AUGUST 4, 2011
By Barry Rubin
Summary: It’s not every day when I high-ranking official of a revolutionary Islamist group that seeks world revolution, wiping Israel off the map, the widespread use of terrorism, and the destruction of the United States becomes head of the world’s most powerful energy organization on whose suppies America is dependent.
This is the man who will now head the Organization of Petroleum-Exporting Countries (OPEC), which sets the prices and production levels for oil Why? Because in October it became Iran’s turn to choose that person. Iran is second only to Saudi Arabia as an oil exporter. Iran’s interests are to get prices as high as possible and thus hold down production levels when possible.
This is the opposite of Saudi interests since that country has far fewer people and thus wants a longer-term strategy. In addition, unlike Iran, the Saudis have extensive investments in the West and so have an incentive to keep Western economies healthy. With an increasingly powerful Iran racing toward nuclear weapons and an increasingly weak United States racing toward abdicating international power, the Saudis have to pay more attention to Iran’s demands.
As the Obama Administration acts against oil drilling and makes production harder, the supply situation is becoming more dangerous. It isn’t that Ghasemi will do whatever he wants, of course, but having a doctrinaire Iranian Islamist radical heading OPEC as a sanctions-deying matter is somewhat scary, right?
Now, President Obama, about that little matter of drilling in the “Gulf.” You have a choice: “Persian” or “of Mexico?”
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Note: An economist I know suggests that the effect will make the Saudis ignore OPEC and do what they want on production levels.
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Note: An economist I know suggests that the effect will make the Saudis ignore OPEC and do what they want on production levels.
UPDATE ..
