Will President Bush Invade Iran?

I wonder if we will still have cheap oil when the gulf coast, Bangladesh and all the world's coastal cities and small islands are under water.

(By 1979, ocean levels had started rising 10 times the rate after the last mini-iceage, and toay the are rising 30 times faster, at about 3 cm per year I think. These figures are from the top of my head from what I remember reading a few days ago).

The US way of life depends most importantly on cheap oil, over and above a recesion and unemployment it affects the day to day life of all americans who dont go the local store without taking out their station wagon. The pain will be such that the republicans will have no chance of reelction for the next 3 terms atleast

#43 Posted by dost_mittar,

Dost, I'm talking about the oil embargo of 1973 by OPEC. It had nothing to do with Yom Kippur. Where's the problem?

#40 Posted by hamidm2,

Don't concern yourself too much with this inflation adjusted nonsense. Indeed, the oil price fell back to $18 and remained in that region for a long time after Kuwait and Nigeria sabotaged OPEC, which explains your inflation-adjusted prices ... but there weren't any Jihadis back then, were there?

But I wish it doesn't happen in winters anyway because you won't have any heating in your basement where you're doomed to live, and I would hate to see you die of cold instead of like a man under the guillotine :)

Hamidm you are right oil has still a long way to go before it reaches even 79 and 73 levels adjusted for inflation but it will reach there and then some because price oil is not linearly proportional to supply shortage. Hormuz has the majority of the world's traded oil pass through it and the iranians have a few misiles and subs that can block it with just a few tanker hits' it will take the US weeks to clear it unless they deploy most of their fleet there. Iranians can also cause probs in Iraq's oil supply and just Iran beeing taken out of the international market will ratchet oil above 150$ that would be close to 79 levels which sent the US into a recesion and Jimmy Carter out of the oval office

zeemax#38:

I am surprised at the factual errors made by you. Oil prices due to Yom Kippur war did not go up from $18 to $58 unless you are referring to prices in 2007 terms. They went up from less than $3 to $12 in nominal terms. The earlier peak price was $40 as a result of the second oil crisis which, in real terms, would be close to the current market prices.

Iran wont be able to do any long term damage to the world or US economy but it could send the developed world into a much deeper and longer recession than otherwise. the us is any way edging towards a mild recesion due to the mortgage crisis. The strategic reserves and saudi arabia cant hold up world oil prices for the simple reason that saudis are already pumping oil at near full capacity and the vast majority of it flows out from dammam which is in the persian gulf. The US strategic reserve will be used only in case of oil shortage it cannot be used to keep up the price since it is too small. Europe will for the short term get by on north sea and scandinavian oil but prices will rocket up and Japan, east asia , india and china will be left holding their balls.

India and china will be doubly hit one due to the high price of oil and the huge import bill and secondly because their growth is export fed through provision of goods and services to the OECD, their stock markets and economies which are rocketing will crash.

Re: # 40

indiana jones example is apt... the iranians fools are itching for a fight and it won't be pretty for them...

As much as I hate another war - the bedouin antics are really irritating...

Re: # 38

oil is cheap

zeemax,

adjusted for inflation, oil was over $100/bbl in 1979 ...... i think $200/bbl is a reasonable price .... buy a hybrid and stop bitching about it - it will also help global warming and all that other nonsense ...

and stop acting like the saber waving bedouin fool in indiana jones - remember how indi hust took out his gun and shot him dead ? ....

An invasion is not on the cards.

An attack on the other hand might also destablize Pakistan

which is already experiencing the Iraq/Afghanistan fallout.

It appears there's an interesting debate going on about the price of oil if Iran is attacked. The scenario is not $150-200/bbl but $300/bbl plus. During the gulf oil embargo of 1973, the price jumped from $18/bbl to $58/bbl in a few days. It is close to $100 now just because of tension, while consumption has grown many fold since 1973, so even three times is conservative. Make your own guess.

Firstly the people who think Saudia will increase production to keep international prices stable are just plain stupid. The world oil consumption is close to 90 million bbl per day. 60% of that passes through the Strait of Hermuz. How much difference would a Saudi increase make? Besides most of Saudi oil passes through the strait, and they will need to switch 100% to their red-sea port on the other side facing Egypt/Sudan. Iran will certainly escalate and red-sea won't be safe either. And then, who knows if Saudia remains stable itself once Iran escalates the war.

Secondly, the US reserve stocks (continuously built up during price dips) will last for the length of any short war, but EU has no reserves. Europe was the hardest hit in the 1973 oil embargo too. This time the disruption will be disastrous.

Thirdly, it will kill all development in most third world emerging countries. The consumption driven booms in countries like India, Pakistan, China, Thailand, Vietnam etc have already resulted in most of these countries running current account deficits which are hardly sustainable at even $100/bbl. However at $ 300 or $400, it will mean recession accompanied with hyper-inflation; or to coin a term; hyper-stagflation, with plummeting currencies. In short, great civil disorder.

This scenario is why Iran is itching for a fight, and I say Godspeed to them. Finish off the Great Satan once and for all.

America and Iran are partners for the Barrels. The friction causes the price to go up and friends are arms in arms.
While the economies are struggling.
Iran enjoys nagging America and American haunts not Iran but the world that it is going to attack, thus pushing the Oil prices.

Nothing is developing in this situation but the prices. This is money game that's it.
Economic ruin of America is necessary as Israel doesn't the elephant with a brain of a size of peanut awakes to its blunders.

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#28 Posted by Dash_Dot on October 30, 2007 3:46:32 am

there's a silver lining..the government will be forced to cut the cross-subsidy..

in any case, it won't go to 150...think strategic reserve and saudi arabia.

Re: # 33 2-3 years was your time frame....I merely agreed with it..

they will gain in the short term long term they lose and they will lsoe out pretty heavyly that is IMHO.

Dash,

(most of these countries are two bit nations who would not be more than asmall itch were it not for the oil and they will be reduced to that if they go to the 150-200 $ oil. )

Sorry, could not follow you. How could Venezuela and the rest lose out in 2-3 YEARS if oil reaches US$ 150.

Regards