Iranian Oil Exchange
                 …Declaration of War?

Oil - Currency Warfare in the Middle East
Comlinks.com

Washington, DC - Aug 11th, 2005 -- One of the reasons that the Bush/Cheney Administration claimed that they were concerned about Saddam Hussein was that Iraq was "reconstituting its nuclear weapons program." However, another more likely reason is that Saddam had announced in the Fall of 2002 that Iraq would be selling its oil in Eurodollars as opposed to US dollars. Fast forward to the US invasion of Iraq in March 2003 and look at the military debacle that has developed courtesy of the Pentagon and the Bush/Cheney Administration's foreign policy.

All of a sudden its the summer of 2005 and we are hearing about Iran's nuclear capabilities and the potential danger to the United States. Haven't we seen this movie already? Don't we already know how it ends? The US has played its military hand for all the world to see. Russian must have a smile the size of Siberia. China must be grinning from one end of the Great Wall to the other.

So here we go again....current geopolitical tensions between the United States and Iran is not so much about the stated concerns regarding Iran's nuclear intentions, but more likely include a proposed Iranian "petroeuro" system for oil trade. Just like with Iraq, military operations against Iran have more to do with the trading oil in euros and the economic challenge to the US and less to do with Iran's suspected nuclear facilities.

This military adventure into Iran is not going to sit well with either Russia nor China for any number of reasons, th first of which both countries have significant energy infrastructure investment and trade deals signed with Iran. Secondly, Russia is itself evaluating the 'petroeuro' option with the European Union. Finally, in addition to Russia and China other members of the U.N. Security Council from E.U. nations such as France and Germany would likely veto any Bush/Cheney use of military force without solid proof of Iranian evidence in a major terrorist attack.

A unilateral military strike by Bush/Cheney on Iran would isolate the US in the eyes of the world community, and it is conceivable that another military adventure such as Iraq could provoke those other nations to strategically abandon the US dollar as a means of economic warfare. As a matter of fact, such an event would create pressure for OPEC or Russia to move towards a petroeuro system in an effort to cripple the US economy and its global military presence.

Even going a step further than Saddam, Iran is about to commit a far greater "crime" in the eyes of the US and the UK when it announced a eurodollar conversion AND an oil trading exchange: Beginning in March 2006, the Tehran government has plans to begin competing with New York's New York Mercantile Exchange (NYMEX) and London's International Petroleum Exchange (IPE) with respect to international oil trades that essentially becomes an Iranian oil -currency exchange using a euro-based international trading "marker."

The proposed Iranian oil exchange signifies that the euro would establish a firm foothold in the international oil trade, unless of course, the US (military) intervenes.
What is most concerning, and by far the most troubling, was an article in The American Conservative by intelligence analyst Philip Giraldi. His article, "In Case of Emergency, Nuke Iran," suggested the resurrection of active U.S. military planning against Iran – but with the shocking disclosure that in the event of another 9/11-type terrorist attack on U.S. soil, Vice President Dick Cheney's office wants the Pentagon to be prepared to launch a potential tactical nuclear attack on Iran – even if the Iranian government was not involved with any such terrorist attack against the U.S.:

The Pentagon, acting under instructions from Vice President Dick Cheney's office, has tasked the United States Strategic Command (STRATCOM) with drawing up a contingency plan to be employed in response to another 9/11-type terrorist attack on the United States. The plan includes a large-scale air assault on Iran employing both conventional and tactical nuclear weapons. Within Iran there are more than 450 major strategic targets, including numerous suspected nuclear-weapons-program development sites. Many of the targets are hardened or are deep underground and could not be taken out by conventional weapons, hence the nuclear option. As in the case of Iraq, the response is not conditional on Iran actually being involved in the act of terrorism directed against the United States. Several senior Air Force officers involved in the planning are reportedly appalled at the implications of what they are doing – that Iran is being set up for an unprovoked nuclear attack – but no one is prepared to damage his career by posing any objections.

Why would the Vice President advocate a possible tactical nuclear attack against Iran in the event of another major terrorist attack against the U.S. – even if Tehran was innocent of involvement?

The very same answer emanates from why this Administration seemed so intent on removing Saddam Hussein: the desperate desire to maintain U.S. economic supremacy.

Economically, what is happening here is that support for oil traded in US Dollars, as opposed to Eurodollars, is falling off a cliff. Should the purchase and sale of oil move from trading in US Dollars to Eurodollas, it forces present and future US Administrations to significantly change its current tax, debt, trade, and energy policies, all of which are severely unbalanced. The US Dollar, as the global currency of choice - as now implemented - is what makes the corporate oligopoly succeed.
In mid-2003 Iran allowed for oil payments from certain EU customers to the euro, and in June of 2004 announced its intentions to create an Iranian oil currency exchange market, resulting in an oil currency exchange market in direct competition with NYMEX and the IPE. Needless to say, the powers that be at the London International Petroleum Exchange and the New York Mercantile Exchange did not take that so well as both the IPE and NYMEX are owned by a U.S. consortium of big energy players.

The complete absence of coverage from the mainstream media in the US only hides the main fact that one of the Federal Reserve's nightmares may begin to unfold in the spring of 2006. It is at this time that international purchasers of oil would have a choice of buying a barrel of oil for $60 dollars (for example) on the NYMEX and IPE - or purchase a barrel of oil for €45 - €50 euros via the Iranian exchange.

Of course, this assumes the euro maintains its current 20-25% appreciated value relative to the dollar and that Bush/Cheney and their friends at the Pentagon don't go hunting for nuclear weapons in Iran..

The new Iranian oil exchange marketplace would introduce the "petrodollar vs petroeuro" currency war and fundamentally new dynamics to the biggest market in the world - global oil and gas trades.

Why is this so detrimental to the US? Alan Greenspan and the Federal Reserve will no longer be able to drop an endless supply of credit via U.S. Treasury bills, and the global demand for US Dollars will fall off the cliff. Why is this so important? Because China and Japan would have much less economic interest in purchasing US dollars and treasury securities in order to keep our economy afloat.

The global financial community is dependent on the oil and gas energy supplies found in the Middle East. Therefore, the OPEC and Non-OPEC nations would likely move together on the currency exchange markets in an effort to mitigate another economic and military maneuver from the Bush/Cheney White House. Any efforts that resulted in a dollar currency crisis would be undertaken to prevent further unilateral warfare by Bush/Cheney and its potentially destructive effects on the critical oil production and shipping infrastructure in the Middle East.

Barring a U.S. attack, and it's still early yet, it seems probably that Iran's euro-denominated oil trading exchange will open in March 2006. Logically, the most appropriate U.S. strategy would be to compromise with the EU and OPEC towards a dual-currency system for international oil trades. But US foreign policy is not being represented by logical, rational people.

And that is why Iran is in the news these days.