[lbo-talk] Saudis Waging an Oil War on Iran?

Yoshie Furuhashi critical.montages at gmail.com
Thu Jan 25 07:07:12 PST 2007


On 1/25/07, Marvin Gandall <marvgandall at videotron.ca> wrote:
> Yoshie wrote:
>
> > There are lots of factors, from unseasonably warm weather (due in part
> > to climate change) to rates of economic growth, many of which are
> > beyond the control of oil producers. The issue is what the Saudi
> > ruling class are doing with the part they do control, their own oil
> > reserves.
> =============================
> But it is not as if Iran has suddenly become an American target. If it were
> as easy - as is being suggested - to force regime change or to otherwise
> alter Iranian behaviour by driving the oil price lower, using the the Saudis
> as swing producer, you'd think think the Americans would have engineered
> this long ago.

Regime change is not easy, but it is not without a precedent either, e.g., Yugoslavia ("Sanctions on Yugoslavia," <http://www.cnn.com/SPECIALS/2000/yugo.crisis/story/sanctions/>).

Regime changes through elite and popular discontent induced by economic sanctions, military attacks, etc., whether successful (Yugoslavia) or unsuccessful (Iraq), take a long time, probably more than a decade. In Yugoslavia, US and EU sanctions were imposed in 1991, and regime change did not happen until 2000. Thinking in terms of a decade-long project, Riyadh's big oil production capacity expansion makes perfect sense.

Now, a factor exists in Iran that didn't exist earlier in the history of the Islamic Republic: large and growing domestic oil and gas consumption, which affects Iran's ability to export oil and gas and earn foreign exchange and win friends abroad. (It is said that gasoline will be rationed in Iran, from March this year, but that won't rein in domestic consumption quickly.) I'm sure Washington, Riyadh, etc. are thinking hard about how to exploit this problem.


> The main weapon being used against Iran is not the oil price, but the
> long-standing financial squeeze against its industry organized by the US
> Treasury. In the past year, it has stepped up its attempt to cut the flow of
> foreign credit which Iran needs to its maintain, upgrade and expand its oil
> industry, especially by the European banks who are the most vulnerable to US
> sanctions.

Obviously, financial sanctions affect Iran's ability to attract foreign investment into its oil and gas industries the most.


> while the Chinese have compensated for any shortfall by rapidly
> becoming a major Iranian energy market and source of investment capital.

China may or may not be able to make up for US, EU, and Japanese sanctions.


> That leaves the only remaining alternative on the great chain of
> escalation - the threatened Lebanon-style massive destruction of Iranian
> facilities by air and missile assault - the dangerous game of chicken in
> which the US and Israel are presently engaged.

They might launch missile strikes this year, but missile strikes don't change regimes, so if they do, that won't be the end of it -- instead, it will be part of a long-term campaign for regime change. -- Yoshie <http://montages.blogspot.com/> <http://mrzine.org> <http://monthlyreview.org/>



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