Monday, April 09, 2007

 

Russia Would Want an American-Iranian War

Short answer: $200 a barrel oil

Edit: The unofficial Politburo of the new Russia is filled with ex communist oilmen. These people realize Russia's main source of strength is oil. High oil prices only serves to increase Russia's power.

The Russia leadership would like to gain control of the Russian border states (also called the near abroad). These are Russia's traditional sphere of influence and Russia keenly feels the loss of influence in this region.

A war between America and Iran would almost certainly lead to Iranian missile and terrorist attacks on the oil facilities in the Arabian peninsula. As well Iran would probably also be able to stop shipping through the Straits of Hormuz. These attack could easily result in oil prices of $200 to $300 a barrel (Much higher if America begins to suffer hyperinflation*).

Oil wealth would give Russia economic leverage to begin to get control of its near abroad and counter Russia's perceived humiliation at the hands of the West.

Russia also knows the America and Israel do not want to see Iran develop nuclear weapons. America's influence in the region would be greatly curbed. Israel, however, would face an existential threat. A small number of nuclear weapons delivered by rocket from Iran's Hezbollah allies could physically destroy Israel (a plain of radioactive glass) with Israel beening able to mount a successful counter attack (due to the short flight time of the incoming missiles. Israel might only have minutes to react). As such Israel could be forced into a war with Iran to insure its own existence.

Not pretty, I know.

* China is very dependent on imported oil. China also has about a trillion US dollars in the bank. I would expect China to use this money to get oil in the event of such an oil crisis. These would lead to a flood of US dollars on the market oversaturating supply and creating a scenario ripe for hyperinflation.

And Japan has about the same amount of money and is more dependent on oil imports then China is.

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