POSTED: 16 January 2006 - 3:30pm

Iran playing a key role in world oil supplies

Iranian clergy faces secular oil minister

Oil prices rise on concerns about Iran, Nigeria
published 16 January 2006 by the Associated Press

Crude futures rose Monday after another attack on an oil platform in Nigeria and Iran warned that any sanctions imposed over the country's nuclear program could send oil prices even higher.

Brent crude for February delivery gained 77 cents to $63.03 a barrel on London's ICE Futures exchange, ahead of the contract's expiration Monday. Trading on the New York Mercantile Exchange was closed for the Martin Luther King Day holiday.

Royal Dutch Shell PLC said it had evacuated over 300 staffers and contractors from facilities in the Niger Delta. Heavily armed attackers damaged the Benisede oil platform in the Niger Delta and said some of its staff had been injured. The company also said it had begun evacuating personnel from some facilities in the region.

On Wednesday, gunmen attacked Shell's EA platform near the delta coast, seizing a Bulgarian, an American, a British and a Honduran. A major Shell pipeline leading to its Forcados export terminal was blown up the following day.
The company said recent violence has caused its consortium to cut 106,000 barrels in daily crude production. Nigeria is Africa's leading oil exporter and the fifth-biggest source of U.S. oil imports. The country produces about 2.5 million barrels a day.

Analysts also said prices were supported by concerns that the U.N. Security Council will consider sanctions against Iran because of its nuclear program, which the United States says is geared toward acquiring nuclear weapons. Iran maintains that the program will strictly be used to generate electricity.

''The major concern is that there is no spare capacity to make up for any drop in oil supply from Iran, a fact that the country's leaders know and which enables them to be bolder than usual,'' said Sucden Commodity brokers.
Iranian Economy Minister Davoud Danesh-Jafari warned that any sanctions on Iran from the West could, by disturbing Iran's political and economic situation, raise oil prices ''beyond levels the West expects,'' Danesh-Jafari said, the English-language Tehran Times reported Monday.



Energy-thirsty China is Iran’s umbrella

16 January 2006 - 3:30pm

Oil storage farm in southern Iran

by Martin Parry on 12 August 2005 in Middle Easy Online

Analysts see Chinese opposition to taking Iran to Security Council over nuclear crisis is all about oil.

China's opposition to taking the Iranian nuclear crisis to the UN Security Council is largely driven by their long-term oil relationship, sparked in part by the US occupation of Iraq, analysts say.

Iran's Deputy Foreign Minister Gholamali Khoshroo is currently in Beijing to explain Tehran's position on resuming uranium conversion activities at a plant in Isfahan, which has caused an international outcry.The move prompted the International Atomic Energy Agency (IAEA) to set a September 3 date for a report on Iran's compliance which could lead to a possible referral to the Security Council for sanctions, such as a ban on oil sales.China, a nuclear power and one of the Security Council's five permanent veto-wielding members, has made it clear it does not want the issue before the UN body."

It would not be helpful ... We all want a peaceful solution to the Iranian issue. So I think the best place is the efforts between the EU (European Union) and (the) Iranians or the IAEA," China's UN ambassador Wang Guangya said this week.

"The council has too many things on the table. Why should we add more?"Beijing's stance is partly because it has a policy of not interfering in other countries internal affairs, driven by the fact that it does not want similar outside interference in its own domestic matters.But mostly it is down to economic interests, in particular oil which China needs to keep firing its remarkable economic transformation, experts said.In 1997 China negotiated a 1.3 billion dollar contract with Saddam Hussein to develop the al-Ahdab oil field in central Iraq, and in 2001 it was in talks develop the much larger Halfayah field."Between them, the two fields might have accounted for almost 400,000 barrels per day, or 13 percent of China's oil consumption in 2003," said Michael Schwartz, professor of sociology at the State University of New York who specialises in Iraq and Iran."However, like Iraq's other oil customers (including Russia, Germany and France), China was prevented from activating these deals by the UN sanctions then in place ..."

When the US invaded and set up the Coalition Provisional Authority all pre-existing contracts and promises were null and void, wiping out China's stake in Iraqi oil fields.So it turned to Iran, and sealed a 70 billion dollar contract to import Iranian oil, and has since signed a host of other economic agreements, including building the first stage of the Tehran subway system."In other words, the war in Iraq - and the resistance that it triggered - played a key role in creating a potentially powerful alliance between Iran and China," said Schwartz.Ehsan Ahrari, an independent strategic analyst based in Virginia who regularly writes on Iran, said that for these reasons, China will never agree to the Iran issue being taken to the Security Council."

China has been strengthening its ties in Iran, most importantly, in the energy field. It also has been doing business with Iran in the transfer of missile, and even nuclear technology," he said on his website"China's voracious energy appetite is in dire need of Iran's considerable oil and gas reserves. It also needs a lot of hard cash to pay for the ever-escalating prices of oil in a bullish seller's market."As long as Iran needs China's missile and nuclear technologies, Beijing expects its oil purchase bills to become eminently manageable.

"Consequently, the Iranians are feeling comfortable that they have reasons to count on China's support if the EU-3 (France, Germany and Britain) and the US were to go to the Security Council."China has a voracious appetite for oil to feed an economy ticking along at 9.5 percent annual growth, and has been searching for supplies in all parts of the globe.The world's most populous country expects to import 130 million tonnes of crude in 2005, up from last year's record high of 122 million tonnes, making it the second largest importer in the world after the United States.



Bush actions in June point to US screwup

16 January 2006 - 3:30pm

Iranian oil refinery near the Persian Gulf coast

The Dark Horse

21 June 2005 in Outlook India
"The explosions in the days preceding the polls in the Arab areas of Khuzestan near the border with Iraq and in Teheran itself were seen by the people as instigated by the US intelligence agencies in order to destabilise Iran. The voting in the first round is thus seen as a firm message sent by the voters to the US to mind its business and not to interfere in the internal affairs of Iran..... If the Bush Administration does not draw the right lessons and continues with its provocative broadcasts/telecasts and actions in the days preceding the second round, it may face the mortification of seeing a strongly anti-US ultraconservative, who had played a role in the 1979-80 decision to storm the US Embassy and take American diplomats as hostages, elected as the next President of Iran---not because the people supported his ultraconservative views, but because they felt that was the only way of teaching a lesson to the US.... Even now, Rafsanjani is tipped to win in the second round. If he does not and if Ahmadinejad wins, he would have reason to thank President Bush for his unexpected victory."

Bush criticism of Iran vote backfires
19 June 2005 in Associated Press
"Iran's spy chief used just two words to respond to White House ridicule of last week's presidential election: 'Thank you.' His sarcasm was barely hidden. The backfire on Washington was more evident. The sharp barbs from President Bush were widely seen in Iran as damaging to pro-reform groups because the comments appeared to have boosted turnout among hard-liners in Friday's election — with the result being that an ultraconservative now is in a two-way showdown for the presidency..... even many opponents of the Islamic establishment objected to Bush's tone and timing. The president's words sounded too much like the prewar rhetoric against Saddam, and many on-the-fence voters were shocked into action, said Abdollah Momeni, a political affairs expert at Tehran University.'People faced a dilemma,' Momeni said. 'In people's minds it became a choice between voting or giving Bush an excuse to attack.'"

Regime rallies behind hardliner
20 June 2005 in the London Times
"The unfamiliar hardline outsider who stormed to second place in Iran’s presidential election, forcing a run-off this Friday, was .... Mahmoud Ahmadinejad...... the shock result seems more the product of Iran’s opaque politics than widespread fraud ..... President Bush contributed to his ascent with an eve-of-election statement in which he said that the Iranian constitution was undemocratic. The regime spun the message brilliantly, telling Iranians that Mr Bush was ordering a boycott: the public voted in droves as a reaction, giving a 63 per cent turnout that exceeded the most optimistic expectations. Ghasim, a 42-year-old Ahmadinejad supporter in south Tehran, said: 'I wasn’t thinking of voting until Bush encouraged us not to. It was like an interfering neighbour affecting family decisions. When I heard he wanted a boycott, I went out and voted immediately.'”

US intervention helps hardliner
26 June 2005 in the Washington Post

"The Ahmadinejad landslide is 'an earthquake' for Iran's foreign policy, said Hadi Semati, a Tehran University political scientist who is now a fellow at the Woodrow Wilson International Center for Scholars. 'The impact of this election will be felt more outside Iran than inside. Based on his statements during the campaign, he's going to be a very tough partner for negotiations'.... The new president also reflects the hard-line positions in Tehran on two issues at the center of U.S. foreign policy: Iraq and Israel, Iranian sources and U.S. analysts said. He appears to have a 'much more serious ideological and moral opposition to Israel' than his predecessors, wrote Anthony H. Cordesman, an expert on the Persian Gulf region, in an analysis yesterday for the Center for Strategic and International Studies. There is a 'higher risk' of Iranian action in Iraq -- and, thus, of confrontation with the United States, he said.'"

China Rocks the Boat with Iran Oil Deal
2 December 2004 in the Asia Times
"For a United States increasingly pointing at China as the next biggest challenge to Pax Americana, the Iran-China energy cooperation cannot but be interpreted as an ominous sign of emerging new trends in an area considered vital to US national interests..... Even short of joining forces formally, the main outlines of a China-Russia-Iran axis can be discerned in their mutual threat perception... For now, however, the quantum leap of China into the Middle East and Caspian energy markets has become a fait accompli, no matter how disturbed its biggest trade partner, the US, may be over its geopolitical ramifications"

see also US Covert operations give victory to Mullahs for more detail