Friday, October 26, 2007

Iran Strike: "All Hell Will Break Loose"

The bad news: the price of oil is at a record high. The good news: the increasing volatility in the oil markets give us great incentive not to hit Iran:

"It will be chaos. . . . I can't really see it," said Abdulsamad al-Awadi, an oil trading consultant and former executive at Kuwait Petroleum. "Having been in the marketplace for almost 30 years, I can't see a scenario for it, or precautionary measures" that oil companies could take. "There are no precautionary measures."

"If war breaks out, anticipate that all hell will break loose in the oil markets," said Robin West, chairman of PFC Energy, a District oil consulting firm.

"If it's a clinical strike like the one that Israel carried out on the Syrian installations and no one admitted to doing it, you'd have a fierce reaction from Iran, but it would probably die down," said Leo Drollas, deputy executive director and chief economist of the Center for Global Energy Studies, a London think tank founded by former Saudi oil minister Ahmed Zaki Yamani. "If it were a botched job with lots of targets and civilians dying and Iranians retaliating . . . it could escalate and the price of oil could shoot up to God knows where."

This comes at the same time that we've launched new sanctions against Iran which, depending on your point of view, are either a precursor to war or an alternative to it. What comes next? Your guess is as good as mine.

UPDATE: Oops. According to Kevin Drum, the Heritage Foundation says we CAN bomb Iran...and profit! It sure is hard to know who to believe...industry insiders, or hacks at a conservative think tank? You make the call.

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