and Asia completely dependent on it for their energy needs.

Aware that Iran is the only connection to Afghanistan but has a regime the US can little trust, the Americans have been planning to descend on the region. Therefore, Bush's frequent proclamations of Iran being part of an axis of evil that needs to be militarily demolished. Except, the global context has changed significantly since the world was asked to line up "with us or against us" by Bush.

Also, this time around the oil stakes of global powers like Germany, France, Britain, China and Russia in Iran are far more formidable for the Americans to deal with, a reason why the US is finding it extremely difficult to have its conventional way of forcing an invasion. In fact, energy politics is being played out in an intricate and orchestrated manner in Iran, something Bush may not have factored in when he gave his clarion call for evil's destruction in 2002.

Back then, September 11 had nudged even the worst of America's critics into looking at the Islamic world with suspicion. Several countries across the globe had been combating their own share of terrorism, so an American resolve to deal with the menace seemed God-sent. Four years and two wars down, both disasters, world capitals have become a wee bit sceptical of American rhetoric which best serves that country's own interests, be it regarding terrorism or oil.

Today, Bush does not have the widely sympathetic global audience he did when he declared in 2002: "States like these (Iran, Iraq and North Korea) and their terrorist allies, constitute an axis of evil, arming to threaten the peace of the world. By seeking weapons of mass destruction, these regimes pose a grave and growing danger. They could provide these arms to terrorists, giving them the means to match their hatred. They could attack our allies or attempt to blackmail the United States. In any of these cases, the price of indifference would be catastrophic." In Iraq's case, action has proved to be catastrophic; despite the Afghanistan war, Osama bin Laden roams a free man; North Korea has indicated the limit to which the Americans can go; and, Ahmadinejad is no Saddam.

In concert with this changed international context is the question of oil. Given the world's voracious and growing energy appetite, oil holds the key to global control in the 21st century, a key the United States has been passionately chasing for the last three decades. However, Russia and China are now out to stymie this American dream of energy hegemony, aided by the European Union's quest to gain a substantial currency foothold in the international oil market, hitherto dominated by the dollar.

Reports in the West Asian media suggest the United States has real cause to worry in Iran's case, not so much because of nuclear weapons but because of a far more potent weapon - Iran's plans to hit the dollar through its proposed Iranian oil bourse where it will start pricing its oil in euros, a move expected to deal a devastating blow to the US currency.

International oil is largely traded in dollars which places the currency in the highest demand worldwide. Iran's plans to explore an alternative exchange naturally has the blessings of the European Union, a reason why European countries are resisting possible imposition of sanctions on Iran - which could well render Iran's oil market a pariah. If Iran opts for a euro-based exchange in oil, it will get the European currency in as a legitimate competitor to the dollar and make it an alternative means of international transaction in oil.

This, then, is the context in which Iran's referral to the UNSC must be seen. Iran is indeed seeking to establish its supremacy in the Islamic world but not in the way a bin Laden is. Iran is sitting on an energy treasure trove which gives it a supreme edge over Islamic fundamentalists who have only jihad to fall back on. Iran is indeed a serious threat to the United States but not in the way the Al Qaeda is - it is a threat to American oil interests in the region.

It is this capability that had driven a wedge in international opinion on whether to send Iran to the Security Council. Even now, Iran is far safer from sanctions than other designated "rogue" countries which have been subjected to such referrals in the past. Tehran knows it has the potential of seriously impacting global oil prices if placed under sanctions; that is a ground reality the Security Council, especially the United States, will keep in perspective while deciding Iran's fate.

Good Doctor HST
02-04-2006, 03:56 PM
"Reports in the West Asian media suggest the United States has real cause to worry in Iran's case, not so much because of nuclear weapons but because of a far more potent weapon - Iran's plans to hit the dollar through its proposed Iranian oil bourse where it will start pricing its oil in euros, a move expected to deal a devastating blow to the US currency."

International oil is largely traded in dollars which places the currency in the highest demand worldwide. Iran's plans to explore an alternative exchange naturally has the blessings of the European Union, a reason why European countries are resisting possible imposition of sanctions on Iran - which could well render Iran's oil market a pariah. If Iran opts for a euro-based exchange in oil, it will get the European currency in as a legitimate competitor to the dollar and make it an alternative means of international transaction in oil.



This is the exact same move Venezuela wants to make; to move from trading in U.S.D. to euros. If both Iran and Venezuela pull this off, it spells doom for an already-doomed U.S. economy. Expect both nations to use this as a negotiating tool