Crude oil prices could rise as a result of the wave of anti-government protests in Iran. Any disruption in oil supply through the Persian Gulf could push up oil, which was trading around US$62-a-barrel on the Nymex futures market on Thursday.
Talking on CNBC’s Squawk Box program, Uwe Parpart, the chief strategist at Capital Link International, warned of the dangers after protests against Tehran’s economic policies continued.
“I think that it’s very clear that the Middle East is very polarized,” he said. “You have the Trump administration backing Saudi Arabia. Saudi Arabia has accused Iran of all sorts of nefarious undertakings, including [what is going on] in Yemen.
“And this will play out. We’ll have to see how it will play out, but there is no question it is not just an internal, or domestic affair. It is a broader Middle Eastern affair,” Parpart added.
In such a volatile environment, any problems in oil supply would have a serious impact on the price of crude.
“If there is going to be any kind of disruption to oil supply through the Persian Gulf, or even from Iran itself, then there will be a significant uptake in oil prices,” Parpart, who is the editor of Asia Times, said.
“And we’ll see how this affects the world economy. That is also a potentially very negative thing, especially for certain emerging market economies,” he added.
Shutting Iran out of the oil market would not be enough to allow the US to control the oil market. The US would also have to close the international market to Russia. That also would not be possible, because the largest oil producer,Russia has a close alliance with China, the largest importer of oil.
A sharp rise in the cost of energy to western nations will just result in China taking a bigger share of the global market, because its energy costs would be lower.
The old tried and true American method of sanctioning competitors simply won’t work any more.
The US/Saudi/Israeli coalition will continue to bombard Iran with accusations of supporting Yemen, Hezbollah, and Palestine. We likely will see false flag operations, and blame it on Iran to support more sanctions or a war. These US/Saudi/Israeli coalition accusations scare investments away from Iran. Iran need investments to create more jobs to help Iranians who has struggled a lot during the US/UN sanctions.
Iran and Russia should increase the production capacity to meet the markets demand for oil. Do not let the US and Saudis profit from increased oil prices due to this escalation of lies. Extra production capacity can be useful if there is a coup or more political turmoil in Saudi Arabia. There could also be an attack on Saudi oil facilities from Daesh or others that dislike the US/Saudi/Israeli war on Muslim countries.
The US/Saudi/Israeli coalition is cracking down on aid and security cooperation in the Middle East and Asia. Pakistan has been this week victim. Pakistan and other Muslim nations should consider other options for cooperation, just like Turkey did, after the US/Gulen coup attempted to crush the Turkish democracy. It has raised eyebrows in the Muslim world that Pakistan is assisting the US/Saudi/Israeli agenda against Yemen, Iran, Qatar. Lebanon, Syria, and Palestine. It is time for Pakistan and Muslim countries to say goodbye to the US aid, it is too many strings attached that can make the regional political turmoil escalate.