WarSclerotic

Iran has most to lose by closing… JPost – Iranian Threat – News.

    It would be relatively easy for Iran to make good on its threat to close the strategic waterway that carries oil tankers from the Persian Gulf — and it would probably hurt itself most by taking such action.

“Iran is as reliant, if not more reliant, on the Strait of Hormuz than any other country,” said Ali Nader of the RAND Corp. research institute in a telephone interview.
Iran has threatened to halt traffic through the strait if the West moves to toughen sanctions including an oil embargo to pressure Iran to abandon its nuclear program. The strait is the passageway for about a third of the world’s seaborne-traded oil last year, according to US Energy Department data.

“Iran has total control over the strategic waterway,” Iranian Naval Commander Admiral Habibollah Sayari told Iran’s Press TV yesterday as the Iranian navy conducted a 10-day exercise in international waters. “Closing the Strait of Hormuz is very easy for Iranian naval forces.”

“The free flow of goods and services through the Strait of Hormuz is vital to regional and global prosperity,” said Lieutenant Rebecca Rebarich, a US Navy spokeswoman in Bahrain, site of the 5th Fleet headquarters, in an e-mail. “Any disruption will not be tolerated.”

NYMEX crude oil prices fell back yesterday after rising by about 1.5 percent to more than $101 a barrel the previous day, when Iranian Vice President Mohammad Reza Rahimi threatened to close the 21 mile-wide strait if the West imposed new sanctions.

NYMEX West Texas Intermediate crude fell some 1.7 percent to $99.65 a barrel in New York, and ICE Brent Spot fell more than 1.7 percent to almost $107.40 a barrel.

Closing the waterway would harm Iran

US officials and outside experts concede that Iran could block the strait, at least temporarily. Testifying to Congress in March, Defense Intelligence Agency Director Army Lieutenant General Ronald Burgess said that Iran is expanding its Persian Gulf naval bases, allowing it to “attempt to block the Strait of Hormuz temporarily” during a crisis.

Were Iran to make such a move, it might be hurt more than its adversaries.

Iran’s economy is shaky, as is popular support for its clerical rulers, Nader said. The country is facing new Western efforts to halt its suspected nuclear weapons program, including US sanctions that are awaiting US President Barack Obama’s signature and a possible European Union ban on imports of Iranian oil.

According to the US Energy Information Administration, Iran’s net oil export revenues were approximately $73 billion in 2010; crude oil and its derivatives account for nearly 80 percent of Iran’s total exports; and oil exports provide half of the nation’s government revenue.

Iran’s best customer: China

Moreover, according to the EIA, Iran’s best customer is China, which took about 22 percent of Tehran’s oil exports during the first half of this year and is a member of the United Nations Security Council and one of the few nations on friendly terms with the Islamic Republic.

China gets 11 percent of its crude oil imports from Iran, according to the EIA, while Turkey, a NATO member that shares both a border and antipathy toward Kurdish separatist groups with Iran, got 51 percent of its imported crude oil from the Islamic Republic from January to June of this year.

In August, Iran’s Press TV reported that Iranian security forces killed three Kurdish rebels suspected of blowing up a major pipeline that carries Iranian natural gas to Turkey on July 29.

While closing the Strait of Hormuz, even briefly, would hurt Saudi Arabia, Iraq and other Gulf oil exporters, the Saudis also ship oil via the Red Sea. All of Iran’s exports and many of its imports of gasoline, food and consumer goods are shipped through the strait.

Iran’s main oil terminal at Kharg Island, which has a loading capacity of 5 million barrels a day and storage capacity for more than 30 million barrels, is in the Persian Gulf. So is its second-largest export terminal, at Lavan Island, with storage capacity of 5 million barrels and a loading capacity of 200,000 barrels per day.

Nevertheless, said Anthony Cordesman, an analyst at the Center for Strategic and International Studies in Washington, Iran’s threats to close the strait are only the beginning of what could be five to 10-years of feints, attacks and rising tensions in the Gulf.

That, Cordesman said in a telephone interview, could require the US to change its military posture in the Persian Gulf region at a time when the US is facing intense budget pressures and the Obama administration has signaled its intention to focus more attention on the Pacific.

Rhetoric or Reality?

“Closing the Strait of Hormuz is really an exercise in rhetoric,” Cordesman said. With shipping channels passing Iranian or Iranian-held islands, floating mines, small craft and missiles could halt tanker traffic or raise risk premiums so high that insurance rates alone would drive up the cost of oil or stop shipping, he said.

An all-out conflagration might be too high a cost for Iran, at least until its nuclear weapons program produces enough weapons to make a credible deterrent, Cordesman said.

“We have been through an awful lot in the Gulf, where nothing has escalated or triggered a major conflict,” he said.

“When you are raising oil prices by having tankers pay higher insurance premiums, it’s out of hand, but the question is how much out of hand,” he said. “You have to be careful in going from Iranian statements which are also aggressive to assuming we are in middle of a crisis — we aren’t yet.”

The potential worry now, however, said Nader, is that an Iran that feels threatened by tougher Western sanctions, by the uprising in neighboring ally Syria and by the broader rebellion against autocrats elsewhere could miscalculate and trigger a conflict that neither it nor anyone else wants.

IAF hits Gaza targets overnight after Kassams – JPost – Defense.

    Rocket fire from the Gaza Strip continued Thursday morning following a night that saw four Kassam rockets fired at southern Israel and an IAF strike in the central and northern Strip.

The IDF confirmed that the air force struck two targets overnight, a tunnel used by terrorists in northern Gaza and a known center for terrorist activity in the center of the Strip. Palestinians reported no injuries.

Early Thursday morning, a rocket launched from the Gaza Strip exploded in an open area of the Eshkol Regional Council. The four Kassam rockets fired overnight Wednesday exploded in the Sha’ar Hanegev Regional Council and in the Eshkol Regional Council. No injuries or damage were reported in any of the rocket attacks.

Speaking on the third anniversary of Operation Cast Lead Tuesday, IDF Chief of General Staff Lt.-Gen. Benny Gantz said that Israel will “sooner or later” need to launch a large-scale operation against Hamas in the Gaza Strip.

“I believe that the State of Israel cannot continue to live under the active threat of Hamas in the Gaza Strip,” Gantz said.

“Sooner or later, there will be no escape from conducting a significant operation. The IDF knows how to operate in a determined, decisive and offensive manner against terrorists in the Gaza Strip.”

Drumbeats of War – New U.S. Sanctions Red Line for Iran | Snafu::Blog – Disaster Emergency Supplies.

On Tuesday, Iran official English language media was talking about Iran being ‘capable of blocking the Strait of Hormuz’, while Western media was running a remark by Iranian First Vice President Rahimi: “If they impose sanctions on Iran’s oil, not even a drop of oil will be allowed through the Strait of Hormuz.” It seemed that the Iranian government was actually downplaying Rahimi’s remarks somewhat. Keeping things genteel and talking of capabilities.

Now, Wednesday morning Iran local time, official Iranian headlines are saying “Iran will choke Hormuz oil flow”, and the Rahimi remarks being reported by the Iranians are: ‘the enemies need a crushing response from the Islamic Republic to abandon their plots against the Iranian nation’. Interestingly, his actual remarks were a little milder: “Our enemies will give up on their plots against Iran only if we give them a firm and strong lesson.” The Iranian government’s tone is now utterly hardline and very, very angry… crushing and choking… rather than a firm and strong lesson. Is that splitting hairs? Don’t think so. Changing the wording indicates a conscious change of policy. And resolve.

Any more sanctions, and… if Iran’s promises are to be believed… they will take the fatal step of closing the Strait, devil take the hindmost.

Apparently the Obama administration believes them.Mainstream U.S. media is carrying the substance of ‘recent interviews’ with President Obama that say the U.S. has a plan to keep the Strait open ‘in the event of a crisis’. However, there is no current statement forthcoming from the White House. The reason given is to avoid panicking the world economic markets, and also to not give Iran the satisfaction of a U.S. response to Iran’s threat.

That looks like a semi-truth and two truths. The U.S. may have a plan to keep the Strait open, but every military planner from the U.S. Joint Chiefs of Staff to the Russian military say the Iranians can, in fact, close the Strait no matter what the U.S. does. Of course, there may be some secret something somewhere that no one knows about. But it would take either that, or something so drastic it is difficult to contemplate.

The U.S. sanctions everyone is talking about are part of legislation already passed by Congress (correction: but not yet signed by the president, although he says he will) for financing the U.S. military. BUT. The way the bill is written, the president is allowed to ‘waive sanctions’ if they ’cause the price of oil to rise or threaten national security’.

Think they just might do that?

So President Obama has a back door. Two of them, actually. He can play the economic card, or play the national security card. Either allow him to get out of jail free.

Given his track record, he may play both.

But…

That may not be enough.

The Arab League has promised to impose crippling sanctions on Iranian oil if President Assad of Syria does not, in effect, hand the country over to his opposition forthwith. That would be an intolerable blow to both Iran and Lebanese Hezbollah, not to mention Assad. Israeli sources with Mossad and military connections are saying there is a military force made from former Libyan ‘freedom fighters’ and Iraqi Islamists that have trained in Turkey that is now raising havoc in Syria. So even the Israelis are granting that Assad’s claim of foreign troops being responsible for violence in Syria is at least partially true. Not much chance of Assad backing down under those circumstances.

In addition, former Prime Minister of Lebanon Hariri, a still very powerful billionaire, an avowed enemy of Lebanese Hezbollah and Syria, has petitioned the Arab League to institute a no-fly zone in Syria. They have not said no.

Will the next move of the Arab League, even if ‘only’ sanctions, cross the new red line that Iran has drawn in the sands of the Middle East? Since Saudi Arabia spearheads the Arab League, and Saudi Arabia is very tied in with the United States government, will the Iranians see AL sanctions as equivalent to direct U.S. sanctions? Very probably. And if so, will that not trigger the closing of the Strait of Hormuz?

U.S. benchmark crude oil futures (NYMEX) have climbed back to over $101, coming up from $97 last Wednesday. The reason given by analysts were an improved economy (?) and the Iranian threat of closing the Strait of Hormuz. It will be interesting to see what happens tomorrow in this realm.

Not directly associated with anything else in this post, but indirectly of tremendous importance… the Chinese and Japanese prime ministers have issued a statement saying that Japan and China have agreed to stop using the dollar as currency in trade between the two nations, amounting to a third of a trillion dollars per year. They will use the Chinese yuan. The dollar has essentially lost Asia. This is major news.

I wonder if this news had anything to do with Iran making such an aggressive policy change today? Do they feel that the economic might of the U.S. is crumbling, and that their threats will fall upon the ears of a more docile U.S. administration?

General Martin Dempsey, chairman of the U.S. Joint Chiefs of Staff, pre-answered that question last week. “My biggest worry is that it (Iran) may miscalculate our resolve. Any miscalculation could mean that we are drawn into conflict and that would be a tragedy for the region and the world.” Clearly, if it were up to him, any Iranian move to close the Strait of Hormuz would lead straight to war.

Meanwhile in Israel, while the Israeli Air Force made two airstrikes into the Gaza Strip, killing perhaps 3 and wounding perhaps 11, Israel Defense Forces Chief of Staff Lt. Gen. Benny Gantz called the infamous Cast Lead operation of 2008 “an excellent operation that achieved deterrence for Israel vis-a-vis Hamas.” At least for a time. He said that now a ’second round of fighting in Gaza is not a matter of choice for Israel; it must be initiated by Israel and must be “swift and painful”‘.

When does he say he will initiate Cast Lead II? “We will act when the conditions are right.”

The gargantuan Velayat naval drill continues in its fifth of ten days, with Iran saying all their domestically produced weapons are functioning perfectly. No comment on that by the U.S. or associated nations who have substantial naval resources observing the Iranian drill. No word about the Iranian drones or cyber capabilities. No new reports of near misses or aircraft being warned off. But the area of the drill is still intrinsically highly dangerous.

Bottom line: it seems that it is still a horse race as to how and where the incipient Middle East war will start.

But that it will start, and start soon, would seem to be a safe bet.