In the wake of so many wasteful, inhumane and disastrous foreign policy failures, the U.S. government has been desperate to highlight some significant successes in order to justify all of these tragic foreign imperial blunders. One such supposed success relates to education in Afghanistan, an area into which some $1 billion in taxpayer money has been spent to build schools and pay teachers according to Buzzfeed. U.S. Government officials have consistently trumpeted all of the good work that has been done in this regard, but there’s one slight problem. Not only are most of the statistics complete bogus, but in many cases, a lot of this U.S. wealth that was meant to be targeted for education, has gone straight to the coffers of some of the most ruthless warlords in the county. How could this happen you ask?
Forget the mad spinning. Here it is, in a nutshell, what it really takes for Iran and the P5+1 to clinch a game-changing nuclear deal before the new July 7 deadline.
As we recently noted, Russia and Saudi Arabia appear oddly allied in recent weeks. What happens when two nations, that together account for more than fourth quarter of global oil production, begin collaborating on future energy projects?
We previously warned of the risks of escalation in The Middle East to something much more dangerous, but, as the Saudi ambassador to UK confirmed today, the risk of Wahhabis going nuclear is even higher than many expected, "...if [Iran will not offer assurances it will not pursue nuclear weapons], then all options will be on the table for Saudi Arabia... Iran’s nuclear program poses a direct threat to the entire region and constitutes a major source and incentive for nuclear proliferation across the Middle East, including Israel."
That Makes Sens ... Wait, WHAT??
"The oil rebound has run out of gas and now you are seeing nervous investors with itchy trigger fingers bailing out of USO," notes Bloomberg, as the biggest US ETF that tracks oil is heading for the largest two-month outflow in six years, raising concern that crude’s 30% rally may stall. As BNP points out, "we do not think that the bulls have enough supporting fundamental factors to make a case for a higher oil price," and judging by the mass exodus from USO, as Bloomberg concludes, knife-catching 'investors' "don’t want to get burned by another drop in oil."
In a move that could shake up the dynamics of the global oil and gas industry, the desert Kingdom is restructuring its national oil company, Saudi Aramco.
Update 2: Curiously, while we were confident Iran would deny the report first, it was in fact the US: US NAVY DENIES CONFRONTATION WITH IRANIAN MILITARY: CNBC
Update: WHITE HOUSE REFERS COMMENT ON IRAN SHIP CAPTURE TO DEFENSE DEPT
Moments ago according to Saudi-owned Arabiya news, Iranian forces have seized a US cargo ship, which has some 34 American sailors, which they have taken to the port of Bandar Abbas. Iran's Farsnews confirms the Arabiya report, stating that "a US cargo ship with 34 crew was stopped and seized by Iranian Navy warships on Tuesday. The Iranian Navy has confiscated the American trade vessel with all its 34 crew for trespassing on Iran's territorial waters in the Persian Gulf."
In the same style as we have grown used to around the world, a major negotiation has ended with all sides claiming victory and no sides offering any actual solutions. Iran proclaims the talks have made "significant progress," yet Western diplomats are saying progress is "limited," only to be confused even more by Iran's Foreign Minister stating that "but still we have not agreed on the reviewed solutions." So in summing it all up, a press conference will be held shortly to explain that 'they agree on the outline of a plan which will pave the way for an agreement but aren't sure how much of the plan or hypothetical agreement they want to share'. New normal geopolitics... no deal is the new deal.
Saudi Arabia Imposes Naval Blockade On Red Sea Strait, Deploys 150,000 Troops As Iran Condemns Military ActionSubmitted by Tyler Durden on 03/26/2015 07:51 -0400
As noted earlier, the biggest significance of any Yemen conflict has little to do with its own domestic oil production, which at 133,000 bpd is negligible, but due to its location, which not only shares a border with Saudi Arabia, but more importantly due to the Bab el-Mandeb strait which connects the Red Sea with the Gulf of Aden: it is the fourth-biggest shipping chokepoint in the world by volume (3.8 million barrels a day of oil and petroleum products flowed through it in 2013) and is just 18 miles wide at its narrowest point. It’s located between Yemen, Djibouti, and Eritrea, and connects the Red Sea with the Gulf of Aden and the Arabian Sea. And since to Saudi Arabia preserving the logistics of oil supply is critical, it is hardly surprising that as Egypt's Ahram Gate reported earlier, the Saudi-led Firmness Storm coalition imposed a naval blockade on Bab El-Mandab strait earlier today. The Saudi navy's western fleet has also secured Yemen's main ports including Aden and Midi.
The only news that matters to algos today is whether Janet Yellen will include the word "patient" in the FOMC statement as a hint of a June rate hike, even though the phrase "international developments" is far more important in a world in which everyone (such as the 25 or so central banks who have cut rates in the past 80 days) is now scrambling to export deflation to everyone else. And with carbon-based traders recuperating from St. Patrick's day, few will notice that the oil tumble continues as WTI touches new 6 year highs after yesterday's shocking 10MM+ API build, and is now openly eyeing a collapse into the $30s. Just as nobody will notice that even as futures in the US and European stocks are looking a little hungover ahead of the Fed and perhaps on the latest bout of anti-austerity out of Europe, the China levitation has gone full retard, with the SHCOMP up another 2.1% yesterday and now in full-blown parabolic mode as housing data confirms the Chinese housing bubble has truly burst, and as shadow bankers dump all their funds into stocks in hopes of making up for losses due to regulatory intervention.
Amid the to-ing and fro-ing of John Kerry and the nuclear program negotiations, it seemed quite ironic that Iran would unleash a major naval drill near the strategically vital entrance of the Persian Gulf. As AP reports, more than a dozen swarming Iranian speedboats assaulted a replica of a U.S. aircraft carrier, as the Guard's navy chief, Adm. Ali Fadavi, who last month boasted that his force is capable of sinking American aircraft carriers in the event of war, said on state television, "American aircraft carriers are very big ammunition depots housing a lot of missiles, rockets, torpedoes and everything else."
Israel and Hezbollah are at war. On top of everything else that is going on in the world, now we have a new war in the Middle East, and nobody is quite certain what is going to happen next. Israel has been preparing for this moment for more than 8 years. So has Hezbollah...
Several days after a Japanese hostage held by the Islamic State was executed, with a second Japanese hostage, freelance journalist Kenji Goto likely awaiting the same fate unless the Jordan releases an ISIS prisoner, the middle eastern US-ally is about to dramatically breach western protocol of not negotiating with terrorists, and as the newswires reported earlier, is prepared to exchange said imprisoned ISIS would-be suicide bomber, however not for the Japanese captive of ISIS but for one of its own pilots held by the Islamic militants.