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Under pretense of
looking for other sources of oil, EU Iran Oil Embargo Over
Nuclear Work Said Likely to Be Delayed Six Months
A
European Union embargo on imports of Iranian (OPCRIRAN) oil will probably be
delayed for six months to let countries such as Greece, Italy and Spain find
alternative supplies, two EU officials with knowledge of the talks said.
The embargo, which would need to be accepted by the 27- nation bloc’s
foreign ministers on Jan. 23, is also likely to include an exemption for
Italy, so crude can be sold to pay off debts to Rome-based Eni SpA (ENI), Italy’s
largest oil company, according to the officials, who declined to be
identified because the talks are private.
A ban on petrochemical products would start sooner, about three months after
EU ministers agree to the measure, one official said yesterday. Once a
decision is made, member states would be barred from concluding new oil
contracts with Iran or renewing those that are due to expire, while existing
deals will be terminated within six months, according to a second diplomat
today. Long-term contracts constitute the bulk of Europe’s purchases of
Iranian oil.
Phasing in the European embargo would satisfy the concern of nations most
dependent on Iranian crude, including Italy, Greece and Spain, the first EU
official said. Those three nations accounted for 68.5 percent of EU imports
from Iran in 2010, according to European Commission data.
As Europe weighs its embargo, President Barack Obama’s administration
has sent teams worldwide to consult with countries on managing the supply and
demand of oil, according to an administration official who briefed reporters
in Washington.
OPEC’s other members would be able to make up for a drop in Iranian oil
supply if the EU agrees to an embargo, said Chakib Khelil, the group’s former president. Even so,
prices may temporarily rally to as high as $200 a barrel on news of any such
blockade, he said today in London.
“It should be possible to replace, at least, the European consumption
of Iranian oil,” Khelil said in an interview
with Mark Barton on Bloomberg Television’s “On the Move.”
Obama's Arrogance Coupled With Economic Idiocy
Anone who thinks president Obama can manage the
supply and demand of oil is a fool. Sending teams worldwide in an attempt to
do that is not only the height of arrogance, it is economic idiocy
Phased In Oil Shock
Iran is OPEC's second largest oil producer. Bloomberg estimates that Iran
pumped 3.58 million barrels of crude a day last month.
The idea that Iran's oil supply can easily be replaced is pure nonsense.
Phasing in an embargo is the same as phasing in higher prices smack in the
midst of an already guaranteed monster European recession.
Given that US Defense Secretary Admits
"Iran Not Trying to Develop Nuclear Weapon" this move by the US
and Europe is not only economic suicide, it is an illegal act of war as well.
Can China Benefit From Obama's Move?
Superficially, the only possible beneficiary to Obama's and the EU's economic
warfare is China.
For details, please see China Snubs Geithner on Iran
Oil; China Gets Cheaper Iran Oil as U.S. Pays Tab for Hormuz Patrols; Retired
Admiral Warns "US Policy Benefits the Chinese"
However, it's important to understand that Chinese "benefit" is an
illusion, in isolation.
In aggregate, oil-dependent countries including China cannot conceivably
benefit from an oil shock or higher oil prices because global trade will
collapse. OPEC exporters may temporarily benefit from higher prices but the
expense will be falling usage and a strengthening worldwide recession.
If one wonders why Iran may want nuclear weapons, the US and EU have certainly given Iran sufficient reasons.
How to Stop the Madness
This proposed embargo is economic idiocy as well as an act of war by the US
and EU on Iran.
Once again I point out that President Obama has continued the inane policies
of President Bush. Newt Gingrich and Mitt Romney would do the same.
If one wishes to end the economic and war-mongering madness, there is only
one electable choice: Ron Paul.
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