Iran Cuts Oil Supply to UK and France

Reuters
February 19, 2012

 Iran has stopped selling crude to British and French companies, the oil ministry said on Sunday, in a retaliatory measure against fresh EU sanctions on the Islamic state’s lifeblood, oil.

“Exporting crude to British and French companies has been stopped … we will sell our oil to new customers,” spokesman Alireza Nikzad was quoted as saying by the ministry of petroleum website.

The European Union in January decided to stop importing crude from Iran from July 1 over its disputed nuclear program, which the West says is aimed at building bombs. Iran denies this.

Iran’s oil minister said on February 4 that the Islamic state would cut its oil exports to “some” European countries.

The European Commission said last week that the bloc would not be short of oil if Iran stopped crude exports, as they have enough in stock to meet their needs for around 120 days.

Industry sources told Reuters on February 16 that Iran’s top oil buyers in Europe were making substantial cuts in supply months in advance of European Union sanctions, reducing flows to the continent in March by more than a third – or over 300,000 barrels daily.

France’s Total has already stopped buying Iran’s crude, which is subject to fresh EU embargoes. Market sources said Royal Dutch Shell has scaled back sharply.

Among European nations, debt-ridden Greece is most exposed to Iranian oil disruption.

Motor Oil Hellas of Greece was thought to have cut out Iranian crude altogether and compatriot Hellenic Petroleum along with Spain’s Cepsa and Repsol were curbing imports from Iran.

Iran was supplying more than 700,000 barrels per day (bpd) to the EU plus Turkey in 2011, industry sources said.

By the start of this year imports had sunk to about 650,000 bpd as some customers cut back in anticipation of an EU ban.

Saudi Arabia says it is prepared to supply extra oil either by topping up existing term contracts or by making rare spot market sales. Iran has criticized Riyadh for the offer.

Iran said the cut will have no impact on its crude sales, warning that any sanctions on its oil will raise international crude prices.

Brent crude oil prices were up $1 a barrel to $118.35 shortly after Iran’s state media announced last week that Tehran had cut oil exports to six European states. The report was denied shortly afterwards by Iranian officials.

“We have our own customers … The replacements for these companies have been considered by Iran,” Nikzad said.

EU’s new sanctions includes a range of extra restrictions on Iran that went well beyond U.N. sanctions agreed last month and included a ban on dealing with Iranian banks and insurance companies and steps to prevent investment in Tehran’s lucrative oil and gas sector, including refining.

The mounting sanctions are aimed at putting financial pressure on the world’s fifth largest crude oil exporter, which has little refining capacity and has to import about 40 percent of its gasoline needs for its domestic consumption.

Tehran Connects First Blow on Washington

by Luis R. Miranda
The Real Agenda
January 15, 2012

In what could be called the duel of words, Tehran has handed Washington and Tel Aviv the first blow in the stomach as both countries decided to postpone the military exercise scheduled to take place a couple of weeks from today.

Citing their intention not to further escalate the war of words between Tehran and the west, Israeli defense officials have publicly announced that their war games will not occur as planned. According to HAARETZ, the Israelis want to “avoid causing further tensions in the region after various foreign reports of U.S. and Israeli preparations for strike on Iran.”

The military exercise was considered the largest of a series of joint manuevers aimed to curb Iran’s military escalation in the Persian Gulf, more specifically in the Strait of Hormuz. Iran has increased its presence in the region as a response to American and Israeli build ups that intend to avoid a potential blockage of the Strait of Hormuz, the main transit way of millions of liters of oil which western nations in Europe and North American depend on to operate. The closing of this important commerce way, say consultants, would heavily damage the state of the global economy.

Iran has expressed their intention to close the Strait of Hormuz if Tehran determines that Israel and/or the United States are close to attack its nuclear energy sites. Both the United States and Israel have denied they have intentions to carry out an attack over Iranian soil. However, recent history shows that the establishment military industrial complex that controls both the American and Israeli governments are not to be trusted when it comes to their military aggression plans.

The military exercise codenamed Austere Challenge 12, intended to simulate an Iranian attack which would include the launch of  missiles on Israel. According to Israeli military officials, the drill is now scheduled to take place in the summer of 2012.

The Israeli Defense Forces said the military exercise was not a response to the recent threats made by Iranian authorities but that it had been planned a long time ago. The drill “is not in response to any real-world event,” said the IDF in a statement.

Additionally, the Defense Ministry said that the postponement of the drill has not been announced, because the final decision is still being addressed by Israeli and U.S. officials. The entity also asserted that the reason the drill was postponed did not have anything to do with budgetary issues.

Major military exercises between Israel and the United States began to take place in 2009, with both nations holding large joint missile defense exercise. It was those same exercises along with the invasion of Egypt, Libya and Syria by U.S. special forces and CIA agents, what prompted Iran to begin a military escalation in the region which sounded all the war alarms in the Persian Gulf.