Lately, the western media, controlled and run by
Zionists, has been talking about re-imposition of economic sanctions on Iran,
as 12th May is approaching. The move has been initiated by the US
president and many ‘me too’ are trying to please him. The crusade is led by
Israeli prime minister, who is licking wounds caused to Israel in Lebanon by Hezbollah.
The US is also adamant at taking revenge of its defeat in Syria, where it also faced
Hezbollah. The west is never tired of accusing Hezbollah being supported by
Iran but it is in no way part of Islamic Revolutionary Grads of Iran.
The US commentators have very cunningly convinced OPEC
led by Saudi Arabia to curtail crude oil output which has resulted in 1)
substantial increase in crude oil price and 2) significant hike in the output by
the US and Russia. At present, Saudi Arabia has slipped to third position in
terms of daily oil output. The US has also emerged as one of the major exporter
of crude oil. Therefore, Iran with a daily export of 2.6 million barrel has
become ‘of no consequence’. Even if export of oil from Iran is stopped completely
completely, it would be compensated by other producers very quickly.
As a daily ritual, I have to write a few lines on
commodities market and factors driving their prices. The most bizarre part is
writing about the factors driving crude oil prices. The usual jargons used are increase/decrease
in rig count in the US, movement in US stock piles, turmoil in Venezuela and MENA
(countries including Iraq, Libya, Nigeria). Little reference is made to
investment by hedge funds.
I still remember once taking part in a live panel
discussion on factors driving crude oil prices (more than ten years ago) I had
said, “The price of crude oil may be driven by any factor, but certainly not by
demand and supply”. I could see the
signs of disgust on the face of moderator. After the show was over he even went
to the extent of saying, “Mr. Kazmi, today you said something which sounded
totally absurd and I could have responded. However, I kept quiet and gave you
benefit of doubt.”
Moral of the story is developed economies, through hedge
funds make millions of dollars through movement in crude oil prices. To achieve
their target they often breach agreements. Super powers are notorious for breaching
the agreements to achieve their ulterior motives. Therefore, re-imposition of
sanction on Iran will not be a surprise but an example of yet another blatant
violation. However, they must not forget that even stopping oil export from
Iran completely will neither make an immediate difference for Iran nor sky
rocket the oil prices.
