Patrick Henningsen 21st Century Wire January 5, 2012

All signs coming out of Washington, London, Paris and Tel Aviv are pointing towards a pre-emptive military strike against Iran in 2012. But a number of key indicators are also pointing towards an unsuccessful, unlikely operation, whose failure could result in a military and economic tailspin from which the United States and Israel are unlikely to recover. Currently, the US is following a trajectory of past unsuccessful empires that were unable to sustain themselves resulting in an eventual collapse from within. The US is currently running up a budget deficit which is not only threatening to bankrupt its entire economy, but also threatening the hegemony of its sole instrument for advantage and influence on the world stage – the US dollar. Any threat to the supremacy of the dollar is also a threat to the empire. No moral mandate For centuries, even Rome required a moral mandate as it conquered the known world. As was the case with the Iraqi invasion and occupation in 2003, the West and its Axis powers led by Washington will require a multi-nation coalition backed by some form of moral mandate in order to move forward with their plans. Previously, a US-UK campaign against Iraq’s alleged weapons of mass destruction was waged through the UN, and was sufficient at the time in achieving a minimal sway in public opinion needed from both the American and British people, justifying their governments’ foreign policy goals enough to get the war off the ground. But the cost in 2012 of pushing forward under false pretences with both Afghanistan and Iraq in 2003, means that the Axis coalition powers have already played their best hand under the current social democratic system. It is clear now, after multiple failures by the UN’s IAEA to implicate Iran in developing nuclear weapons that a moral mandate is not there, so despite the best efforts of the hawks and FOX News, there cannot be the sway in public opinion needed to move forward militarily. The only remaining technique available to trigger a military conflagration is a false flag attack orchestrated by either the US, Israel or the UK, whereby Iran can be blamed for firing the ‘first shot’. The war has already begun As far as the Islamic Republic of Iran is concerned, the war has already begun. US-backed sanctions imposed against the Central Bank of Iran have been put into effect, even though no proof has actually been presented to the UN justifying such a pre-war move. But sanctions are still the first step in a physical war. The result of the Axis open abuse of the UN’s Security Council resolution process, a number of influential nations have already announced their disregard for these US-backed sanctions. This week, South Korea has announced that despite the White House’s wishes, it will still be buying roughly 10 percent of its crude oil from Iran in 2012. China is also defying the US call for sanctions, stating it will ‘resume its existing trade relationship’ with Iran this year. In 2012, China plans to make Iran its no.2 oil importer, adding to an already existing relationship worth approximately $30 billion per year. The West are in no position to challenge China over Iran at present. This means that the Axis powers will struggle to keep anything near an air-tight international mandate. They may hurt Iran in the short-term, but in the long run, such sanctions will have no teeth. The cost to America and Europe of dragging out this ‘war of words’ The most likely outcome in the first part of 2012, is the West dragging a war of words via press briefings and imperial rhetoric. An increasingly media savvy Iran will naturally follow suit, winning favour at home as the underdog in this imperial clash. The result is a war of the words in the media. But even the cost of this ‘posturing war’ to the US and Europe may be too much to bear at this time. Even the threat of an attack on Iran will automatically drive oil speculators to push up the price of oil futures, which will in turn raise the price of oil at the pump at a time when Western businesses and consumers can hardly afford it. And this series of events is already in motion. The Strait of Hormuz is the world’s busiest oil shipping lane, with 17 million barrels of oil per day passing through. Iranian announcements this week stating they will not only defend their territorial waters, but retaliate by closing the Strait’s shipping lanes if it’s attacked by the US or Israel – have already driven up the global price, with the price of Brent Crude jumping another $5 today to an eight-month high of $111.65 per barrel. CNN reported this week:

Oil prices surged 4% Tuesday, fuelled by continued anxiety over Iran’s growing threat to shut down the Strait of Hormuz after the Iranian military launched a missile test. “It’s mostly about Iran right now,” said Peter Beutel, analyst with energy risk management firm Cameron Hanover. “That’s the most bullish factor.” Oil prices jumped 4.2% to settle at $102.96 a barrel. That’s the highest closing price since May 10, when prices ended the day at $103.88 a barrel.

The picture gets progressively worse as the US-Iran face-off continues into 2012. Business Insider released a report today detailing a likely scenario whereby barrel costs skyrocket to $150:

Managers of the Guinness Global Energy fund have warned of an oil price spike to $150 per barrel if Iran were to carry out its threat of closing the Strait of Hormuz and blocking 15% of global oil exports. “The exports transported through the Strait of Hormuz are equivalent to two Saudi Arabia’s or two Russia’s, so the potential impact on the price is massive. We do not think this will happen but we cannot rule it out completely.”

Cash windfall for the oil industry OPEC oil producing Gulf nations led by monarchies Saudi Arabia, UAE, Kuwait, Qatar and Bahrain, will certainly benefit financially from any initial UN sanctions as well as any protracted stand-off between the West and Iran fueled by hype, with speculation driving up the price of oil, allowing the producer nations to effectively printing money overnight. GCC foreign companies and joint ventures include Aramco, Harken Oil (Bush family company), Texas Oil, Union Oil of California, and a host of others. Distributors and retail winners include the likes of Exxon, Royal Dutch/Shell, BP, Chevron, Getty, Phillips,  Texaco, Mobil, Occidental/Gulf and Amoco. Each of these transnational oil refiners, distributors and retailers can expect a cash windfall and a rise in their all-important share prices, but more importantly, the current crisis will be an opportunity for this cartel - to fix a new, higher price at the pump. Even if the stand-off were to climb down between the West and Iran, and the price per barrel were to somehow drop back below $100, this cartel of oil companies will still work to maintain a new higher overall pricing standard at the pump. Past price relationships between barrel price and pump price will verify this cartel practice. The economic implications, particularly on American and European economies which relies so heavily on petroleum to distribute and deliver staples like food and other day-to-day goods – could be horrific, instigating a wave of inflation on an already inflation-battered US consumer. Likewise, such a crisis will have a negative effect on the value empire’s holy grail – the US dollar. A spike in US prices will also trigger-off that old predictable debate during the coming 2012 US  Presidential election cycle – over lifting any moratoriums on domestic oil drilling within the United States (drill baby, drill). If any are lifted, again, it’s yet another win for the oil industry and its shareholders. Risks involved in a regional conflict For a perspective of the Libyan model of intervention, NATO is unlikely to involve itself in a large-scale military operation in Iran. It would prove too costly from both economic and political standpoints. Neither the US or Israel has engaged in a bona fide naval conflict in decades. In the case of the US, owner of the world’s largest navy, its last true naval military affair was WWII. As Great Britain painfully discovered during its costly Falkland Island War adventure, even one rudimentary French-made Exocet Missile launched by Argentina below radar, was enough to not only cripple a major piece of its naval fleet, but also enough of a black eye to nearly derail majority public support for their ill-conceived war effort from the opposition and back-benchers home in London. Similarly, the Iranian defense has the capability to sink not one, but many US Naval ships currently flexing their muscles on the periphery of Iranian territorial waters. Such an event would register with shock and horror in the US public mind, but worse, may be used by Washington hawks to justify a revenge nuclear strike against Iranian civilians. Both Washington and Tel Aviv have already raised the talking point of deploying “tactical nukes” against Iran. Such foreshadowing should not be ignored, as it is often a clear indicator of things to come. Any nuclear conflagration by the US or Israel would most certainly result in a global backlash against the West – at its worst acting as a procession into the hot stages of World War III – or at its very least, re-balkanizing the geopolitical scene into a New Cold War, with the West on one side and Iran, China, Pakistan, and Russia on the other. Watch author Patrick Henningsen in this segment from Al Jazeera’s program Empire: Targeting Iran, as analysts spec out potential wargames between the West and Iran: GCC becomes a target Another factor seldom mentioned by vocal proponents of regime change in Iran, like Hillary Clinton and neocon war hawks in Washington, is that any attack on Iran will most certainly mean that all US allies in the region will become a potential target. This means it is unlikely that those wealthy and developed GCC countries would remain untouched by a conflict happening only a mere hundreds of miles away. Neither would nearby major US military installations in Iraq, Qatar and Afghanistan. All are likely targets in a hot Iranian conflict. Petrol monarchies like the UAE (most notably Abu Dhabi and Dubai), Kuwait and Qatar currently rely heavily on a high standard of living and complete domestic security and stability in order to survive as societies. These fragile petrol monarchies rely on a very thin veneer of law and order – one which props up their marketing image of a luxurious “Middle East destination”. Any Iranian retaliation against these fragile US allies would result in a massive flight of persons, ex-pats and financial capital from the GCC to much safer havens – like Europe, the US, or Singapore. If there is to be a war, it will be the US, UK, France, Israel and their allies who will do the fighting. But the GCC would still need to defend itself from reprisals. In December 2011, the United States announced a $3.48 billion arms deal with the UAE, which included state-of-the-art THAD missile defense systems, as part of a wider American effort to build up missile defenses among Gulf allies to counter Iran. In addition, the US and Saudi Arabia signed a $1.7 billion deal earlier in 2011 to boost the country’s Patriot missiles and Kuwait purchased 209 GEM-T missiles at a cost of $900 million. This regional missile defense strategy will need land-based interceptors to knock out incoming missiles, backed up by a detection network aboard a team of US Navy Aegis-class warships. Although these are significant acquisitions on the part of the GCC, they are by no means blanket protection from an Iranian retaliation, and are most likely the result of America’s arms industry, in its honored tradition, bleeding the GCC of cash with yet more expensive hardware, a hard sell based on fear and war hype. Taking all this into account, and noting the incredibly concentration of wealth in the GCC, it’s hard to see a scenario where the monied interests would tolerate such a risk to their progressive Arabian project that they have spend decades investing in and building from scratch. Post-Bombing Blowback Aside from the GCC risk, it is with near certainty that one could predict a full-scale regional backlash, and genuine uprising around the Muslim world should the US or Israel come good on their threats of a pre-emptive strike against Iran. Iranian civilian deaths could not be avoided, and hence, their would be a blood price to pay by the West in the eyes of many Muslims. Such a pan-Arab uprising would stretch US and Israel capabilities in the region past their ability to maintain control of the situation. The results for Israel could be dire in such a scenario, and it’s only expected that a tit-for-tat would spiral into a long regional conflict. The West’s best chance to weather such a storm would be to overtake, or set up a military base in either Lebanon or Syria in order to neutralize traditional Iranian ally and Israeli opponent – Hezbollah – currently based in Lebanon. Without wiping out Hezbollah’s military capabilities, Israel cannot safely move forward with a unilateral/US attack on Iran. The time table for such a Syria or Lebanese take-down would put any possible attack on Iran well into late 2012, or even 2013 and beyond. A Giant Dirty Bomb If the US or Israel were to hit any of the said Iranian nuclear facilities or reactors, it has the potential to become a giant ‘dirty bomb’. In such a scenario, the civilian deaths could exceed 1,000,000 and a radioactive fall-out would certainly spill over into the surrounding US clients like Afghanistan, Saudi Arabia, the UAE, Qatar, Iraq, Kuwait and possibly as far as Israel/Palestine, Turkey, Georgia, Pakistan, India and parts of southern Europe. Following such a radiological event, the West would certainly be blamed for any and all environmental damage and death which occurs, resulting in a massive loss of international face, followed by massive financial reparations which would ultimately cripple their already weak economies. Worse than this however, it would certainly throw the global economy into a long economic depression. Most sane analysts would agree, this is a risk too high, and a price too high to pay. So the real question remains then, are analysts in Washington and Tel Aviv sane enough to make policy decisions? An Israeli driven effort Like previous AIPAC campaigns to hit Iraq, the current drive to isolate and demonize Iran has been cooked up in the Israeli lobby’s kitchen. Due to a revolving wheel of campaign contributions to each and every US Congress and Senate candidate, ‘putting Israel first’ has become a top priority for any politician with any ambition in Washington. If any official steps out of line and criticizes Israel, AIPAC functionaries like the ADL and SPLC are sprung into action and a PR campaign is usually waged against the offending public official. The Israeli lobby will claim that a pre-emptive strike on Iran is needed because Iran has stated that it wishes to, “Wipe Israel off the map”. Most war hawks would be surprised when they learn that such words were never actually spoken by Iran’s President Mahmoud Ahmadinejad. Shouldn’t this revelation change the entire Israeli perspective? It should, but it doesn’t. Regardless of any evidence to the contrary, the lobby and its media partners will continue repeating their faux version of the event as if it were something that actually happened, or spelled a genuine threat to the physical state of Israel. Likewise, US politicians will in turn acknowledge the lobby’s version of events, themselves repeating the very same faux threat – as if this somehow justify plans for a pre-emptive strike on Iran. What is most important here again, is that at no point during any of this political maneuvering, could either the US, or Israel produce any compelling evidence at all that Iran has, or is near possessing a nuclear weapon in their military arsenal. Even if they could fabricate such evidence to start a war, there are simply too many pieces out of place on the grand chessboard right now to indicate an imminent attack on Iran in the spring or summer of 2012. So far, however, the clear winner is the oil industry and the OPEC nations, winning a shift in wealth from the global middle class into the hands of petrol monarchies and oil company shareholders.