-- Posted Thursday, 2 March 2006 | Digg This Article | Source: GoldSeek.com
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As a preface, the Iranian Oil Exchange will not set up shop in March 2006. The exchange for Central Asian energy product sale, will not go into operation, will not come to pass, at least not anytime soon, and certainly not this month. My reliable sources traceable to London tell me that Iranian mullahs and clergy entrenched in high office have decided they do not wish to relinquish their corrupt siphon from vast energy sales into their personal accounts. Some old leaders have stolen and wish to continue to steal from their people, from their national energy deposit treasure. The launch of the Iranian Oil Exchange (IOX) will not succumb to Western pressure, will not back off from a challenge to the Petro-Dollar. The IOX will not happen because certain influential Moslem Iranian leaders wish to continue their pilferage, still brisk as each day passes. A formal exchange would force their ruling class to abide by rules of law, official transparency requirements, and that aint gonna happen. Some cock & bull story will be forthcoming as to feasibility or prepared facilities or whatever, so as to save face. To be sure, Iran will continue to sell energy products, and will likely not store the proceeds from those sales in USDollar denominated securities. The diversion away from US$-based assets will continue.
The fact of the matter is that TopDog Ahmadinejad is at odds with the old-line leaders, who continue to push forward a sequence of energy ministers beholden to the old guard. Ahmadinejad wants more honesty and openness in their national leadership, and more acceptance internationally among the community of nations. This initiative has led to several rejected candidates in charge of public administration for the national energy business. Ironically, the new guard in Iran is more dogmatic, reactionary, and impractical, replete with impolitic calls for the destruction of Israel, unwise removal of astute previous foreign ministers in service who had constructive relationships abroad. However, at the same time the new guard is at serious odds with the old guard, who want continued unfettered access to billion$ in oil money. Former leader Rafsanjani has embarked on a speaking tour across the nation, spreading the message “the new regime has gone too far” interestingly. Too many among former Shiite clergy leaders are corrupt, have established a lucrative lifestyle of Moslem bourgeois, and have decided they want to keep their hands in the energy till. In defiance of their own people and Koran, they care to keep their personal accounts in Switzerland and Tokyo and Hong Kong untouched and intact. In this respect, they differ little from the Saudi royals or other Persian Gulf sheikdoms.
For those quick to judge, a story of financial corruption has dogged almost every single US President or his Cabinet after Eisenhower. Our path is littered with presidents who were corrupt or asleep on the job, if not prone to some pathetic economic mythology used by power brokers to pilfer the USGovt coffers or fatten personal investments from the military complex. Both political parties are easily accused. No details will be catalogued. Graft, corruption, and duplicity might be the shared trait across most government elite gangs and henchmen, the common human thread.
The term “Krystal Nacht” refers to the event in Nazi Germany in Nov1938. Windows from countless shops and libraries were broken, as the “Night of Broken Glass” was etched into history. Jewish books were burned in bonfires, as broad persecution began and was widely encouraged by authorities. It also marked the beginning of the wider European campaign which resulted in World War II on that continent. Neighboring nations were overtaken and occupied, with initial maneuvers to secure energy supplies, like coal mines in Poland and oil fields in Romania. The Reichstag (German Parliament) fire in Feb1933 was used as an excuse by the Nazis to demand that members of parliament pass immediately a law giving Hitler emergency powers. Many historians believe the Nazis set fire deliberately to their own state building. This enabling act gave Hitler dictatorial powers. In effect, the law was suspended and afterwards, the law became whatever the Nazis said it was. The Nazis built concentration camps hastily to house perceived traitors, communists, unionists, and other undesirables. Hitler made many grand mistakes, like invading Russia on the road and politicizing his intelligence apparatus at home.
In the United States in Sept2001 our nation suffered the attack on the World Trade Center and on the Pentagon. The hastily hatched Patriot Act was passed as legislation by the US Congress in the months following the attack on US soil. Over two thousand Americans died in the combined attacks just four years ago. At least the United States has no internment camps, detention camps, or concentration camps, or do we? The stated justification for Nazi aggression, both domestically and internationally, was to quell the supposed Jewish conspiracy. The terrorist threat to the United States is based far more based in reality. More accurately, naked Nazi aggression was to manifest expansion like any totalitarian state would. In the course of World War II, up to two thirds of the entire world oil supply was exhausted, destroyed, or depleted. Wow! What a toll in addition to millions of human lives and some beautiful cities! At least my parents met in a London bomb shelter. War always pushes commodities into a bull market. War is beneficial for the price of both crude oil and gold. Anyone who expects an inflationary depression alongside war needs to examine the history books for a precedent. There are none.
Of more immediate concern is the crystallizing event in Iraq last week. The destruction of the Shiite Askariya shrine in Samarra (a Sunni city 60 miles north of Baghdad) in my view serves as the Krystal Nacht in the Iraqi Civil War. Sectarian violence has spread throughout the nation. Reports have caused a certain mild trembling within me. A strange parallel strikes me with the Spanish Civil War in the 1930 decade. Iraq is on the brink of civil war, which might more accurately be depicted as a broadening of the civil war already in progress, an upward ratchet in its intensity.
QUESTIONS & FORECASTS
My purpose is not political. My dislike and disrespect is evenly balanced across political parties in the United States, as little competence has been detected, and images of reckless cowboys appear justified. So many extremely abnormal and questionable positions, analyses, and events have been scattered in the last nearly three years of war prosecution in Iraq. Major questions are begged by past and present chaotic events. Was a deal cut with Pakistan not to capture Osama Ben Laden? Given the strong fervent devotion to Osama inside Pakistan, and their military dictatorship with Mushareef, and their possession of the nuclear bomb & technology, what exactly was the deal cut with Pakistan? Perhaps no capture in exchange for no nuke shared with Al Qaeda? A perverse deal might explain why the final capture of Osama was farmed out to Pakistani forces when he was surrounded in Tora Bora. Would the war on terrorism in the USA be a hard sell if Osama were captured or killed? Would one billion Moslems erupt worldwide in violence if Osama were captured or killed? Tenet and Bremer were given the Presidential Medal of Freedom award. Do the criteria these days to earn the highest civilian medal center on deception or valor, or perhaps securing oil? A burning question remains. As the US Intelligence nucleus shifted under the executive branch from its longstanding independent status, has its independence been comprised politically?
Disinformation can be found in numerous corners. Truth is said to be the first casualty in war, how true! The United States has embarked on a grand challenge to install democracy in Iraq, to render toothless the Baath party of evil despots, and to turn that economy back on track in a healthy constructive fashion. Oil fields have been repaired and remediated. Pipelines have on occasion been targets for explosive attacks. Port facilities have to date largely been spared from attack or destruction. Contrary to plan or promise, crude oil has more than doubled in price since spring 2003. Nevermind the claims that Iraq owned weapons of mass destruction, which never passed my smell test, not from the start. If you want some WMD, check cruise missiles, painted smart bombs, stealth bombers, not to mention the Council of Economic Advisors and the US Treasury Bond which together victimize the USEconomy and its citizens.
Let’s not overlook the comedy from the wartime public relations initiative on the financial and economic aspects, which would make Johnny Carson’s old “Tonight Show” envious of the material.. We were given some truly absurd promises, like how increased Iraqi oil production would pay for the war itself, which made me howl in laughter (Congress bought it)… like how the crude oil price would decline toward $20 per barrel, which brought more laughter amidst doubled investments in energy stocks (Wall Street bought it)... like how only minimal Congressional financial safeguards would be necessary, which ensured in my mind vast fraud like the missing $15 billion from the war funding (major oil service firms love it). Then there were the incorrect forecasts, whose cost is in a human toll… like how US soldiers would be universally welcomed, which brought images of body bags to my doubtful mind… like how the war would be very quick, which conjured images of years of occupation, insurgency, bombings.
My reactions were based upon history books from the failed Roman Empire occupation of Iraq, the failed English subjugation of Iraq in the 1920 decade, and more recently the failed Soviet occupation of Afghanistan. Resistance is innate and inherent to Moslem people and culture, especially from the Mesopotamian and Afghan regions. Besides, Moslems do not cotton to foreigners, especially Christians. A college roommate of mine was once on an Ethiopian mission to build water supply systems, until he awakened to see a knife in his dead friend’s chest one morning, with an inscription “infidel” on it.
DATELINE IRAQ, FEB 2006
This past week on February 22, 2006, the Shiite shrine of Askariya was bombed and destroyed. What the fabulous St Peter Square is to Roman Catholics (tomb of Simon Peter), this shrine is to Shiites, the tomb for two leading imams in the Mohammed line dating back to the ninth century. Violence has erupted throughout Baghdad and three neighboring provinces. In the last two weeks, violence has extended to the southern Basra port and its mosques, over 300 miles south of Baghdad. No group has claimed credit for the attack to Askariya. Sectarian opposition is the default blame, but more sinister motives are highly likely, such as the Baathist seculars or Al Qaeda attempting to stir up civil war between Shiites and Sunnis. A guess of Israel might contain a strong motive, since an Iraqi Civil War would deny Iran a satellite Shiite Fundamentalist Republic in Iraq.
If not glass, then certainly many relics were shattered and broken in those shrines. Two days of extreme violence ensued. The toll to date is at least 10 clerics murdered, over 200 cited attacks, and over 370 people killed in total. This is by far the most serious shrine bombing, but not the first such incident. Countless scattered bombings, explosions, murders, and general mayhem have occurred in the last week alone. In the months immediately after March 2003, scattered destruction was witnessed on certain key lesser shrines. Furthermore, scattered assassinations were committed against key clerical leaders in 2003. With the latest destructive ruin of Askariya, the much anticipated civil war might have begun. Calls by USGovt leaders to rebuild the sacred mosque seem empty and off the mark. See the photos before and after.
In Iraq, four major groups can be identified as factions. The secular Baath party (not religious in nature) include the former ruling members, from which Hussein and his henchmen came, plied their trade, plundered the nation, and exacted torture. The Sunnis are the more moderate conservative Moslems, whose central shrines lie in Mecca and Medina inside Saudi Arabia. The Shiites are the more radical Moslems, whose ties are more linked to Iran. The final group is the splinter non-Arab group of Kurds in the north, resident to Iraq as a result of boundaries made long ago by outsiders. The Kurds have more a mix of Central Asian and Turkish blood. Say whatever you would like about Saddam. He was evil personified, a human pig, a Hitler replica who preferred to stay home. However, he might have served as glue to hold Iraq together. Remove Saddam and Iraq might have reverted to an unstable tinder box or powder keg as we currently witness.
Similarities to Vietnam are valid in my view, but the Iraqi Civil War contains two additional lethal dimensions, those being religion and oil. Religion and politics aside, conflict is explosively favorable for commodity prices for supply reasons. Concurrently, conflict is explosively favorable to the gold price for geopolitical reasons. Exit plans seem nowhere in sight, which attests to either ineptitude or desired permanent war. How is the democracy experiment working out?
DATELINE SAUDI ARABIA, FEB 2006
In the same week as the destruction of the main Iraqi Shiite mosque, a foiled attack occurred at the largest oil processing facility in Saudi Arabia. The Abqaiq Oil Facility survived two truck bombs at entry checkpoints, resulting in the deaths of two valiant Saudi security officers. Al Qaeda has claimed credit for the attack, but not for the Iraqi Shiite shrine attack. No functional damage was rendered to the Abqaiq site. However, more importantly, notice has been served, and the leviathan target has been publicly identified. The greatest Saudi oil facilities have been targeted. Worse, the timing is suspicious, as though the Iraqi attack and the Saudi attack might possibly be coordinated in some way. Perhaps these two events are unconnected. Perhaps they are the work of an unidentified sinister force hellbent on destabilizing the region. If attacks should succeed on oil fields, oil processing centers, oil pipelines, oil ports, oil tankers, gasoline refineries, or passageways through the Straits of Hormuz, the world will suffer. The effect on the price of crude oil and gold will be magnificent, profound, and enormous. WE ARE ON NOTICE – MAYHEM IS NEAR. THE CRUDE OIL PRICE (AND GOLD) WILL SURELY RESPOND FAVORABLY.
The recent attacks on Saudi soil serve as only the latest in a string of violent episodes. In May2003, three grand explosive attacks marred the Saudi landscape. Foreign workers employed in their vast petrochemical industry were the intended target, as a deterrent for ongoing Western cooperation. Foreign engineers were abducted and beheaded. Al Qaeda violence doled out on Saudi soil is a thought pulled from a fairy tale few could imagine back then. The Saudi government received a wake-up call almost three years ago. They have reacted responsibly and effectively. They have made headway in offering amnesty to rebels, in giving counsel to young men on reckless paths of suicidal madness, in beefing up their security. Improved security might not be possible, not really, too little too late, much like stopping the ocean tide or a sand storm. The CIA calls it “blow back,” a natural consequence by human societies to expel outsiders who attempt to control a nation as with puppet strings.
SHIITE VS SUNNI SECTS
For those curious about the two competing sects of Islam, be sure to know the schism is far deeper than simple Catholic versus Protestant. It is not only racial, but at the heart of gentility, forgiveness, meekness, hostility, attitude, and demeanor. Sunnis are almost uniformly Arab. Shiites are predominantly Persian, whose ancestral ties are to Western Asia, not Arabia. Historically, Shiites believe in a line of succession like a monarchy, from imam to his son as with kings. Shiites have mullahs, imams, and when suitable an ayatollah. Shiites in my opinion revere like a sacrament the practice of revenge and bloodletting, and revere warriors as much as prophets. Sunnis believe in election of religious leaders through consensus agreement, like with the Vatican pope. Sunnis in my opinion thrive more on compromise and forgiveness, but they do have a history replete with treachery and violence. To be sure, the Wahabbi movement among Islam is so radical fundamentalist in its interpretation that the Sunni versus Shiite alignment might not be relevant. Their root teachings trace back to before the two-part split.
Wars between Shiite and Sunni date back to the fourteenth century, plenty of bad blood still. In the 1990 decade a foiled attempt by Shiites to destroy portions of the fabulous giant Mecca or Medina shrines resulted in their capture, and swift execution by sword, via beheading. Call them old-fashioned. Inside Iraq, clerical leaders called mullahs (like priests and ministers) have in recent years been shot dead in numerous assassinations, only to ignite sectarian conflict. Iraq claims between 60% and 65% of its population to be Shiite. A parliamentary Iraqi Republic is considered likely to evolve into a Shiite Islamic Republic. USGovt influence might be trivial to prevent it. Such warnings were dismissed from the start.
The world of Christiandom is not immune from controversy, corruption, stupidity, legal wrangling, and warring. Heck, we are human too. Young men who died in the Crusades to liberate Jerusalem centuries ago were promised instant salvation, not too far from the lunatic promises given to Islamic suicide bombers for both salvation and multiple virgins. The Islamic promise seems a better deal. The similar schism occurred in the sixteenth century, led by Martin Luther (a huge hero in my book) with his posted 95 charges on the Wittenburg church door, known as the Protestant Reformation. He objected to influence peddling with deity, money for salvation and indulgences (blessings). The Spanish Inquisition in the fifteenth century was horrendous and shameful, ostensibly to purify the national faith, but more likely an attack on diverse faiths such as Moslems and Jews.
English King Henry VIII battled with the Roman Catholic pope over divorce, resulting in numerous wife beheadings, the murder of Thomas Moore, and the creation of the Anglican Church. A full century of wars involve the English versus Irish to pit Protestant versus Catholic. Terrorist violence was doled out by the Irish Republican Army, which included the murder of Mountbatten, numerous London subway bombings, and fund raising in Boston. The IRA has been at peace in recent years.
For a cast of crazy characters, see Oral Roberts (who claimed God would strike him dead if certain funds were not raised), Jim & Tammy Faye Baker (basic fraud and adultery), Pat Robertson (calls for Chavez assassination in Venezuela). We have constant battles over “separation of church & state,” an uncertain stretch of heavily debated Constitutional tenets, revisited annually over holiday nativity scenes on public squares. Hotly debated issues pertaining to women and homosexuals in the clergy, abortion, stem cell research, divorce, marriage by Catholic priests, at times resulting in violence, deaths, and imprisonments. See the parade of costly lawsuits against the Catholic Church for molestation by priests across the Western world. Thorny matters involve the clergy on political participation, yet untaxed religious status. We are not immune to contentious controversy or violence or lunatic fringe types in the religious community. North America might boast its own Wahhabi lunatic fringe types, based in certain unnamed heretical groups as well as White Supremacist and Ku Klux Klan enclaves. Their scale, however, does not compare to the Madrassas schools in Islam.
By the way, my background is half Irish, the rest English and German, raised Catholic, now non-denomination (apolitical) Christian. The Catholics were brutal to me in school (thus the attitude) but they taught me very effectively. Their women enjoyed slapping my face when talked back to. Their men were hardly good role models for adaptation in society. Some were fine scholastic teachers, others were good sport coaches, while some were basic perverts.
IRAQI CIVIL WAR
The Countdown to Energy War is no longer a countdown. THE ENERGY WAR HAS BEGUN AND NOW ENCOMPASSES AN IRAQI CIVIL WAR. In my view, Moslems finally have their Krystal Nacht in the destruction of Iraq’s most important Shiite shrine at Askariya. Whether you care about Islam or not, this is a revered shrine deserving respect. How would Roman Catholics react if the St Peter Basilica were destroyed, sacked, and razed? Watch the Medina and Mecca shrines inside Saudi Arabia for retaliation. My purpose is to heighten attention of a civil war in Iraq, its trigger, its possible proliferation (not global, not yet), and to examine the effect on the price of gold and crude oil.
Civil war in Iraq is not considered to be even remotely on the list of benefits to any group except those who might wish for a “perma-war” condition. It is curious how democracy is sought in Moslem lands, yet any history of constructive consensus rule is totally non-existent, and any precedent of a constitutional parliament is also absent. Egypt has a parliament, but no constitution, which would by nature compete with or conflict with the Koran, a point missed by USGovt leaders and the US Congress. Even in the quasi-democratic Egypt, the opponent to Mubarek was assassinated last year. Not much was reported on the incident in the intrepid, sleepy, lapdog US press & media. Perhaps they did not wish to expose how impracticable democracy was even in the most favorable environment among Arab nations.
It might be useful to analyze the movement on the chessboard, to forecast the effect on the price of crude oil & gold, and to anticipate the effect on financial markets from both investor reaction and official liquidity. A broad civil war in Iraq will lead to a skyrocket in the price of crude oil and gold. Safe passage through the Hormuz Straits to the Persian Gulf is of the utmost importance. WE ARE ON NOTICE – MAYHEM IS NEAR. THE CRUDE OIL PRICE (AND GOLD) WILL SURELY RESPOND FAVORABLY.
Once again, we have benefited little from recalling, let alone studying history. We used to criticize the Soviet Union for “revisionist history.” Ignoring history or putting forth arguments which fly in the face of history might be equally primitive. The British and French carved up the old Ottoman Empire following World War I in order to establish national boundaries known to Iraq today. Ten years of bloody war, and 100 thousand deaths forced England into retreat. Dictators held together the uneasy factions inside Iraq for decades, leading to Saddam Hussein, the grandson of a Grand Mufti Husseini who served as a general under the Nazi German Army. The Mufti’s assignment in WWII was to purge (as in genocide) SouthEast Europe of Jews in the predominantly Moslem region. The release of the Mufti from a Paris prison was part of a deal struck by England, France, and the USA in order to pacify regional factions opposed to the creation of Israel as a nation in the war aftermath. Backroom deals are part of politics. Some occur to this very day, not to be debated in the US Congress, like perhaps the US Ports deal with the United Arab Emirates and their govt-owned Dubai Ports World. Watch closed door sessions be the order of the day, then a railroad of approval along political partisan lines.
One can argue that Iraq has never been at peace since Iraq was created after WWI. A brutal war lasting ten years ensued between Saddam and the Ayatollah Khomeini during the 1980 decade. Reports of nerve gas usage were rampant, along with perhaps a million lost lives. That war was complicated by border claim disputes, as the river Shatt al-Arab through Basra shifted with each passing year. The city of Basra claims many people of Iranian ancestry. The Islamic Republic of Iran displaced the Shah of Iran (another Western created abomination) and his peacock throne after a revolution. The puppet-like Shah ensured strong Western ties, for diplomacy, oil sales, and banking deals, as he replaced the dictator Mosadec in Iran. The Shah Ministry of Security secret police was named Savak, every bit as brutal and violent as the Nazi Gestapo, whose reach stretched to Europe in practicing their craft. A tidbit factoid, the largest collection of Iranian expatriates exists in Los Angeles, many of them multi-millionaires.
The lesson of Yugoslavia was lost on USGovt leaders. The benevolent beloved Marshal Tito held together uneasy factions among seven provinces. When he died, the horrendous Balkan Wars followed. A strongarm dictator, whether good or evil, might be required to apply the glue necessary to keep the tenuous union together. Saddam is likened to Tito, although malevolent in his tight regime and the object of numerous assassination plots. Deposing Saddam Hussein is undoubtedly a good thing. However, unlike Manuel Noriega of Panama, Saddam will sound off in his court trial, quite the spectacle charade. We might all hear juicy secrets, but nobody will believe him. Still, their first major display of justice seems at first blush to be a carnival. My suggestion is to have Saddam given the death sentence before a military tribunal, even if a cursory trial, then executed by ten thousand cuts, doled out by the Iraqi citizens. One cut per person would be permitted by small knives in an endless single file until his final breath and demise. At sundown each day, he would be cleaned up, bandaged, and be given access to face Mecca for prayers. The next morning, resume the parade of executioners. The nation needs the community satisfaction sense in his execution.
Saddam broke ranks and instituted financial cracks of instability with the US$ superstructure in the Petro-Dollar system. He sold crude oil in euro terms. During his rule, the Persian Gulf was unstable, marred by the Kuwaiti occupation, ending with the annihilation of the Iraqi Army, and the torching of the Kuwaiti oil fields. Red Adair was kept as busy as a one-armed wallpaper hanger quenching the fires, but outside that, few benefits. The US Military oust of Saddam and takeover of the Iraqi nation offered some hope of stability and responsible effective rule, but eruptions were more predictable from deep underlying tectonic shifts. Warnings of destabilized Iraqi factions, warnings of incompatible democratic reforms with Islamic law & customs, and warnings of the morph of Iraq into an Al Qaeda magnet for terrorism, insurgency, and mayhem were all ignored or minimized. The Askariya Krystal Nacht mosque bombing has changed perceptions, and altered the outlook on the Iraqi Reconstruction. EVERYTHING HAS NOW CHANGED. CIVIL WAR IS HERE. EXPLOSIONS LIE AHEAD FOR THE PRICE OF OIL AND GOLD.
Once last year, a simple yet alarming graphic crossed my path, one not retained. It graphed the number of violent attacks and bombings in Iraq over the many months since March 2003. The trend is up. Look for that trend to accelerate. Worse, look for the murder of clerics to accelerate, which in my view is the heart and continued lit fuse of any sectarian civil war. No longer will simple oil pipeline bombings suffice in the eyes of those who have embarked on an escalated level of violence. By occupying Iraq, the United States Govt has implicitly invited a regional response. We have seen some evidence of regional response, mostly manifested in the energy world. See the Iran oil pipeline winning the Central Asian petrol contest. See Russia turning off natural gas spigot to Ukraine. See the numerous gigantic energy contracts and military contracts between Iran and both China and Russia. See the energy contracts won by China in Kazakhstan. The other violent response is unmistakable, a military response from growing insurgency inside Iraq. Decades of perceived resentment are in the process of being addressed, payback for the harsh rule of a dictator. The Kurds might be the only winners in a civil war, to win the independence of a Kurdistan. However, such an independent state would earn the resentment and counter-measure by Turkey. Some critics claim after all these centuries, we might have revisited the revival of the Crusades. The prize is not Jerusalem, but rather the Persian Gulf oil fields and preservation of its Petro-Dollar foundation. This marks an implied bidding process for oil fields, pushing up the crude oil price. With the messy bidding process of war comes a bidding process for gold as a refuge, as in all wars.
EFFECT ON OIL & GOLD
With no limits, come a new set of targets. Nothing is off limits. The implication to the crude oil price is direct, from lost supply. For over a year it has been clear that the crude oil price honors not only supply & demand concerns, but also delivery in the equation. As Russian President Putin likes to say “power lies with control of energy above ground.” The “what if” scenarios become mindboggling. We have first-hand experience with the impact of oil pipeline explosions and disruptions from terrorist attack on the oil price. The word “disruption” seems inadequate, and might yield to “decimation” someday. What will be the prevailing oil price if the Abqaiq Oil Center is shut down and under repair for four to six months? What if a single oil tanker is sunk in deep waters of the Indian Ocean? What if a single oceanic oil platform is destroyed by explosives, not weather? What if a gasoline refinery is destroyed via bomb attack? What if a critical port facility is destroyed and obliterated? The implications extend to other tankers, to other oil platforms, to other refineries, to other port facilities, and leave open far too many potentials. What if the Straits of Hormuz are closed from a sunken vessel? If a provocation and incident occurs, can we be certain what happened? One must wonder. Against a background of scattered disinformation, one can be a quantum level more certain of rising commodity prices. WE ARE ON NOTICE – MAYHEM IS NEAR. THE CRUDE OIL PRICE (AND GOLD) WILL SURELY RESPOND FAVORABLY.
If any dire scenario plays out, we will see $100 oil, and a $100 lift in gold per month. Given the path we find ourselves on, the dire scenario seems less an uncertainty, and more just a matter of time unless the players (leaders) change. Terrorists have decided to interrupt the supply of oil to the West. Shortages will surely be felt throughout this decade. My conclusion has been clear. In 2005, Wall Street in their self-serving style got the crude oil forecasted price wrong, mostly for weather and depletion reasons. Wall Street in 2006 will get the crude oil forecasted price wrong, mostly for geopolitical reasons. Events are hurtling forward with a reckless acceleration except in slow motion. The Askariya bombing and the near Abqaiq bombing are timed as opening acts prior toward a deadly sequence of crescendos. The mixture of financial weapons and conventional military weapons will be revealing, shocking, and prevalent from here onward. Get out your bicycles and urban rickshaws. Install anti-virus software on your computers.
One objective in Iraq was to take the battle to the back yard where Al Qaeda comes from. Closer to home in our Western Hemisphere, armed conflict might be a sneeze away between the United States and Venezuela. We are at odds over their disruptive influence from Bolivia to Colombia. The entire network of Citgo gasoline stations is owned by the national Venezuelan petroleum company. The nation run by strongarm Chavez also supplies diesel, heating oil, and crude oil to the United States. Unlike Saddam, but like the USGovt president, Chavez was installed as president after a popular election. Venezuela has the ability to seriously cripple the USEconomy, and he has threatened to do so. In the balance lies reliable supply of both crude oil and refined energy products, the sale of oil in euro currency transactions, even respect over Hillary’s virtue. Is this woman a modern day Helen of Troy??? NOT!!! Helen moved a thousand ships. Hillary might only move a thousand chips, whether of the potato variety or casino type.
Lastly, the list of nations either planning (secretly or stated) to sell crude oil in euro denomination grows by the month. There is Russia, the quiet bear, which goes about its agenda, with or without consent or blessing. There is Syria, a minor player, but symbolically important as an Iraqi border nation, probably involved in the assassination of a popular Lebanese leader. There is Venezuela, with plenty of entertaining bluster, but more talk than action. There is Iran, a giant in the game with incredible complications in the same swipe (of pen or of sword) with nuclear and anti-Zionist calls. Now there is Norway. The USDollar is being outflanked not on one front, but on at least four fronts. The global economy offers a far more complex fabric being stretched and torn. The current situation seems far more dangerous than the Cuban Missile Crisis under Kennedy. The entire world has been swimming like frogs in a slowly boiling kettle, desensitized. Given the cultural ignorance and disdain for Islam and its shrines, few seem sufficiently alarmed even after its Krystal Nacht event. Oy oy oy.
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-- Posted Thursday, 2 March 2006 | Digg This Article | Source: GoldSeek.com