If You Wondered Why Energy Independence Is Important

The Wall Street Journal posted an article yesterday about the drone attack on Saudi oil fields. The Iran-allied Houthi rebels in neighboring Yemen have claimed credit for the attack.

The article reports:

The production shutdown amounts to a loss of about 5.7 million barrels a day, the kingdom’s national oil company said, roughly 5% of the world’s daily production of crude oil.

Officials said they hoped to restore production to its regular level of 9.8 million barrels a day by Monday. Energy Minister Prince Abdulaziz bin Salman said lost production would be offset through supplies of oil already on hand.

The strikes mark the latest in a series of attacks on the country’s petroleum assets in recent months, as tensions rise among Iran and its proxies like the Houthis, and the U.S. and partners like Saudi Arabia. The attacks could drive up oil prices if the Saudis can’t turn production back on quickly and potentially rattle investor confidence in an initial public offering of Saudi Aramco, the national oil company.

The article concludes:

The Yemen war is a central front in a new and more aggressive foreign policy overseen by Prince Mohammed, who launched the intervention with a coalition of allied states in 2015. Under the prince’s watch, the kingdom also applied a blockade on neighboring Qatar, detained Lebanon’s prime minister, and sent a team of men to kill exiled journalist Jamal Khashoggi in Istanbul in 2018.

A conservative kingdom with a Sunni Muslim majority, Saudi Arabia has been an opponent of Iran in a struggle for power across the broader Middle East since the 1979 revolution that toppled Iran’s monarchy.

The attacks on Aramco’s facilities are poorly timed for Aramco’s coming IPO and pose a challenge to oil officials after a changing of the guard in their leadership. Aramco last week picked seven international banks to help it list on Saudi Arabia’s domestic exchange, an IPO that could value the company at about $2 trillion dollars and come before the end of the year.

There are a lot of things going on behind the scenes here. This is part of the conflict between Sunni and Shiite Muslims. At their core, both the Saudis and the Iranians want to bring back the former caliphate. The Ottoman Empire (which was that caliphate) existed until the early 1900’s. Many Muslims want that Empire restored. The argument is over who will rule the caliphate when it is established. Al Qaeda and the Muslim Brotherhood are players in this conflict, as is ISIS. Jamal Khashoggi was a part of the Muslim Brotherhood. Descriptions of him as simply a journalist were misleading. Another part of this puzzle is the fact that Saudi Arabia is drawing closer to aligning with Israel because of the fear of a nuclear Iran. That also would be a cause for increased aggression from Iran.

Generally speaking, any terrorism that goes on in the Middle East can be traced back to Iran. They have been training and funding terrorists since the Iranian Revolution in 1979.

I have no idea what impact this will have on world oil prices. I do know that Saudi Arabia will work to repair the damage as soon as possible. I have no doubt that Iran is violating the sanctions on its oil exports, so if the price of oil rises significantly, Iran may be able to pull itself out of its current economic difficulties and calm its population. America will continue to prosper as oil prices rise because we are now a net exporter of oil rather than a net importer. Because of the policies of President Trump, we are in a very different situation than we were during the oil crisis of the 1970’s.

Dealing With A Country Whose Economy Is Collapsing Is Not Unlike Dealing With A Cornered Animal

The sanctions placed on Iran by the United States have created severe economic problems for the country. The people of the country are being hurt by the sanctions, the rules are still doing quite well due to black market dealings. A rebellion is brewing. The rebellion will probably be successful if the sanctions continue. The rulers of Iran know that and are trying almost anything to make the sanctions go away. Thus, the recent seizure of oil tankers in the Strait of Hormuz.

One America News posted an article today with the headline, “Britain weighs response to Iran Gulf crisis with few good options.”

The article reports:

Britain was weighing its next moves in the Gulf tanker crisis on Sunday, with few good options apparent as a recording emerged showing that the Iranian military defied a British warship when it boarded and seized a ship three days ago.

Prime Minister Theresa May’s office said she would chair a meeting of Britain’s COBR emergency response committee on Monday morning to discuss the crisis.

Little clue has been given by Britain on how it plans to respond after Iranian Revolutionary Guards rappelled from helicopters and seized the Stena Impero in the Strait of Hormuz on Friday in apparent retaliation for the British capture of an Iranian tanker two weeks earlier.

Footage obtained by Reuters from an Iranian news agency on Sunday showed the tanker docked in an Iranian port — with Iran’s flag now hoisted atop.

The British government is expected to announce its next steps in a speech to parliament on Monday. But experts on the region say there are few obvious steps London can take at a time when the United States has already imposed the maximum possible economic sanctions, banning all Iranian oil exports worldwide.

“We rant and rave and we shout at the ambassador and we hope it all goes away,” said Tim Ripley, a British defense expert who writes about the Gulf for Jane’s Defence Weekly.

“I don’t see at this point in time us being able to offer a concession that can resolve the crisis. Providing security and escort for future ships is a different matter.”

A day after calling the Iranian action a “hostile act”, top British officials kept comparatively quiet on Sunday, making clear that they had yet to settle on a response.

“We are going to be looking at a series of options,” junior defense minister Tobias Ellwood told Sky News. “We will be speaking with our colleagues, our international allies, to see what can actually be done.

“Our first and most important responsibility is to make sure we get a solution to the issue to do with the current ship, make sure other British-flagged ships are safe to operate in these waters and then look at the wider picture.”

Seizing a ship in international waters is an act of war. The question is, “What are the western countries going to do about it?” War with Iran is not really a good idea–it’s what the rulers want–feeling that a war would unite the country. We have in the past used military escorts through the Straits of Hormuz. I suspect we will be doing so again. The good news is that America is energy independent and can help dilute the impact of the difficulties in getting oil through the Strait of Hormuz. Meanwhile, I am hoping we have some cyber experts that could make the life of the Iranian rulers a little more difficult.

The Death Of An American Hero

Yesterday NPR reported that Tony Mendez, the man behind the 1980 rescue of six American diplomats trapped in Iran by the Iranian revolution, has died. The six diplomats were hidden by the Canadian Embassy until the CIA was able to smuggle them out of the country. The story was the basis for the movie “Argo.” The full story was not really told until the movie was released in 2012.

The article at NPR reports:

Tony Mendez became a legend inside the CIA with his daring 1980 rescue of six American diplomats who were given shelter by the Canadian Embassy in Tehran after the U.S. Embassy had been stormed by Iranian revolutionaries.

But the “Canadian Caper” remained classified for nearly two decades, and Mendez didn’t receive full acclaim until the Oscar-winning movie Argo, came out in 2012, with Ben Affleck portraying him.

Mendez, who was 78 and had Parkinson’s disease, died Saturday at an assisted living facility in Frederick, Md., outside Washington, according to the International Spy Museum, where Mendez was a founding board member.

“He was a legendary intelligence officer,” said the museum’s Executive Director Chris Costa.

The movie tells the story of how Tony Mendez posed as a film director with a crew scouting locations in Iran for a movie. He then gave the diplomats phony identities as part of his crew and smuggled them out of the country as his film crew. The crew flew out on a commercial airline. It is an amazing movie, and Mr. Mendez deserves a tremendous amount of credit for pulling off the scam. He was a true American hero.

What A Difference A President Makes

Investor’s Business Daily posted an editorial today about recent events in Iran. The editorial highlights the difference between the way the Obama administration handled protests and the Trump administration is handling protestors.

The editorial states:

In recent days, headlines such as “In Iran, revolution is starting in the bazaar,” “Clashes Continue in Iran for Third Day After Grand Bazaar Merchant Protest,” and “Tehran’s Grand Bazaar Shut Down As Economic Protests Spread,” have run in global media, with little apparent notice.

It’s a big deal. A very big deal.

The 39-year-old dictatorship of the Mullahs in Tehran may be on the verge of dissolving, as Trump imposes new, stiff sanctions on Iran’s economy and Iran’s currency, the rial, plunges sharply, prices soar and the economy collapses. Average Iranians are losing faith in the government and taking to the streets.

In dealing with Iran, it is important to remember the demographics of the country. A large segment of their population was killed during the Iran/Iraq War between 1980 and 1988. The current profile of the Iranian population is 24.1 percent under the age of 15, 70.1 percent between 15 and 64 years old, and 5 percent of the population 65+. That means that the twenty year olds who participated in the Iranian revolution now comprise 5 percent of the population.

According to unc.edu:

A scholarly article based on the records of the Veteran and Martyrs Affairs Foundation, a government agency, recently counted 183,623 Iranian deaths as a result of the war.

To put that into perspective, Iran had a population of 80.9 million people in 2017.

The majority of the population has grown up in a very restrictive culture and  does not necessarily supported the rule of the mullahs. The current economic struggles have only exacerbated the discontent of the majority of young Iranians.

The editorial states:

Tehran’s Grand Bazaar, its central meeting place and business center, has been filled with tens of thousands of angry protesters nearly every day. Yet, the media are paying little attention. Neither are average citizens in the West. But it bears close watching.

Some chant anti-government slogans, including “The enemy is here. They (the regime) lie that it is the U.S.” Not lost on average Iranians is the fact that, as Najmeh Bozorgmehr writes in the Financial Times, “The bazaar played a crucial role in the 1979 Islamic revolution when traders joined forces with the clergy to overthrow Shah Mohammad Reza Pahlavi.”

Is history repeating itself?

If so, this will remake the entire Mideast. Without the fundamentalists in power, Iran will almost certainly begin modernizing both its economy and its culture. Moreover, the nuclear weapons program that is at the heart of western discontent with Iran could be dismantled.

Last time, the U.S. sat and watched, not giving its ally, the Shah, any support. This time is different.

The U.S. Treasury under President Trump has already begun to revoke licenses, according to the Associated Press, that let U.S.-controlled foreign companies sell commercial jet parts and oilfield gear to Iran. It also bans sale of Iran’s famous carpets, pistachios and caviar in the U.S., major exports for the financially troubled nation.

This follows Trump’s decision in May to pull out of President Obama’s so-called Iran nuclear agreement. That deal didn’t halt work on a nuclear weapon; it merely postponed an Iranian nuke by 10 years.

Despite criticism from Britain, China, Russia, Germany, France and the European Union, Trump held fast. Angry rhetoric notwithstanding, foreign banks have fallen into line, fearing sanctions from the U.S. Two-thirds of all global trade is conducted in dollars. As sanctions bite and its oil industry struggles, Iran’s mullahs are short on cash.

By these moves, Trump has empowered the people taking to the streets in Tehran and elsewhere. The last time this happened, during Iran’s 2009 “Green Revolution,” by comparison, President Obama did nothing. Indeed, within years, Obama had signed a Neville-Chamberlain-style appeasement deal Iran’s leaders. Disgracefully, it basically gave them a sure path to a nuclear bomb.

This protest is important. It could eventually change the face of the Middle East.

The Election Is Already Making A Difference In How We Deal With Iran

According to The Daily Signal, on Thursday the House Republicans passed a bill blocking the sale of aircraft to Iran.

The article reports:

The House voted 243 to 174 to pass legislation sponsored by Rep. Bill Huizenga, R-Mich., prohibiting the secretary of the Treasury from authorizing a transaction from a U.S. bank or financial institution related to the export of aircraft to Iran.

The White House said it would veto the bill, as it could be viewed as a violation of the Iran nuclear deal.

In September, the Treasury issued licenses to aviation giants Airbus and Boeing that permitted the sale of planes to Iran Air, the country’s state-owned airline. The agency also allowed U.S. banks to finance the sale of those aircraft to Tehran.

“This bill would keep Americans’ deposits away from a country that the president’s own State Department calls ‘the foremost state sponsor of terrorism,’ and which Treasury has designed as a ‘jurisdiction of primary money laundering concern,’” Huizenga said today on the House floor.

The legislation also prohibits the Export-Import Bank, or Ex-Im, from providing any assistance either directly or indirectly to Iran and associated entities, including its state-run airline.

Ex-Im provides taxpayer-backed loans and loan guarantees to foreign countries and companies for the purchase of U.S. products.

“We need to make sure that the American financial system is not complicit in this [Iran nuclear] deal,” Rep. Peter Roskam, R-Ill., said on the House floor Thursday. “We need to make sure American taxpayers are not subsidizing this deal.”

The article explains why selling aircraft to Iran is not a good idea:

The company’s deal marked the first time since the Islamic Revolution in 1979 that American aircraft were sold to Tehran.

The Obama administration previously sanctioned Iran Air after the airline used passenger and cargo planes to fly rockets and missiles to Syria and other nations. The weapons were sometimes disguised as medicine or spare parts, according to past reports.

Under the Iran nuclear deal, the Obama administration dropped economic sanctions against Tehran.

I believe that the Iran treaty will be one of the first things to go under a Trump Administration. The treaty is not a good deal for anyone–it simply allows Iran to develop nuclear weapons a few years later than the Iranian government originally had in mind. It is also obvious by the behavior of Iran since the treaty that their hostility toward America has not decreased. I suspect that one of the reasons the House of Representative allowed the treaty to stand was that the airline manufacturers made large campaign contributions to key Representatives. That is the kind of behavior that needs to go away as soon as possible.

Something Is Wrong With This Picture

PJ Media today posted an article by Roger Simon about an open letter to President Obama written by the nephew of Iranian Supreme Leader Ayatollah Ali Khamenei.

Please follow the link above to read the entire letter, but here are some excerpts:

Dear Mr. President

I am presenting this open letter as one of the serious opponents of the Islamic republic of Iran on behalf of the like-minded opposition groups and myself. Because of my knowledge of this regime, especially of Ali Khamenei who is my uncle (my mother’s brother), I see it as my duty to inform you about this regime and the issue of nuclear negotiations with the Islamic regime of Iran.

Let me at first inform you that the regime that falsely calls itself a republic came to power in 1979 by deceiving Iranian people and the world through provoking Iranian people against the regime of Mohammad Reza Pahlavi and gaining the support of the world community.

Obviously Dr.Mahmoud Moradkhani (the author of this letter is not a supporter of the current Iranian regime).

He also states:

We can find a historical example of this kind of deception prior to the Second World War. Hitler manipulated and deceived German people and European countries and the hesitation in addressing the problem with Hitler led to a great disaster.

Due to the changes in time, the domain of the disaster might become limited now but breach of human rights is the same, regardless of the number of people who become victimized in the process.

Ali Khamenei and his collaborators know very well that they will never become a nuclear power. They certainly do not have the national interest of Iranian in their mind; they just use the nuclear issue to bully the countries in the region and export their revolution and middle-aged culture to other countries. Obviously, you and European countries do not give the Islamic regime any concession unless you are certain that they comply with the agreement. The Islamic regime of Iran will certainly prolong the verification period the same way that they have delayed and prolonged the nuclear talks. It is in this period that the wounded regime will retaliate with its destructive policies.

The countless breaches of human rights violations, spreading of Islamic fundamentalism, intervention and creating crisis in the Middle East are all unacceptable and contrary to democratic and humane beliefs of yours and ours.

I would love to know why he believes that Iran will never become a nuclear power. I expect that Israel will not allow that to happen, but I am not sure that is what he means.

What we currently have in the Middle East is an all-out war between the Sunnis (led by Saudi Arabia) and the Shiites (led by Iran). The nuclear deal reached with Iran by the Obama Administration in its current form would simply fund the Shiite effort in that war. That is one of many reasons why this treaty must be kept from taking effect.

The United States Attorney’s Office Has Seized An Iranian Skyscraper In New York City

On Thursday, Fox News reported that the United States Attorney’s Office has seized a skyscraper in New York City allegedly secretly owned by the Iranian government.

The article reports:

U.S. Attorney Preet Bharara claimed that the property owner, the Assa Corporation, was nothing more than a front for the state-run bank that financed the building.

“The Judge’s opinion upholds what was the contention of this Office from outset: ‘Assa was (and is) a front for Bank Melli, and thus a front for the Government of Iran,’” Bharara said in a statement.

The building was originally erected in the 1970s by the Phalavi Foundation, a non-profit that was operated at the time by the Shah of Iran and financed by Bank Melli, which is controlled by the Iranian Government. 

After the Iranian revolution, the loan for the building was cancelled in the 1980s and ownership was transferred to Assa and the Alavi Corporation. The U.S. alleges that Assa and Alavi were shell companies set up by the Iranian regime, with the former based in the UK’s Channel Islands to launder money back to the government.

Needless to say, the Alavi Foundation intends to appeal the court’s decision.

The article reports:

The government plans to use money from the seizure to compensate victims of Iranian–sponsored terrorism.

The building is valued at between $500-700 million and recently had $11 million in improvements.

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Sued Over Argo

Argo” won the Academy Award for Best Picture this year. The film tells the story of six Americans smuggled out of Iran after the Iranian revolution. The movie is not entirely accurate–it’s a movie–but the basic story follows the history of the events (for some details on what is true and what is not, see rightwinggranny.com).

The Associated Press is reporting today that Iran is planning to sue Hollywood, claiming that the movie portrays the country of Iran in an unrealistic way.

The article reports:

The decision on the lawsuit came after a group of Iranian cultural officials and movie critics screened the film in a closed audience in a Tehran theater late Monday.

The gathering, titled “The Hoax of Hollywood,” discussed various legal aspects of filing a lawsuit, media reports said, without providing details. It remains unclear what specific charges Iran could raise and what court Tehran could turn to if the action goes ahead.

Those at the meeting dismissed “Argo” as a “violation of international cultural norms.” A statement issued after the gathering said that “awarding an anti-Iran movie is a propaganda attack against our nation and entire humanity.”

The statement did not clarify how the movie was allegedly unrealistic, but officials have accused “Argo” of depicting Iranians as “too violent.”

I have no way of knowing if the violence depicted in “Argo” is exactly what happened. I do know that there were some areas in the movie that represent the ‘poetic license’ of the filmmakers. I also know that the people who were in Iran during the 1979 revolution and the news photographs from that time indicate that the violence shown was typical of what went on.

The thing to keep in mind here is the effort on the part of the Iranian government to stop any art or speech that portrays them in a negative light. Freedom of speech in Iran died in the revolution of 1979. The violence that was depicted in “Argo” was part of that picture.

 

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The Visit That Occurred After The F-16’s Were Delivered

The Blaze is reporting today Iranian President Mahmoud Ahmadinejad has visited Egypt and met with Egyptian President Mohammed Morsi today. This is the first visit to Egypt by an Iranian leader since the 1979 Iranian revolution. The visit also occurred two days after Egypt received its shipment of F-16’s from America.

The article reports:

Though Egypt’s shifting alliances are unavoidably apparent, the United States is continuing to arm the country.  On Sunday U.S. Ambassador to Egypt Anne Patterson held a ceremony in Cairo to mark the arrival of four F-16 fighter jets from the United States.  Twenty in total are due to be delivered throughout 2013.

“Today’s ceremony demonstrates the firm belief of the United States that a strong Egypt is in the interest of the U.S., the region, and the world,” she declared.

According to the United States Embassy website, the U.S. has delivered 224 F-16 aircraft to Egypt.

It is interesting to me that the visit occurred after the planes were shipped. I really do question the wisdom of arming the present Egyptian government. This may easily be something we will regret later.

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