This page has been archived and commenting is disabled.
Guest Post: Iran Opens Oil Bourse - Harbinger Of Trouble For New York And London?
Submitted by John Daly of Oilprice.com
Iran Opens Oil Bourse - Harbinger of Trouble for New York and London?
The last three years of global recession have dealt a major blow to American capitalist ideas trumpeted throughout the world on the value of “free markets.” Wall St has been revealed as a form of casino economy, with the bankster insiders gambling with other people’s, and eventually, the government’s money in the form of bailouts. As the Republicans in Congress, scenting victory in the 2012 presidential elections, hold a gun to the Obama administration’s head and rating agencies consider downgrading U.S. government bonds in light of Washington’s possible defaulting, many ideas around the world that previously seemed implausible because of the dominance of the U.S. economy are garnering renewed interest.
Not surprisingly, many of these concepts originate in countries not enamored with Washington’s influence, perhaps none so more than “Axis of Evil” charter member Iran, which has seen its economy hammered by more than three decades of U.S.-led sanctions. Now Iran is working a program, that, if it succeeds, could help undermine the dollar’s preeminence as the world’s reserve currency more effectively than a Republican filibuster.
Iran’s sly weapon against the Great Satan’s currency? An oil bourse on Kish Island in the Persian Gulf, which has now begun selling high-grade Iranian crude oil.
Mohsen Qamsari, deputy director for international affairs of the Iranian National Oil Company was modest about the exchange’s initial capabilities, saying, "The commodity stock exchange has been pursuing a mechanism for offering crude oil on the stock exchange for a long time, and it has taken the preliminary steps, to the extent possible. Considering the existing banking problems, foreign customers are not expected to be taking part in the first phase of offering crude oil on the stock exchange, and this will be done on a trial basis. Today Bahregan heavy, high quality, low sulfur crude oil with less sourness will be offered on the stock exchange for the first time. In the first phase, a 600,000 barrel shipment will be offered."
Given that the world currently consumes roughly 83 million barrels of crude oil each day, the initial oil offerings at the Iranian stock exchange are hardly going to make or break the market, but they do represent an attempt by a significant oil producer to divert revenue streams from New York Mercantile Exchange, the world's largest physical commodity futures exchange, which handles West Texas Intermediate benchmark futures, and London's Intercontinental Exchange, which deals in North Sea Brent. All trades are in dollars, effectively giving the U.S. currency a monopoly.
The Kish Exchange dates back to February 2008, when instead of Tehran, Kish was chosen because it had designated as a free trade zone. The Exchange was set up to trade contracts in euros, Iranian rials and a basket of other currencies other than dollars. The previous year, Iran had requested that its petroleum customers pay in non-dollar currencies. But the Exchange initially traded contracts only for oil-derived products, such as those used as feedstocks for plastics and pharmaceuticals. Now the institution has taken the next step.
Even as Congress remains tone-deaf to the recession’s effect on American jobs and the economy, others have taken careful note. On 17 June 2008, addressing the 29th meeting of the Council of Ministers of the OPEC Fund for International Development in the Iranian city of Isfahan, Iranian President Mahmoud Ahmadinejad told those in attendance, "The fall in the value of the dollar is one of the biggest problems facing the world today. The damage caused by this has already affected the global economy, particularly those of the energy-exporting countries. ... Therefore, I repeat my earlier suggestion, that a combination of the world's valid currencies should become a basis for oil transactions, or (OPEC) member countries should determine a new currency for oil transactions."
What it would take for Iran’s new exchange to survive and flourish are some heavy-duty customers that Washington would be wary of picking a fight with, and Tehran already has one – China.
China, the world's largest buyer of Iranian crude oil, has renewed its annual import pacts for 2011. In 2010 Iran supplied about 12 percent of China's total crude imports. According to the latest report of the China Customs Organization, Iran's total oil exports to China stood at 8.549 million tons between January and April 2011, up 32 percent compared with the same period last year. Iran is currently China's third largest supplier of crude oil, providing China with nearly one million barrels per day.
China simply ignores Washington’s squeals about sanctions, but it is concerned about the bottom line, and unless Iran makes its oil prices more attractive versus competing supplies from the rest of the Middle East or South American exporters, it may be hard for the OPEC member to boost its share in the rapidly expanding Chinese market.
Enter the Kish Exchange.
China's Ambassador to Tehran Yu Hung Yang, addressing the Iran-China trade conference in Tehran on Monday, said that the value of the two countries' trade exchanges surged 55 percent during the first four months of 2011 over the same period a year ago to $13.28 billion and further predicted that the figure would surpass $40 billion by the end of the year.
So much for sanctions, eh?
So, while Washington prepares to commit political hara-kiri, Iran is preparing to take away a little of the capitalist glow from New York and London. If the Chinese decide to start paying for their Iranian purchases strictly in yuan, expect the trickle away from the dollar in energy pricing to become a stampede. That ought to give Washington politicos an issue to think about besides gay marriage.
»
- 19189 reads
- Printer-friendly version
- Send to friend
- advertisements -
Bomb these motherfuckers into the Stone Age. The world is long overdue for a balancing act, which is major Kinetic Action™. Booyakasha. :)
Oh, how we tried... water supply poisoning, privatisation of water sources, even rainwater in third world countries, small-scale conflicts with civilians being the targets most of the time for those AH-64s and GBUs... nothing seems to work in bringing the equilibrium we all so desire - time for another world war, gentlemen.
My post from a year ago...
"Iran made a big deal about it's satellite launch in March 2010, specifically about the U shaped trajectory, the 1000 km orbit zone and the 100 kilogram payload. Substitute the rat, turtles and worms with 100 kilograms of small ball bearings packed around a shaped charge. Detonate in high orbit. Say goodbye to a lot of satellites. Just a theory."
Ever wonder why the surveillance ones are 22,300 miles up ?
or why the U.S seemingly shut down the Shuttle program without a replacement.
or why the U.S. is a relatively minor player in the I.S.S.
The plot thickens...
"Ever wonder why the surveillance ones are 22,300 miles up ?"
Because they are in a geostationary orbit, orbitally 'locked' with the Earth and appear motionless to the observer from said Earth: you don't have move the instruments on board to find your targets, or even relocate entire satellites to get to the place you're looking to survey.
In fact, I bet, there's 10 of these over your house this very minute - nice polka boxers.
P.S. A better illustration of a geostationary orbit can be expressed by the phrase, "Annuit Coeptis... Novus Ordo Seclorum." A secular world, where you won't take a shit without someone watching you on CCTV, a better world in my opinion; a world where I can leave my private property on the street of any city on the face of this planet and not have it stolen - but that world is a few years away, gotta wait for the RFID with all of your biometrics & bank accounts, and a cashless world (reserve) currency to be implemented first, you commit a (petty) crime, your RFID gets turned off. LOL.
E.F thanks for the reply...
all the points you retorted with are valid, albeit a few more steps down the road, maybe...
The gist of my post is that Iran has a "poor mans" answer to any all out attack...from anyone...
There were times in our Nation's Military where it became necessary to move towards a Nuclear Fight.
That was then. Today there are States like Iran who are more than willing to lob a big one and vaporize something pretty damn important to the Free World. I wonder if Obama has the backbone to carry on through with a strike that will turn Iran into a sea of glass or a major city into a pillar of fire that sits on the edge of space.
Supposidely Satellites can read the writing on the VIN plate inside my windshield from space. Big deal. Now when you advance a few years and bring out the mark of the beast, I will not be having any of that. And be too old to care anyway.
"There were times in our Nation's Military where it became necessary to move towards a Nuclear Fight."
Japan doesn't count, maybe you mean a standoff ??? Like since, let me think... 1945...
A defensive weapon is only a problem,... to an aggressor...
Iran, on its own, does not have anything to counter an invasion (of tactical nukes).
http://www.longwarjournal.org/threat-matrix/images/syria-nuke-site-sat.jpg
Now you see it, now you don't - Syrian nuclear (research?) facility site, with Iran you'd have to use nukes on their refineries, basic infrastructure, airfields, large ground forces gatherings etc. It needs to be a glorious Dawn, a few GBUs won't do. :)
I believe this Iran oil exchange is a very significant development... from an international perspective - the outside looking in - this is a body blow to the $USD akin to QEx (?)...
Saddam Hussein was invaded by the US because he started selling oil in EUR.
Ghaddafi was invaded because he planned to sell oil vs gold :
http://www.youtube.com/watch?v=GuqZfaj34nc&feature=share
It's all about dollar hegemony and control of M-E oil to contain China.
Ghaddafi was also constructing an artificial river in the desert - we can't have self-sufficient, prosperous Arabs in that region; I mean, there are 40 million people in the Nile delta in Egypt, all of them shitting in the river, with millions of homes standing 300 metres from the Great Pyramid! Can't have that.
old news
Iran + nukes = banksters can no longer print money when US largest import is oil because of risk of hyperinflation. It only works when they force oil producers to take the hit.
but too late, banksters already took the bonus.
It is all about wall st's paper money and control of commodities mainly oil
It's never been about paper, you're a poor student of Aldous Huxley. :) Do tell why this crisis was engineered - paper profits? If you need to start a war, without the general populace suspecting it to be an engineered conflict, then start a trade war with paper and wait for December 7th, 1941. *The best is yet to come*
I think the Iranian "bourse" is a sideshow.
But things could heat up real quick if El Maximo Lider Hugo Chavez gets through his chemo and announces from Havana that henceforth Venezuela's crude will be traded from Iran and in euros or yuan only.
Cheered on by his "Brother in Arms" Ahmadinejad, Chavez will dare the U.S. to do something about it - and since the US Army needs a change of pace from Iraq/Afghanistan, a land war in Latin America might be just the thing.
Let's see ... jungles, rice paddies, guerrillas, swamps, and hostile locals..I think we've seen this movie before...
"The last three years of global recession have dealt a major blow to American capitalist ideas trumpeted throughout the world on the value of “free markets.” NOT!
The major blow that was actually dealt was to government intervention into the free market system. And the added intervention since the start of the global recession has only made it worse.
It think it was Santayana who is credited with saying that the lesson learned from history is that we don't learn from history. But I could be wrong..... about the attribution of the quote that is.
Are we talking about $500 oil if missles get fired this fall?
Cessation of trading, followed by Price controls and rationing.
"with the bankster insiders gambling with other people’s, and eventually, the government’s money in the form of bailouts"
The government has no money, it's the taxpayers' money that is being gambled with!
We are going " Popeye" on this theme! Whimpy: I'll gladly pay you for a burger today, on Tuesday.
Popeye: There ain't no CONTANGO on burgers, and I'll give you some 'Foot in Mouth', if you don't have that [ TAR BALL ] crew here Yesterday/ Poof.......
Why would anyone trust the integrity of that market for their futures trades? What are their margin requirements and protocols? Can you even find a broker that has access to this bourse? The US, London and Asian futures markets are just fine, thank you. Foreign traders don't even pay US tax when they trade in our markets, so why go elsewhere?
The author has it correct, fag marriage is at the top of the media distraction list, expect nothing in the direction of benefitting the biologically sound with their daily lives such as war, money and energy policy.
Who's gonna try to dry-fuck who in the name of "selfishness and blame" is much more important.
The symptoms are almost biblical as this place turns to ashes while US adversaries watch patiently.
"The Kish Exchange dates back to February 2008" - So why is it an issue now please ?