Iran Threatens Oil Prices if Sanctioned on Nukes

Iran’s economy minister, Davoud Danesh-Jafari threatened to raise world oil prices if the West follows through on threats to sanction his country for non-compliance with IAEA nuclear inspection regimes.

Iran stepped up its defiance of international pressure over its nuclear programme yesterday by warning of soaring oil prices if it is subjected to economic sanctions. As diplomats from the US, Europe, Russia, and China prepared to meet today in London to discuss referring Tehran to the UN security council, Iran’s economy minister, Davoud Danesh-Jafari, said the country’s position as the world’s fourth-largest oil producer meant such action would have grave consequences. “Any possible sanctions from the west could possibly, by disturbing Iran’s political and economic situation, raise oil prices beyond levels the west expects,” he told Iranian state radio. In a provocative move, Iran also announced plans yesterday to convene a “scientific” conference to examine the evidence supporting the Holocaust. The news comes weeks after President Mahmoud Ahmadinejad provoked a global outcry by describing the slaughter of 6 million Jews by the Nazis in the second world war as a “myth”. Mr Danesh-Jafari’s comments echoed fears voiced by energy market analysts after crude oil prices last week rose above $64 (£36.50) a barrel as hopes faded of a diplomatic solution to the dispute. Last week, Manouchehr Takin, of the Centre for Global Energy Studies, argued that crude prices could hit $100 a barrel if Iran stopped exporting. “Supply and demand are very tightly balanced,” he said. Mr Danesh-Jafari’s warning added weight to veiled threats by Iran’s president on Saturday. Iran had a “cheap means” of achieving its nuclear “rights”, Mr Ahmadinejad said, adding: “You [the west] need us more than we need you. All of you today need the Iranian nation.” Recognising the danger, Gernot Erler, Germany’s deputy foreign minister, said yesterday: “We are seeing desperate measures by Asian countries, mainly China, India and others, to get hold of energy resources, and for them Iran is a partner they can’t do without.” He said it was “dangerous” to put restrictions on trade relations “which could hurt one’s own side more than the other side”.

No kidding.

Of course, such a move would also increase the attractiveness of the military option in Iran. Still, as I’ve written numerous times, our choices are limited and none of the options particularly appealing. And, as this move illustrates, our dependance on Middle Eastern oil is always a major complicating factor.

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James Joyner
About James Joyner
James Joyner is a Security Studies professor at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Herb says:

    The time has come for the US and the entire world to put Iran with all of its mullahs in their place. I for one don’t give a damn if Iran does cut off the flow of oil. If they did Iran itself would hurt with the cutting off of the oil money they take in. The cut of money to Iran along with strict sanctions would surely hurt them.

    If the sanctions don’t work, then a military strike is in order and I would not rule out the use of nukes to destroy their nuke capabilities.

    We in the US have put up with their threats and anti American crap and their sponsering of terrorism for over 25 years now and I don’t know of one true American that would not support the nuking of Iran’s nuke facilities.

    I know there will be some pacifists here who will disagree, so let them rant on and praise the mullahs then move their sorry rear ends to Iran where they belong.

  2. LJD says:

    U.N. sanctions, pre-emptive strikes… all outdated approaches and exactly what Iran expects. No, we need to stop fighting with this pre-9/11 mentality.

    We need to kidnap around 66 Mullahs, hold them hostage for 444 days, or until they voluntarily give up nuclear wepaons and LOWER the price of oil.

    …or we could just send Jimmy Carter.
    …Jesse Jackson?

  3. Joe white says:

    Yes herb we own everybody even the Iranians, dont we? especially after the so called civilised world allowed king george and “kabal” to destroy Iraq’s infrastructure, guess we built it! as well as gave life to the hundreds of thousands of innocents we murdered in the process, keep up the good work.
    hope you dont have to get old before you grow up

  4. Herb says:

    Hey Joe White:

    Wow, You really have a problem. Perhaps you are living to far in the past. Maybe you should have been. By the way, the subject is Iran, Not Iraq. You just have to be one of those sore losing liberals who just can’t get over it. Somehow you remind me of Al Gore and John Kerry. Always shooting off your big mouth about the wrong subject. Get with it Joe White. Everyone would appreciate it.