The latest development in the neverending saga of Iran, comes via the Middle East Media Research Institute (MEMRI) which states that according to the Gulf states, the military option may be the best option to deal with the Iranian nuclear program, as the contra-Iran (no pun intended) axis is now complete. The article also reflected "the Gulf states' growing tension and concern regarding Iran's nuclear program, and mentioned their proximity to the Bushehr reactor." What is scary is that the straw man of military intervention is pretty much presented as a fait accompli, and alternatives to military intervention are not even considered as an option. The timing could not be worse: as we highlighted earlier, John Bolton believes that there is ticking clock (through the 21st) after which the option of "striking" Iran with manageable casualties becomes negligible. And lastly, and certainly not making matters any easier, was the earlier revaluation by AFP, that Iran is preparing to unveil an array of weapons next week. An impartial reader would be forgiven if left with the impression that at this point a military operation is all but granted. Yet, keeping an eye out on spot oil, indicates that the realistic chance of an incursion is still negligible, at least as judged by oil prices. We believe that is still one of the best advance warnings indicators of a geopolitical shift. Unfortunately, if the oil market is in any way comparable to stocks in its predictive ability, it just may be that oil is, for once, a reactionary indicator instead of forward looking, in which case it will be useless as a predictive force.
An editorial in the Saudi daily Al-Madina, published in the wake of announcements in Iran and Russia regarding the imminent activation of the nuclear reactor in Bushehr, took a hard line vis-à-vis the Iranian nuclear program, claiming that the military option may be the best way to deal with it. The article reflected the Gulf states' growing tension and concern regarding Iran's nuclear program, and mentioned their proximity to the Bushehr reactor.
Following are excerpts from the editorial:
"Tehran's [August 13, 2010] announcement, confirmed by Russia, that an Iranian nuclear reactor would be inaugurated this month in Bushehr, on the Arabian Gulf coast, and that it would be equipped with fuel and would operate as a nuclear facility, is an indication that the region is now entering a new phase.
"In taking this action, Tehran is ignoring all the advice, warnings, and requests to halt its nuclear program, or at the very least to try to continue it under clear and open international inspection that would guarantee that it does not have a military facet. If [Tehran] insists upon going ahead [with the program] without the agreement of the international community, it will bring embarrassment and suspicion upon every [country] that supported [Iran's] right to peaceful nuclear energy.
"More importantly, by means of this action, Tehran is moving its conflict with the international community into high gear, and [in this case] some may consider the military option to be the best solution. [Delaying recourse to this option] may lead to a point where it is impossible to implement it – if Tehran manages to produce a nuclear bomb of its own.
"What is of concern is [the fact] that the Bushehr reactor is closer to several Gulf capitals than to the Iranian capital itself, as well as the fact that it is very near the crucial oil routes which pass through the Arabian Gulf – placing the neighboring countries in great danger, both in the event of an attack and in the event of radioactive leakage. Moreover, [the Bushehr reactor] may become the site where Tehran will develop its nuclear weapons, which it may use to impose demands or exert pressure on the region. This is a suspicion that Iran has not managed to refute to date.
"If Tehran is interested in the success of its nuclear program for peaceful purposes, and if it wants to make progress in order to ensure prosperity for its people, it must maximize its cooperation with the IAEA. The IAEA, for its part, must display a little flexibility with Tehran, since... equipping the reactor with nuclear fuel is the point of no return. When this happens, the Bushehr reactor will become a facility for nuclear energy.
"All parties must be judicious in confronting the new situation, and must make sure that the inauguration of Bushehr is not a preamble to disturbances or tremors in the region."
 Al-Madina (Saudi Arabia), August 15, 2010.
And confirming that Iran will not take any incursion lightly, is the following from AFP:
Defence Minister Ahmad Vahidi said on Tuesday that Iran will unveil next week an array of weapons, including missiles, speedboats and a long range drone, the ISNA news agency reported.
Two missiles, Qiam (Rising) and the third generation Fateh 110 (Conqueror) would be tested next week when Iran marks the annual government week, Vahidi said in reference to the Iranian week which starts on Saturday.
Iran will also unveil the long-range drone, Karar, he said using the nickname of revered Shiite Imam Ali.
On Sunday Iran launches its annual government week which runs until August 30 and is an occasion to showcase Tehran's achievements.
Iran has previously paraded a version of Fateh 110 which has a travel range of 150 to 200 kilometres (90 to 125 miles), but the range of the surface-to-surface Qiam missile was not reported by ISNA on Tuesday.
Vahidi said production lines of two missile-carrying speedboats, Seraj (Lamp) and Zolfaqar (named after Imam Ali's sword) would also be opened next week.
Vahidi said the unveiling of these weapons indicate that "sanctions have had no impact on us, but made us more experienced and self-sufficient."
Iranian officials regularly boast about the Islamic republic's military capabilities and Vahidi's announcements come at a time when local officials have been warning against any attack on the Islamic republic.
Tehran's archfoes, the United States and Israel have not ruled out a military strike against Iran to stop its controversial nuclear programme.
Last week a top commander from the Revolutionary Guards said Iran will mass produce replicas of the Bladerunner 51, often described as the world's fastest boat, and equip them with weapons to be deployed in the Gulf.
Also on August 8, Iran took delivery of four new mini-submarines of the home-produced Ghadir class. Weighing 120 tonnes, the "stealth" submarines are aimed at operations in shallow waters, notably in the Gulf.