• 7 hours PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 9 hours Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 11 hours Syrian Rebels Relinquish Control Of Major Gas Field
  • 12 hours Schlumberger Warns Of Moderating Investment In North America
  • 13 hours Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 14 hours Energy Regulators Look To Guard Grid From Cyberattacks
  • 16 hours Mexico Says OPEC Has Not Approached It For Deal Extension
  • 17 hours New Video Game Targets Oil Infrastructure
  • 19 hours Shell Restarts Bonny Light Exports
  • 20 hours Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 1 day Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 1 day British Utility Companies Brace For Major Reforms
  • 1 day Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 2 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 2 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 2 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 2 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 2 days Rosneft Signs $400M Deal With Kurdistan
  • 2 days Kinder Morgan Warns About Trans Mountain Delays
  • 2 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 2 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 2 days Russia, Saudis Team Up To Boost Fracking Tech
  • 3 days Conflicting News Spurs Doubt On Aramco IPO
  • 3 days Exxon Starts Production At New Refinery In Texas
  • 3 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 4 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 4 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 4 days China To Take 5% Of Rosneft’s Output In New Deal
  • 4 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 4 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 4 days VW Fails To Secure Critical Commodity For EVs
  • 4 days Enbridge Pipeline Expansion Finally Approved
  • 4 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 4 days OPEC Oil Deal Compliance Falls To 86%
  • 4 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 5 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 5 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 5 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 5 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 5 days Aramco Says No Plans To Shelve IPO
Alt Text

India’s Urban Explosion Boosts Oil Demand

As India sees incredible growth…

Alt Text

Oil Shows Weakness, But Don’t Expect A Plunge

Oil prices remained firm this…

Alt Text

The Energy War That Erdogan Is Winning

The Turkish Republic of Northern…

Brian Westenhaus

Brian Westenhaus

Brian is the editor of the popular energy technology site New Energy and Fuel. The site’s mission is to inform, stimulate, amuse and abuse the…

More Info

How Iran’s Saber Rattling Could Affect Oil Prices and the Environment

How Iran’s Saber Rattling Could Affect Oil Prices and the Environment

It’s easy to see the Iranian Mullahs and their allied minions as a world threat. The country is a significant source of crude oil, has a strategic location over the Strait of Hormuz, seems to be busily building an atomic arsenal with missile delivery systems, supports radical and violent extraterritorial groups and many believe is directly funding world terrorism against both Muslims and others. Those facts and an incomprehensible disdain for logic, reason, responsibility and common self-preservation sense cannot but alarm any but the dullest of observers.

The atom bomb matter has the largest destructive and life risking potential and has driven other nations to respond. So far that has only gone as far as economic sanctions, an idea of limited effect. But the suspicion is the effect is having an impact, and if Iran is bright enough to use the sanctions as a tool to justify an oil price increasing effect – thus you have a threat to close the Strait of Hormuz – for whatever the real reason.

Iranian Vice President Mohammad Reza Rahimi has warned that Iran will not allow a “drop of oil” to pass through the Strait of Hormuz if the West widens sanctions against his country.  Iranian Navy Admiral Habibollah Sayyari said it would be “really easy” for his forces to block the waterway through which a sixth of the world’s oil flows.

At issue is 40% of the world’s tanker-borne oil passes through the Straits. Iran, some of Iraq’s and Bahrain, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates all ship crude oil out the Strait.

Meanwhile, the U.S. maintains a naval presence in the Gulf, primarily to ensure the oil routes remain open. You can bet the battle plans have been thoroughly thought through and practiced out on the U.S. side. The U.S. Fifth Fleet said on Wednesday it would not allow any disruption of traffic in the Strait of Hormuz, a day after Iran threatened to stop ships moving through the strategic oil route.

Iran bombastic talk has some merit, having mine-laying and missile capability to wreak some damage to ships and seaman’s lives, but the real candidate for disaster would be the environment, as a lot of oil would spill into waters at war. Iran could go down in history as causing the single largest environmental disaster even seen. If the oil spilled was substantial and stays mostly in the gulf, the mess could turn a seawater gulf into dead zone. The Persian Gulf doesn’t seem to be as deep or robust or is as large as the Gulf of Mexico.

The Strait of Hormuz is 21 miles (34 km) wide at its narrowest point. That’s a pretty good-sized area when considering battle plan damage; it will take a lot of sunken ships to block a 21-mile hole. But at the same time, 21 miles is a really small battle area when dealing with missiles.

It will hardly matter, if the Iranians choose to take on the U.S. Fifth Fleet.  The fight won’t last long, after the first shot by the Iranians the U.S. Navy will be deciding the course of battle, if the U.S. President can see to supporting them properly. It could, if the world community gets its act together be the tipping point to set the Iranian people free of the religious zealots and make the whole world a safer place.

People tend to forget the destructive power of an organized, trained and well equipped military force. The past two decades has seen U.S. power become more accurate and effective at disabling counter forces. The U.S has gotten very good at making sure the other guys die for their country – futilely.

And it will be futile. Because also on Wednesday Saudi Arabia said it will offset any loss of oil from a threatened Iranian blockade of the crucial tanker route through the Strait. Add to that the news that Iraq is up to shipping 3 million barrels a day and Libya is back to shipping 1 million more barrels each day. Not only can starting a fight be extremely dangerous to the Iranian regime’s existence, the benefits are already taken off the table.

The Saudi oil ministry official didn’t specify other routes that could be used to transport oil.  There aren’t a lot of options.

The question is how long will it take for the U.S. fleet to clear the sea of combatants.

The idea to start a fight also would have other serious consequences.  The Iranians could lose political support from China and Russia.  Then there is the money; oil provides half of Iran’s revenue and last year that amounted to about $73 billion.

Is it all a tempest of words? Maybe. Just keep in mind the total behaviors of those who do the speaking. That’s enough to cause concern.

By. Brian Westenhaus

Source: Iran Could Be an Oil Price and Environmental Threat

Back to homepage

Leave a comment
  • Fred Banks on January 02 2012 said:
    During the two years that I was an infantry soldier in Japan, I heard lectures about Russia (i.e. the Soviet Union) similar to the kind of thing being discussed in this article, and I heard them almost every week. In reality of course, Russia was not going to attack the US, and the US was not going to attack Russia. A war between these two countries would have been completely illogical.The same is true in the Gulf at the present time, and everybody understands this. OPEC probably picked up a trillion dollars during 2011, and they may well have their sights set on somewhat more for this year. One way to make that happen is to give the impression that an attempt will be made to close the Strait of Hormuz.
  • Philip on January 02 2012 said:
    What a curiously unintelligent view of Iran... The psycholgy of sinking ships on insurance rates would be dramatic. Although I think they would much rather station some of those very effective supersonic anti-ship missiles on the Straits. More controlable than sinking ships. It would take but a few minutes for a team to go in set them and use them. Too fast for the US Navy and AF to respond. They probably have a few (hundred?) hidden away on the shores of the Straits for just such an eventuality. Ship killers and sophisticated MANPADS that even the Israelis are afraid of. They could even have the technology bthere that took over the drone...There are so many possible scenarios for Iran to win by not fighting in the Straits mostly psychological... As for Saudi their capacity/willingness to compensate for oil supply loss is in some doubt...I think this has already been discussed on this website.

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News