We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are

Life, Liberty and the pursuit of Happiness.

That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed,

Monday, April 02, 2007

Iran Hostage Crisis II: The Oil ATM

By J. Christoph Amberger

Call me a cynic, but Iran’s reversal to the tried-and-true kidnapping traditions of the early Islamic Revolution sure occurred at an opportune time.

Just a week ago, the Russians threatened to pull out of continuing to sell nuclear technology to Mad Mahmoud and the Mullahs. Not because of any concerns about the proliferation of nuclear technology, but because of some unpaid bills.

That’s not surprising. Iran (much like Venezuela) may be raking in petrodollars by the truckload, but both countries’ incompetent economic management has resulted in runaway inflation. When oil prices drop like they did in the first quarter of 2007, it hurts twice as bad.

In past years, oil-producing countries have resorted to publicity whenever this happened. All they needed to do was send a government bigwig into a press conference, have him furrow his brow, and dolefully prognosticate $100 a barrel oil prices. Traders would then jump on the opportunity, pushing up oil prices until their attention span had run out. Which is why OPEC dignitaries wore out the one or other red carpet, trudging to the podium with dire predictions of dwindling oil supplies.

But after pulling the same stunt for a few years in a row, it was time for something new. Luckily, the Persian Gulf is full of Western vessels. And what better way to the big global petrodollar ATM than pulling a daredevil stunt like grabbing Her Majesty’s own sailors off a boat and holding them hostage. It worked for Iran back in 1979. And if you looked at oil prices, it’s working right now.

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