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Tuesday, October 14, 2014

Thomas Friedman, "A Pump War?": Not Really

In a New York Times op-ed entitled "A Pump War?," Thomas Friedman writes:

"Is it just my imagination or is there a global oil war underway pitting the United States and Saudi Arabia on one side against Russia and Iran on the other?

. . . .

Think about this: four oil producers — Libya, Iraq, Nigeria and Syria — are in turmoil today, and Iran is hobbled by sanctions. Ten years ago, such news would have sent oil prices soaring. But today, the opposite is happening. Global crude oil prices have been falling for weeks, now resting around $88 — after a long stretch at $105 to $110 a barrel."

So, oil prices are down by some 18 percent. Great, but Iranian oil exports are also growing significantly this year.

As reported in a June 12, 2014 Bloomberg article entitled "Growing Iran Oil Exports Challenge U.S. Nuclear Sanctions" by Indira A.R. Lakshmanan and Anthony DiPaola:

"Iran’s oil exports have risen this year, according to Bloomberg calculations, a trend that threatens to violate U.S. sanctions on the Islamic Republic’s main source of revenue.

Shipments of Iranian crude oil and condensate have increased about 28 percent on average this year, according to an analysis of customs data from importing nations and figures from the International Energy Agency in Paris. If crude sales are up by the end of July, that would break an international accord to hold Iran’s oil exports at the same level in the first half of this year that they were at in the previous six months."

See also what Clifford Krauss writes in an August 12, 2014 New York Times article entitled "With Natural Gas Byproduct, Iran Sidesteps Sanctions":

"Iran is finding a way around Western sanctions to export increasing amounts of an ultralight oil to China and other Asian markets, expanding the value of its trade by potentially billions of dollars a year.

The exports come during a slight thaw in Iran’s relations with the West as negotiations over its nuclear program continue, and energy experts say it is counting on the United States and Europe to tolerate an increasing export stream.

According to Iranian customs data, the country in recent months has exported 525,000 barrels a day of the ultralight oil, known as condensates, over two times more than it did a year ago. In the last three months, the sales have generated as much as $1.5 billion in extra trade — a rate of about $6 billion a year — based on Iranian trade figures and market prices, analysts said."

Iran is being "hobbled by sanctions" on its oil exports? No, not after Obama, in search of a deal to slow Iran's nuclear weapons development program, sought to appease Khamenei by easing trade sanctions pursuant to the November 2013 Geneva interim agreement.

Meanwhile, as reported today in a Times of Israel article entitled "Israel fumes at ‘post-sanctions’ Iran conference in London" by Raphael Ahren:

"An international conference to promote business ties between Europe and Iran is set to begin Wednesday in London, arousing the ire of local pro-Israel groups and senior government officials in Jerusalem.

The '1st Europe-Iran forum' seeks to prepare the ground for 'post-sanctions investment and trade,' according to its official website. Speakers at the conference, which has been endorsed by the office of Iranian President Hassan Rouhani, include former foreign ministers from the United Kingdom and France, one British MP, and a senior official currently serving in the British Foreign Office."

A "global oil war" is underway against Iran? Apparently, the UK and France also don't know anything about it.

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