Guest Post: Possible Reaction Scenarios To A Preemptive Israeli Strike On Iran

Tyler Durden's picture

Submitted by Bradley Schaeffer

Possible Reaction Scenarios To A Preemptive Israeli Strike On Iran

I have written in the past about the prospect of a nuclear Iran and its destabilizing effect in the world’s most important energy region.  But what if Israel strikes before Tehran’s nuclear ambitions are realized?  Although given that Iran currently could have as many as 8,000 centrifuges enriching uranium by December (IAEA estimate),  an Israeli strike now, as opposed to say 2003 when the secret program was first revealed, may not effectively shut down the decentralized program.  Still, it could cause a frustrating delay in Iran’s timetable and, depending on the line the mullahs take immediately succeeding the attack, weaken the regime’s hold on a populace that is more educated, more worldly, more pro-Western and less easily cowed than others in the region as the green protests last year revealed.

The (literally) billion dollar question of course for commodities traders  is what will be the effect on the price of global energy in the immediate and longer dated aftermath of such a military strike?  As with the current diplomatic stand-off today, much of that will depend on Tehran’s reaction.  Here are three possible scenarios should we wake up to news of Israeli fighter-bombers winging away from Natanz, leaving a burning nuclear facility and a thousand questions in their jet wash behind them.  

Best case scenario: Iran plays the victim.  Instead of striking back militarily, Iran uses the attack to show the world that Israel and her puppet-master the United States are the aggressors.  The mullahs may even use such an attack to shore up their public support at home. "It may make sense for the Iranians to play the victim," said IHS Global Insight Middle East analyst Gala Riani. "They may also use it to build the regime's legitimacy internally."  Sure, they would angrily denounce the criminal raids, invite the international press to view the destroyed buildings and, of course, the hospitals treating the inevitable civilian casualties and the very public funerals that would follow.  But in the end, especially if the damage is minimal, they may try to turn this military lemon into p.r. lemonade.  I would expect a mild knee-jerk rally in crude oil (depending on the base price at the time of the strike).  Call it $5.00 to $15.00 but I think any rally will be brief and a selling/shorting opportunity if anything.

Mid-case scenarios:  Iran could retaliate in one of two-ways (or both) short of major escalation of violence.  They could intensify their proxy war against the United States and her allies in Afghanistan and Iraq as well as Israel in Lebanon and the Palestinian territories through Hezbollah and Hamas respectively.  Such actions’ short-term impact could have a similar impact on crude prices as the best-case victim scenario, especially if the attacks focus on Israel which is already under the gun so to speak.  Although Israel has threatened to hold Syria and Lebanon responsible for any Hezbollah attacks, in the end it will be the intensity of the attacks and level U.S. support for retaliatory actions that will determine the degree of escalation such a declaration could imply. 

It must be noted however that should there be a marked increase in violence against Western forces, especially beyond the immediate areas of Gulf conflict, and particularly militant-launched attacks on oil-focused targets such as refineries, pipelines, and the like, global tensions could rise quickly.  This is especially true if Israel waits until the new year when a more friendly Republican-controlled Congress (if predictions hold that is) may press the tepid Obama administration for a more punishing response to Tehran’s machinations.  In this case we could see oil’s floor set at perhaps $10-$20 or more higher than pre-strike levels and remain there for some time. 

Worst-case scenario:  Iran could react with great force, launching conventional warheads against Israeli targets while at the same time following through with its threat to close the Strait of Hormuz and choke off the most important maritime route through which 17 million barrels of crude oil move each day.  The immediate supply shock would send oil futures spiraling into the $140+ range (roughly double where they are now).   "Iran doesn't even need to be successful in their threat," said Michael Wittner, global head of energy research at Societe Generale. "Even a credible threat or near miss and insurance rates will spike. Then no one's going to send any oil through there for a couple of weeks until somebody's navy can re-establish control." 

Should the Iranians actually attempt to close the narrow sea lanes over which they frown, the United States Navy will be compelled to re-open them by force.  This will unleash unintended consequences that are anyone’s best guess.  Although Iran’s ability to maintain a blockade in the face of the most powerful navy in history is in doubt, certainly the price spike will hold as insurance rates skyrocket for a time and such costs are passed on to consumers.  Also re-routing the oil overland or drawing it from other regions will entail higher transportation costs and risks of their own.

Commodities derivatives are driven by uncertainty.  They are, in fact, risk management instruments to be used to mitigate uncertainties in just such scenarios as described above.  Uncertainty is inherently bullish.  I cannot conceive of a scenario in which oil prices will fall in the event of an Israeli strike that seems more and more likely by the day. 

Sadly, I do not see the current Iranian regime reacting rationally to such a strike and thus do I lean more towards the latter two possibilities I lay out above.  My advice, better to be long and wrong, for a while, then wake up short when the balloon goes up.  Demand for crude oil is not going away any time soon regardless…access to supplies, however, may soon be another matter entirely. 

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keating's picture

1. You are assuming that Israel uses a surgical strike. If Israel uses 2/3 of her nukes, she can toast most Iran cities.

2. You are assuming Iran could find the sender of the 100 nuclear cruise missiles, launched perhaps off the deck of an oil tanker. Israel might be the main suspect, but perhaps not, as Iran has a lot of enemies.

3. You are assuming that the Straits of Hormus are not mined. New "rising" mines are impossible to detect and  lethal even to military vessels.

Hang The Fed's picture

All other considerations aside, I don't really see Israel nuking Iran.  That would be a stroke that would inevitably result in a like-for-like retaliation, even if it took some time and was carried out by some clandestine faction with a suitcase bomb.  More likely, it would be the final straw in a region in which Israel is already seen as a peripherally legitimate state at best.

But...the surest reason is that it would render further drilling and refining operations in Iran an even more messy prospect than it currently is.  We like to think that political bodies are both savage and stupid, but I rather think it's more the former than the latter.  Short-sighted and arrogant?  Definitely.  Stupid enough to run the biggest Hail Mary since 1945?  Probably not.

I could be wrong, though...organized religion has made the Hatfields and McCoys look like a bunch of hippies by comparison over the course of history.

RichardP's picture

If someone nuked Iran and they nuked there own oilfields in response so that they were unworkable for several thousand years, would that not also cause problems?  There are all kinds of legitimate reasons not to nuke Iran and I'm sure the powers that be are hamstrung by all of them.  I'm thinking that industrial sabotage is going to be the means of controlling Iran's centrifuges.  If Iran really wants nukes, they can either buy the nukes, or buy the parts and assemble them themselves.

jeff montanye's picture

the premise of the post is preposterous:  if iran gets a nuclear weapon it "destabilizes" the region (whatever that actually means, probably that israel thinks it is marginally or more worse off:  the u.s. is so led around by the nose by that little troublesome country and its u.s. lackeys).  so how about israel attack iran in some way.  that certainly wouldn't destabilize anything.  no.  that ought to calm everyone down.  foreign attack, especially by the despised zionist entity, is a sure way of keeping the people from rallying to the government from which they are slowly becoming alienated.  in your fevered hebrew dreams.

TrulyStupid's picture

Every other country in the world recognizes that an attack by Israel is in fact an attack by the

US. The tail wags the dog... Presumably an Israeli strike would be followed by a US invasion

.. a la Iraq.. in order to make Iran free for corporate profits, which is the main motivater of US foreign policy.

The US would not raise domestic taxes to pay for the whole (no doubt botched) operation, so the printing

presses would be brought to bear... that's worked real well so far.

hound dog vigilante's picture

 

...in order to make Iran (or any other sovereign nation) free for corporate profits, which is the main motivater of US foreign policy...

 

This FACT cannot be repeated enough.

Americans must themselves recognize and then stop the taxpayer-funded corporate military-industial complex. This is the challenge of our generation - end corporate fascism.

 

Bringin It's picture

++ Hound Dog.  Find a way to stop paying taxes.  Don't participate.  Keeping one's hands clean is an individual choice.

israhole's picture

I'd have to disagree.  If anything, the US is Israel's beetch.  Ask yourself, do Americans run Israel, or do dual-citizens of Israel sit in our government?

 

Cathartes Aura's picture

"Ask yourself, do Americans run Israel, or do dual-citizens of Israel sit in our government?"

well, we know that the latter is true:

 

American / Isreali Dual Citizens Running the American Government

Attorney General – Michael Mukasey
Head of Homeland Security – Michael Chertoff
Chairman Pentagon’s Defense Policy Board – Richard Perle
Deputy Defense Secretary (Former) – Paul Wolfowitz
Under Secretary of Defense – Douglas Feith
National Security Council Advisor – Elliott Abrams
Vice President Dick Cheney’s Chief of Staff (Former) – “Scooter” Libby
White House Deputy Chief of Staff – Joshua Bolten
Under Secretary of State for Political Affairs – Marc Grossman
Director of Policy Planning at the State Department – Richard Haass
U.S. Trade Representative (Cabinet-level Position) – Robert Zoellick
Pentagon’s Defense Policy Board – James Schlesinger
UN Representative (Former) – John Bolton
Under Secretary for Arms Control – David Wurmser
Pentagon’s Defense Policy Board – Eliot Cohen
Senior Advisor to the President – Steve Goldsmith
Principal Deputy Assistant Secretary – Christopher Gersten
Assistant Secretary of State – Lincoln Bloomfield
Deputy Assistant to the President – Jay Lefkowitz
White House Political Director – Ken Melman
National Security Study Group – Edward Luttwak
Pentagon’s Defense Policy Board – Kenneth Adelman
Defense Intelligence Agency Analyst (Former) – Lawrence (Larry) Franklin
National Security Council Advisor – Robert Satloff
President Export-Import Bank U.S. – Mel Sembler
Deputy Assistant Secretary, Administration for Children and Families – Christopher Gersten
Assistant Secretary of Housing and Urban Development for Public Affairs – Mark Weinberger
White House Speechwriter – David Frum
White House Spokesman (Former) – Ari Fleischer
Pentagon’s Defense Policy Board – Henry Kissinger
Deputy Secretary of Commerce – Samuel Bodman
Under Secretary of State for Management – Bonnie Cohen
Director of Foreign Service Institute – Ruth Davis

Citizen of an IKEA World's picture

Playing "spot the Joooooo" this morning?

Good grief.

Bringin It's picture

What's your point clown?

Why don't you address the issue?

Cathartes Aura's picture
heya jeff - noticed your post was attracting the attentions, yeah, so I thought I'd repost it down here, to prevent a dis-appearing act - it's a good post, hate to lose it!
by jeff montanye
on Sun, 07/25/2010 - 00:06
#487355

 

the premise of the post is preposterous:  if iran gets a nuclear weapon it "destabilizes" the region (whatever that actually means, probably that israel thinks it is marginally or more worse off:  the u.s. is so led around by the nose by that little troublesome country and its u.s. lackeys).  so how about israel attack iran in some way.  that certainly wouldn't destabilize anything.  no.  that ought to calm everyone down.  foreign attack, especially by the despised zionist entity, is a sure way of keeping the people from rallying to the government from which they are slowly becoming alienated.  in your fevered hebrew dreams.

  • flag as junk (13) 
  • Hang The Fed's picture

    I just don't believe that any organization as cold, self-interested, and fundamentally greedy as any current government is would drop nukes on a "potential investment" as large as Iran, with its oil reserves.  But, as I said, maybe I'm wrong.  Rationality has been abandoned in so many different venues these days that predicting any given social or political event is a crapshoot at best.

    Testicular Cancer's picture

    Israel cannot strike Iran using an airstrike. The distances are too great & no Muslim nation will aid by either harboring or refueling Israeli aircraft. A commando strike is possible but the chance of success is low & the chance of return is negligible. That leaves nuclear missiles. I do not know if the Jericho missiles can reach the refineries.

    But note this guys, if the facilities are above ground & within range, then you can arm the missiles with conventional or better yet specialty munitions (like cluster munitions) and achieve the goal of stopping or at least delaying enrichment & weapons production! The accuracy of modern ballistic missiles are around 100 yards if not better (at least the American ones)! Lastly, if you go conventional, you have deniability! Now that I think about it, that is the most likely scenario. My god, did I just figure them out?

    AnAnonymous's picture

    I suspect Saudi Arabia to be willing to cooperate.

    If people want to look at a country running (or jetflying) into the wall, they must look at Saudi Arabia.

    They are growing more and more nervous by the day, living the fate of people who play consistently the best interests of someone else instead of theirs.

    This has led them to play against a majority of  theirs neighbours and worse, against themselves. Now they realised the trap they are in. 

    Iran emerging as regional power is bad news for them. Very bad. This could lead to a total shift in the area with Saudi Arabia being publically lambasted for their past behaviour.

    As they harbour the Mecca, Islam could be instrumentalized to finish them off.

     

    Saudi Arabia is going down the gutter and they definitively do not want a neighbouring country to take advantage of the situation.

    DosZap's picture

    AnAnon,

    "I suspect Saudi Arabia to be willing to cooperate."

    The Saudi's have already goven Izzy permission for flyover............several weeks ago.

    Scenario #3 is the one I see, and NO NUKES will be used........

    The US has already delivered around 11,000 Bunker Busters to the area.

    The only thing holding Izzy back, is the go ahead from the US.

    Iran, is not capable of blocking the Straits FIRST, and steps would be taken to ensure they would not get the Jump on the US to be there 1st........

    As for the 10,000 ship Iran navy, LOL....what a LIE.

    More ISALMIC Fundamental Horse Crap.

    Mother of all wars...........one thing I have learned from the Middle eastern tryrants,and Dictators is their unequalled penchant for BLUSTER..............

    Talk, does not scare strength..........ABILITY does.

    Now, IRAN is the weakest it will ever be...........if they are going to HIT them, best do it now.

    ObamBa could care less what the price of Oil goes to, the higher the better.........just helps his Agenda, for cutting Americans travel, and savings.

    AnAnonymous's picture

    I am not surprised. Saudi Arabia is really on the verge of self implosion.

    Always happens when you disregard your own interests to favour others'.

    Bringin It's picture

    Saudi Arabia is really on the verge of self implosion.  Always happens when you disregard your own interests to favour others'.

     

    Are you talking about Saudi Arabia or the US??

    hound dog vigilante's picture

    "...They are growing more and more nervous by the day, living the fate of people who play consistently the best interests of someone else instead of theirs.

    This has led them to play against a majority of  theirs neighbours and worse, against themselves. Now they realised the trap they are in..."

     

    You are describing Saudi Arabia here, but you could just as accurately be describing the USA - it's citizens held captive by a militarized multinational corporate government.

     

    Cathartes Aura's picture

    +++

    militarized multinational corporate government

    says it all.

    Citizen of an IKEA World's picture

    The distances are too great & no Muslim nation will aid by either harboring or refueling Israeli aircraft.

     

    That remains to be seen.

    Missing_Link's picture

    Israel cannot strike Iran using an airstrike. The distances are too great & no Muslim nation will aid by either harboring or refueling Israeli aircraft.

    Wrong.  Israel has developed UAVs with sufficient range to strike Iran.

    caconhma's picture

    People who seriously think about starting a nuclear war must be sent to mental institutions and/or into electric-chairs.

    Apparently, lessons of Korea, Vietnam, Iraq, Afghanistan, etc., were totally wasted. 

    As for Jews, apparently, for the last 2,000 years they also have learned absolutely nothing.

    It is just fucking incredible.

    Missing_Link's picture

    Nonsense; they've learned quite a bit.  They've learned how to survive in a land surrounded by enemies.  If they hadn't, they wouldn't have made it all these 2,000 years.  Thus, the development of long-range UAVs.

    Israel has a whole lot of tricks up its sleeve.  This is only one of them.

    JR's picture

    The history of the Jews is not the same as the history of the current state of Israel, which dates just to 1948.  The state of Israel was created and is sustained by unbelievable support and subsidies from other nations, including initial blocking of indigenous peoples by the British and now total protection by the world’s superpower.

    Should that support be withdrawn, the state of Israel would cease to exist.  In that we’re talking about a nuclear war now and we’re talking about the state of Israel, the country, and not the Jews, removal of that support is plausible.

    As to how much the Jews have learned, this extension of settlements is not a smart way to be running a country in the Middle East. There’s a difference between 2000 years of a Jewish people in constant need of political and subsidized support from host nations and running a modern state.

    Testicular Cancer's picture

    Only US UAV's carry Hellfire missiles. Even those dont carry enough firepower to disable a facility & fly such distances.

    Bartanist's picture

    Yes, and Israel then would be proven to be the rogue terrorist state that it claims Iran to be. If Israel does commit that kind of crime, then hopefully the retaliation from the rest of the world would be swift and final.

    fiddler_on_the_roof's picture

    Nothing will happen. Powerless people will hold some marches on the streets. That's
    All. People are slowing realizing that ordinary
    People don't influence any decisions. Look
    At the Lockeberie bomber released by
    Powers in control

    Missing_Link's picture

    So Bartanist, you're openly calling for the destruction of Israel; is that correct?

    caconhma's picture

    Yes, this will liquidate many problems for the USA and the rest of the world.

    Citizen of an IKEA World's picture

    Liquidate, eh?

    What a telling choice of word.

    Missing_Link's picture

    So many frothing-at-the-mouth little amchair Hitlers on ZH these days.  I am really starting to wonder about this site.

    hound dog vigilante's picture

    Israel is not a US state.

    Stop behaving like Israel's interests = USA interests.  Two different countries.

    Discussing the fate of Israel is not anti-semitic, so why villify the entire discussion?

    Israeli policy has been indefensible. It is neither irrational nor anti-semitic to question Israel or it's fate.

     

    DosZap's picture

    hdv,

    Then your taking the side of the Arabic counties, and Iran's??.( Frigging maniacs).

     

    Also,I call Bullshit on this..............

    " Stop behaving like Israel's interests = USA interests.  Two different countries."

    they have been our ONLY true Allie in that area for 60yrs

    RichardP's picture

    Remember it??  You guys won't let us forget it.  So I'll add to the chorus:

    Rember what the final investigative report said about the USS Liberty.

     

    Bringin It's picture

    Did you and your friends write the report?

    "A former Navy attorney who helped lead the military investigation of the 1967 Israeli attack on the USS Liberty that killed 34 American servicemen says former President Lyndon Johnson and his defense secretary, Robert McNamara, ordered that the inquiry conclude the incident was an accident.

    In a signed affidavit released at a Capitol Hill news conference, retired Capt. Ward Boston said Johnson and McNamara told those heading the Navy's inquiry to "conclude that the attack was a case of 'mistaken identity' despite overwhelming evidence to the contrary."

    http://whatreallyhappened.com/WRHARTICLES/ussliberty.html?q=ussliberty.h...

    DosZap's picture

    Missing,

    +1000

    This place seems to have more than it's fair share of  Anti Semites,that said, the good here far outweighs the FAR left fringe groups.

    I just wish ONE of these Israel haters, would step into their shoes........

    Not one time, have I seen Israel attack without provocation, I have never heard them threatening an Arabic, or Persian nation with TOTAL oblivion, by Nuclear weapons...........

    Nor START a war,police action, without damn good cause..........

    Don't most sane people think that Israel, IF left the Hell alone, would almost never be heard from?.

    You would think, yes.............

    But, NOOOOOOOOOOO............their A gnat on a camels ass in that part of the world, and if they did not have the Tactical Nukes as a deterrent, their asses would have been wiped put LONG ago.

    Logical thinking would seem to be that Israel is not, has not, been the PRIMARY aggressor's...........When you have several hundreds of millions of Arab's, and Persians, whose publically stated goal, is to totally destroy Israel, and to NOT recognize even their right to EXIST?.

    Yasser Arafat, in his entire LIFE, never wanted peace w/Israel, he wanted things his way, and the ultimate goal was elimination of the state of Isreal..always has been,always will be, till the END OF DAYS.

    The U.N., constantly votes against Israel, and the U.S.( Obama is gonna change that IF he get's time.)

    You have to wonder...........who's on the crack pipe.

    TrulyStupid's picture

    By the way, Arabs are a Semitic people. Is Israel violent anti-Semitic?

    WaterWings's picture

    How did Izzy get their nukes? Don't you think the America people should/would be outraged to learn the truth? The asymmetrical force Izzy employs against civilians is astounding...white phosphorus, anyone? Isn't that a war crime?

    Green Leader's picture

    The majority of posters here are smart people and can see what Israel is all about...they don't have to read The Protocols.

    The Zionist state of Israel is an illegitimate and impostor Ashkenazi-Edomite regime. Many sects of Judaism do not recognize it. The Edomites are the descendants of Esau and the Ashkenazi are NOT semites (descendants of Shem). The Ashkenazi are descendants of Japhet, sons of Gomer (Genesis 10:1-2).

    Google radiation experiment + Sephardic children.

    "Behold, I will make those of the synagogue of Satan who say that they are Jews and are not, but lie—behold, I will make them come and bow down before your feet and they will learn that I have loved you." Revelation 3:9

     

     

    Citizen of an IKEA World's picture

    ...hopefully the retaliation from the rest of the world would be swift and final.

     

    Perhaps we could call it Die Endlösung.

    israhole's picture

    I agree. Enough is enough out of Israel already.  The videos on youtube of the IDF and settlers terrorizing not just Palestinians, but shooting even Americans at point blank range (like on the Gaza aid flotilla) prove your point.  

     

    You won't see the controlled, mainstream media play any of these videos, but they are all over the internet.  Does anybody really think this is why Joe Lieberman wants to shut down the internet (for our own safety)?  Not me.

    Missing_Link's picture

    ^^ enough of this kind of hatemongering trash, I think.

    Oh, and as for the "peaceful" "aid" flotilla, what about the known terrorists on it, and then heavy weapons (http://www.flix.co.il/tapuz/showVideo.asp?m=3423928), and the knives used against the Israeli commandos?

    WaterWings's picture

    Knives against pirates in international waters? Those people had every right to use all necessary force to repel illegal boarding parties.

    DosZap's picture

    Bartanist,

     Excuse me but I think your full of crap.........and WAY over the top.

    "If Israel does commit that kind of crime, then hopefully the retaliation from the rest of the world would be swift and final."

    First & Foremost,I am sick and tired of Israel always getting hung with the BAD GUY tag.

    Answer me this.........

    WHO, has threatened to Destory Israel, and eliminate it from the face of the earth?.

    Answer: IRAN......how many times?...........lost count.

    So, where is the Crime, in defending your nations peoples, and your very existence?......................There is none.

     

     

    Secondly,

    Any world retaliation against Israel, would have to go thru us also......Not a thing anyone would take lightly........we may be dead dik broke, but we still have the most Mobile fleet of Military power on the Planet.........and the largest...............

    What part of the Muslim world are you from?.

    Weimar Ben Bernanke's picture

    Let me guess bomb bomb Iran till we are broke. We are deep in debt. Why the hell should we fight wars in the mideast that does not benefit us at all while our southern border is being overrun by paramilitary druglords. While Arizona is being held hostage we should bomb another nation in the benefit of israel? If Iran and Israel want to go to war with each other let em do. But we should not choose a side. We have given military aid to Israel,Palestian Authority,Egypt,Jordan,Saudi Arabia,Pakistan,Turkey for what??!! If Israel and Iran want to destroy each other let em do it. I am sick and tired of the mideast,we have a shitload of problems at home but we must continue being the"globocop" that will bankrupt us into ruin. As George Washington said "The great rule of conduct for us, in regard to foreign nations, is in
    extending our commercial relations to have as little political
    connection as possible... Why, by interweaving our destiny with that of
    any part of Europe, entangle our peace and prosperity in the toils of
    European ambition, rivalships, interest, humor, or caprice?... It is our
    true policy to steer clear of permanent alliances with any portion of
    the foreign world."

    Max Hunter's picture

    I'm not a Muslim.. Don't even know any.. You can be sure of this; Israel IS the bad guy. Always has been.. If I wake up one morning and my Internet is gone, I will be certain Israel attacked Iran.

    The terrorist state of Israel is slowly (but surely) losing it grip over consensus in the west. There is a groundswell of people once fooled, (like you) into thinking all Muslims and brown people are the enemy, but are now understanding they have been conditioned by the "owned" media outlets.

    You grossly underestimate the number of people that will jump on the RIGHT side of history and condemn Israel for the terrorist state it is..

    Zionist/Neo-con control is slipping.. I just hope there are enough light poles to hang all of these traitors from..

    I have personally unconditioned dozens from the false ideas they have grown up thinking and that the U.S. and Israeli policy is nothing short of terrorism against the rest of the world..

    We are growing, you are shrinking.. good luck with that..