Will
Iran Celebrate The 100th Anniversary Of Its Oil Discovery
With $100 Petroleum?
By Shirzad Azad
02 November, 2007
Countercurrents.org
Oil
prices have surpassed a record US$96 a barrel. Given the growing geopolitical
tensions in the Middle East involving an imminent war between the Turks
and the Kurds over the future of oil-rich Kirkuk and the prospect of
an independent Kurdish state, and the current standoff about Iran's
nuclear program, petroleum prices may cross over $100 a barrel in coming
months.
Despite the indispensible
role of the West, and the United States in particular, in creating and
escalating diverse tensions in the Middle East and among the oil suppliers
of the Persian Gulf region, ironically it is the West itself that will
be forced to suffer from the fuel price hike and the following consequences
of a high-priced energy on the world economy.
Oil functions as the lifeblood
of the global economy and any increase in petroleum prices has serious
effects and, in some cases, devastating pains on big economies in both
developed and developing countries. Cheap oil has long been an important
engine of rapid economic growth and development in the West and the
East.
For instance, it was more
than one and half decades ago when American economist Alan Freeman pointed
out that each $1 fall in the price of a barrel of petroleum transfers
roughly $5 billion a year from Third World countries to North America,
and the difference between oil at $20 a barrel and oil at $25 a barrel
means the transfer of $70 billion to $100 billion from the poor and
impoverished South to the rich and prosperous North. Considering the
sharp rise in global oil consumption over the past decade, there is
no doubt these figures are even more astounding today.
Regarding the new surge in
petroleum prices, the West's quandary over Iran's nuclear issue is of
paramount importance. For Iran, the nuclear program is simply a matter
of national security aiming to counterbalance the country's chronic
energy shortage in a not that far future. Any American uncalculated
harsh policy and irrational behavior in bombing the country would obviously
force the Iranians into defensive and retaliatory measures ranging from
the closure of the world's oil throat, the Hormuz Strait, to attacking
oil tankers and possibly targeting major oil fields in the southern
part of the Persian Gulf. Such a worst-case scenario might cost the
health of all oil-importing economies dearly.
The whole point about the
United States invading and occupying Iraq was oil; the hidden and unspoken
fact behind the West's fuss over Iran's nuclear program is also related
to the issue of oil in one way or another.
What the West prefers is
a weak and defenseless Iran vulnerable to being bullied and comfortable
with being conquered, whenever the necessity comes, as happened for
Iraq in 2003. The West fears that an Iran equipped with nuclear technology
may dash its hopes of classifying the country as another "cakewalk"
in Western geostrategic calculations and grand strategies.
Because of its location at
the juncture of energy-rich Central Asia and the Persian Gulf, with
domination over the Strait of Hormuz, which a majority of tankers carrying
Middle East oil passes through, Iran enjoys a very crucial strategic
location in the world. It is also a main obsession in all considerations
of the great powers with interests in the region. This makes sense of
why hardly any day passes without Iran being in the headlines.
Oil was first discovered
in Iran in May 1908, and then in Iraq shortly after World War I. Three
decades after the discovery of oil in Iran, in 1938, oil was discovered
in Saudi Arabia, which is at present the largest petroleum-producing
country in the world. Iran's current crude oil reserves are estimated
at 137 billion barrels, or 11.6 percent of the world's total reserves.
At the same time, Iran has 29,000 billion cubic meters of natural gas,
or 15.3 percent of total global reserves.
While oil prices are rising,
we have a couple of months left before Iran prepares to celebrate the
100th anniversary of its oil discovery. The continuation of current
circumstances in the region only makes it predictable that the Iranians
will celebrate the epoch-making event of its discovery of oil with $100-a-barrel
petroleum prices.
When it comes to the Persian
Gulf region, a quick glance at history reveals that oil prices are disarmed
before key political developments. The longer the stalemate over Iran's
nuclear issue, the higher the petroleum prices -- and this is undoubtedly
not good news for oil-thirsty economies. Hard policies or even military
options to settle the crisis only make matters worse, which is to say
that U.S. President Bush's prophecy about World War III may come true.
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