Page 2 of
2 THE ROVING
EYE The
myth of an "isolated' Iran By
Pepe Escobar
Washington continues to push a
vision of a world from which Iran has been
radically disconnected. State Department
spokesperson Victoria Nuland is typical in saying
recently, "Iran can remain in international
isolation." As it happens, though, she needs to
get her facts straight.
"Isolated" Iran
has $4 billion in joint projects with Venezuela
including, crucially, a bank (as with Ecuador, it
has dozens of planned projects from building power
plants to, once again, banking). That has led the
Israel-first crowd in Washington to vociferously
demand that sanctions be slapped on Venezuela.
Only problem: how would the US pay for its crucial
Venezuelan oil imports then?
Much was made
in the US press of the fact that Ahmadinejad did
not visit Brazil on this
jaunt through Latin America, but diplomatically
Tehran and Brasilia remain in sync. When it comes
to the nuclear dossier in particular, Brazil's
history leaves its leaders sympathetic.
After all, that country developed - and
then dropped - a nuclear weapons program. In May
2010, Brazil and Turkey brokered a uranium-swap
agreement for Iran that might have cleared the
decks on the US-Iranian nuclear imbroglio. It was,
however, immediately sabotaged by Washington. A
key member of the BRICS, the club of top emerging
economies, [1] Brasilia is completely opposed to
the US sanctions/embargo strategy.
So Iran
may be "isolated" from the United States and
Western Europe, but from the BRICS to NAM (the 120
member countries of the Non-Aligned Movement), it
has the majority of the global South on its side.
And then there are those staunch Washington
allies, Japan and South Korea, now pleading for
exemptions from the coming boycott/embargo of
Iran's central bank.
No wonder, because
these unilateral US sanctions are also aimed at
Asia. After all, China, India, Japan, and South
Korea together buy no less than 62% of Iran's oil
exports.
With trademark Asian politesse,
Japan's Finance Minister Jun Azumi let Treasury
Secretary Timothy Geithner know just what a
problem Washington is creating for Tokyo, which
relies on Iran for 10% of its oil needs. It is
pledging to at least modestly "reduce" that share
"as soon as possible" in order to get a Washington
exemption from those sanctions, but don't hold
your breath. South Korea has already announced
that it will buy 10% of its oil needs from Iran in
2012.
Silk Road redux Most
important of all, "isolated" Iran happens to be a
supreme matter of national security for China,
which has already rejected the latest Washington
sanctions without a blink. Westerners seem to
forget that the Middle Kingdom and Persia have
been doing business for almost two millennia.
(Does "Silk Road" ring a bell?)
The
Chinese have already clinched a juicy deal for the
development of Iran's largest oil field,
Yadavaran. There's also the matter of the delivery
of Caspian Sea oil from Iran through a pipeline
stretching from Kazakhstan to Western China. In
fact, Iran already supplies no less than 15% of
China's oil and natural gas. It is now more
crucial to China, energy-wise, than the House of
Saud is to the US, which imports 11% of its oil
from Saudi Arabia.
In fact, China may be
the true winner from Washington's new sanctions,
because it is likely to get its oil and gas at a
lower price as the Iranians grow ever more
dependent on the China market. At this moment, in
fact, the two countries are in the middle of a
complex negotiation on the pricing of Iranian oil,
and the Chinese have actually been ratcheting up
the pressure by slightly cutting back on energy
purchases.
But all this should be
concluded by March, at least two months before the
latest round of US sanctions go into effect,
according to experts in Beijing. In the end, the
Chinese will certainly buy much more Iranian gas
than oil, but Iran will still remain its third
biggest oil supplier, right after Saudi Arabia and
Angola.
As for other effects of the new
sanctions on China, don't count on them. Chinese
businesses in Iran are building cars, fiber optics
networks, and expanding the Tehran subway. Two-way
trade is at $30 billion now and expected to hit
$50 billion in 2015. Chinese businesses will find
a way around the banking problems the new
sanctions impose.
Russia is another key
supporter of "isolated" Iran. It has opposed
stronger sanctions either via the United Nations
or through the Washington-approved package that
targets Iran's central bank. In fact, it favors a
rollback of the existing UN sanctions and has also
been at work on an alternative plan that could, at
least theoretically, lead to a face-saving nuclear
deal for everyone.
On the nuclear front,
Tehran has expressed a willingness to compromise
with Washington along the lines of the plan Brazil
and Turkey suggested and Washington deep-sixed in
2010. Since it is now so much clearer that, for
Washington - certainly for congress - the nuclear
issue is secondary to regime change, any new
negotiations are bound to prove excruciatingly
painful.
This is especially true now that
the leaders of the European Union have managed to
remove themselves from a future negotiating table
by shooting themselves in their Ferragamo-clad
feet. In typical fashion, they have meekly
followed Washington's lead in implementing an
Iranian oil embargo. As a senior EU official told
National Iranian American Council President Trita
Parsi, and as EU diplomats have assured me in no
uncertain terms, they fear this might prove to be
the last step short of outright war.
Meanwhile, a team of International Atomic
Energy Agency inspectors has just visited Iran.
The IAEA is supervising all things nuclear in
Iran, including its new uranium-enrichment plant
at Fordow, near the holy city of Qom, with full
production starting in June. The IAEA is positive:
no bomb-making is involved. Nonetheless,
Washington (and the Israelis) continue to act as
though it's only a matter of time - and not much
of it at that.
Follow the money That Iranian isolation theme only gets weaker
when one learns that the country is dumping the
dollar in its trade with Russia for rials and
rubles - a similar move to ones already made in
its trade with China and Japan. As for India, an
economic powerhouse in the neighborhood, its
leaders also refuse to stop buying Iranian oil, a
trade that, in the long run, is similarly unlikely
to be conducted in dollars.
India is
already using the yuan with China, as Russia and
China have been trading in rubles and yuan for
more than a year, as Japan and China are promoting
direct trading in yen and yuan. As for Iran and
China, all new trade and joint investments will be
settled in yuan and rial.
Translation, if
any was needed: in the near future, with the
Europeans out of the mix, virtually none of Iran's
oil will be traded in dollars.
Moreover,
three BRICS members (Russia, India and China)
allied with Iran are major holders (and producers)
of gold. Their complex trade ties won't be
affected by the whims of a US Congress. In fact,
when the developing world looks at the profound
crisis in the Atlanticist West, what they see is
massive US debt, the Fed printing money as if
there's no tomorrow, lots of "quantitative
easing", and of course the Eurozone shaking to its
very foundations.
Follow the money. Leave
aside, for the moment, the new sanctions on Iran's
central bank that will go into effect months from
now, ignore Iranian threats to close the Strait of
Hormuz (especially unlikely given that it's the
main way Iran gets its own oil to market), and
perhaps one key reason the crisis in the Persian
Gulf is mounting involves this move to torpedo the
petrodollar as the all-purpose currency of
exchange.
It's been spearheaded by Iran
and it's bound to translate into an anxious
Washington, facing down not only a regional power,
but its major strategic competitors China and
Russia. No wonder all those carriers are heading
for the Persian Gulf right now, though it's the
strangest of showdowns a case of military power
being deployed against economic power.
In
this context, it's worth remembering that in
September 2000 Saddam Hussein abandoned the
petrodollar as the currency of payment for Iraq's
oil, and moved to the euro. In March 2003, Iraq
was invaded and the inevitable regime change
occurred. Libya's Muammar Gaddafi proposed a gold
dinar both as Africa's common currency and as the
currency of payment for his country's energy
resources. Another intervention and another regime
change followed.
Washington/NATO/Tel Aviv,
however, offers a different narrative. Iran's
"threats" are at the heart of the present crisis,
even if these are, in fact, that country's
reaction to non-stop US/Israeli covert war and
now, of course, economic war as well. It's those
"threats," so the story goes, that are leading to
rising oil prices and so fueling the current
recession, rather than Wall Street's casino
capitalism or massive US and European debts. The
cream of the 1% has nothing against high oil
prices, not as long as Iran's around to be the
fall guy for popular anger.
As energy
expert Michael Klare pointed out recently, we are
now in a new geo-energy era certain to be
extremely turbulent in the Persian Gulf and
elsewhere. But consider 2012 the start-up year as
well for a possibly massive defection from the
dollar as the global currency of choice. As
perception is indeed reality, imagine the real
world - mostly the global South - doing the
necessary math and, little by little, beginning to
do business in their own currencies and investing
ever less of any surplus in US Treasury bonds.
The US can always count on the Gulf
Cooperation Council (GCC) - Saudi Arabia, Qatar,
Oman, Bahrain, Kuwait and the United Arab Emirates
- which I prefer to call the Gulf
Counter-revolution Club (just look at their
performances during the Arab Spring). For all
practical geopolitical purposes, the Gulf
monarchies are a US satrapy.
Their
decades-old promise to use only the petrodollar
translates into them being an appendage of
Pentagon power projection across the Middle East.
Centcom, after all, is based in Qatar; the US
Fifth Fleet is stationed in Bahrain. In fact, in
the immensely energy-wealthy lands that we could
label Greater Pipelineistan - and that the
Pentagon used to call "the arc of instability" -
extending through Iran all the way to Central
Asia, the GCC remains key to a dwindling sense of
US hegemony.
If this were an economic
rewrite of Edgar Allen Poe's story, "The Pit and
the Pendulum", Iran would be but one cog in an
infernal machine slowly shredding the dollar as
the world's reserve currency. Still, it's the cog
that Washington is now focused on. They have
regime change on the brain. All that's needed is a
spark to start the fire (in - one hastens to add -
all sorts of directions that are bound to catch
Washington off guard).
Remember Operation
Northwoods, that 1962 plan drafted by the Joint
Chiefs of Staff to stage terror operations in the
US and blame them on Fidel Castro's Cuba.
(President John F Kennedy shot the idea down.) Or
recall the Gulf of Tonkin incident in 1964, used
by president Lyndon Johnson as a justification for
widening the Vietnam War. The US accused North
Vietnamese torpedo boats of unprovoked attacks on
US ships. Later, it became clear that one of the
attacks had never even happened and the president
had lied about it.
It's not at all
far-fetched to imagine hardcore full-spectrum
dominance practitioners inside the Pentagon riding
a false-flag incident in the Persian Gulf to an
attack on Iran (or simply using it to pressure
Tehran into a fatal miscalculation). Consider as
well the new US military strategy just unveiled by
President Barack Obama in which the focus of
Washington's attention is to move from two failed
ground wars in the Greater Middle East to the
Pacific (and so to China).
Iran happens to
be right in the middle, in Southwest Asia, with
all that oil heading toward an energy-hungry
modern Middle Kingdom over waters guarded by the
US Navy.
So yes, this larger-than-life
psychodrama we call "Iran" may turn out to be as
much about China and the US dollar as it is about
the politics of the Persian Gulf or Iran's
non-existent bomb. The question is: What rough
beast, its hour come round at last, slouches
towards Beijing to be born?
Note 1. The BRICS
countries are Brazil, Russia, India, China and
South Africa.
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