As WTI Passes $105, Guardian Says Iran "Military Action Likely", Would Send Crude Soaring

Tyler Durden's picture




 

Between the Chinese 'surprise' RRR and the Iran export halt to UK and France (and escalating tensions), Oil prices are off to the races this evening. WTI front-month futures have just broken $105 (now up more than 10% in the last two weeks), the highest levels in over nine months and just 8% shy of the 5/2/11 post-recession peak just under $115. Brent (priced in EUR) remains off last week's intraday highs (as EUR strengthens) but still above the pre-recession peak but in USD it traded just shy of $121 - well above last week's peak. Of course, this will be heralded as a sign of demand pressure from a 'growing' global economy rather than the margin-compressing, implicit-taxation, consumer-spending-crushing supply constraint for Europe and the US that it will become in the not too distant future. As we post, The Guardian is noting that US officials are commenting that "Sanctions are all we've got to throw at the problem. If they fail then it's hard to see how we don't move to the 'in extremis' option." The impact of any escalation from here is gravely concerning with PIMCO's $140 minimum and SocGen's $150-and-beyond Brent prices rapidly coming into focus - and for those pinning their hopes on the Saudis coming to the rescue (and fill the Iranian output gap), perhaps the news that our Middle-East 'allies' cut both production and exports in December will stymie any euphoria.

From The Guardian: US officials believe Iran sanctions will fail, making military action likely

Growing view that strike, by Israel or US, will happen
• 'Sweet spot' for Israeli action identified as September-October
• White House remains determined to give sanctions time

"It's not that the Israelis believe the Iranians are on the brink of a bomb. It's that the Israelis may fear that the Iranian programme is on the brink of becoming out of reach of an Israeli military strike, which means it creates a 'now-or-never' moment," he said.

"That's what's actually driving the timeline by the middle of this year. But there's a countervailing factor that [Ehud] Barak has mentioned – that they're not very close to making a decision and that they're also trying to ramp up concerns of an Israeli strike to drive the international community towards putting more pressure on the Iranians."

Chart: Bloomberg

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Sun, 02/19/2012 - 20:09 | 2176166 Yen Cross
Yen Cross's picture

Haven't talked with anyone directly yet. But have heard some talk of  $110bbl immediatly off of current prices. That's WTI not North Sea ( Brent) which I would guess would jump to $122 ish.

Sun, 02/19/2012 - 20:27 | 2176216 ghengis86
ghengis86's picture

Now or never, remember? Like take that 9mpg Ford Expedition for one last load at Home Depot for the final touches on your flip house in Clearwater before your $2k in Obama/Bankster payola that won't buy much more than a few days/weeks time. Do you renew that Netflix subscription? Do you want to eat Alpo the rest of your life? Come on man!! It's now or never!!!

Sun, 02/19/2012 - 20:35 | 2176237 Michael
Michael's picture

I had a dream Israel was wiped off the map in a world war and nobody cared.

Sun, 02/19/2012 - 20:54 | 2176287 Xkwisetly Paneful
Xkwisetly Paneful's picture

KILL THEM ALL!

 

AFTERALL THE MIDDLE EAST WAS A PEACEFUL PARADISE FOR THOUSANDS OF YEARS PRIOR TO THOSE AWEFUL EVIL ZIONISTAS.

Asalam Alekem Brothers.

 

 

Sun, 02/19/2012 - 20:59 | 2176305 Comay Mierda
Comay Mierda's picture

You guys are fucking nuts. This is all part of albert pike's three world wars plan to establish a satanic world government. look it up

Sun, 02/19/2012 - 21:00 | 2176311 Tsar Pointless
Tsar Pointless's picture

Ahh - an Albert Pike reference. Loves it! A big +1 to you, my friend.

I'll name drop Nikola Tesla, just for shits and giggles.

Mon, 02/20/2012 - 01:23 | 2176860 SilverDoctors
SilverDoctors's picture

I can almost hear Bush and Cheney now....

Bomb bomb bomb....bomb bomb Iran!
Bomb bomb bomb....bomb bomb Iran!

This is not looking good.  With a Greek default less than a month away unless massive new printing can be agreed upon, it appears that the elite are instead choosing plan B: Start WW3 and blame Iran for the collapse.

http://silverdoctors.blogspot.com/

Mon, 02/20/2012 - 01:43 | 2176874 The Big Ching-aso
The Big Ching-aso's picture

 

 

I think we're about to get a crude awakening.

Mon, 02/20/2012 - 08:34 | 2177085 Dead Canary
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That's not punny.

Mon, 02/20/2012 - 09:42 | 2177187 mick_richfield
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Oil be the judge o' that!

Mon, 02/20/2012 - 02:49 | 2176932 sun tzu
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FYI - Bush and Cheney haven't been president for 3 1/2 years. Wake up, Rip Van Winkle.

Mon, 02/20/2012 - 05:29 | 2177005 Michael
Michael's picture

MSNBC news, CNN news, and FOX news has 320 million American's licking 6 million Israeli bung holes.

That's the way I see it.

Mon, 02/20/2012 - 07:55 | 2177059 JoBob
JoBob's picture

Michael, how's your anal fixation these days?

Mon, 02/20/2012 - 08:24 | 2177074 Think for yourself
Think for yourself's picture

Correction. It was plan A all along.

Albert Pike was not mentioned upthread for nothing. Hell, the masonic satanists outlined this in 1871.

 

Sun, 02/19/2012 - 21:03 | 2176325 Piranhanoia
Piranhanoia's picture

Do you mean Albert Shanker?

Sun, 02/19/2012 - 22:02 | 2176508 SwingForce
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Michael Schenker, UFO

Sun, 02/19/2012 - 22:47 | 2176607 Bolweevil
Bolweevil's picture

Rudolf Schenker, Scorpions

Sun, 02/19/2012 - 22:52 | 2176619 Gully Foyle
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Michael Shanks, Stargate

Mon, 02/20/2012 - 00:29 | 2176802 AldousHuxley
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US was going to do a quick strike with the drones, but realized that Chinese hacked the drone communication technology and gave it to Iran.

Moreover, Iran also has their own drones perhaps provided by Russia/China aerospace.

 

Russia and China said they will support Syria.....Iran's only friend in ME.

 

This is not some blacksheep Sadaam's Iraq or dirt poor Afghanistan with 100year history of foreign invasions.

Iran = ex-Persian empire....they know the game....so they beat US to it....

  • built nukes with smart scientists while Americans were flipping homes
  • invested in STEM education to come up with scientists to creat etheir own fighterjets and drones, while Americans rely on imported Chinese engineers who have no loyalty to upper echelon of USA (white old man)
  • created their own oil exchange away from dollar, while America used their scientists and engineers in financial engineering to invent MBS, CDS, CDO sales and high frequency trading bs.
Mon, 02/20/2012 - 01:29 | 2176866 Pinto Currency
Pinto Currency's picture

-

 

Just like the failed anchovy harvest in the 70s along with OPEC that caused the last inflation shock, it looks like those awful Iranians are going to cause another inflation storm now.

 

Don't mention the printing of trillions of paper dollars by Western central banks. 

 

The Iranians are doing this because they hate our freedoms.  Freedoms like the TSA crotch groping, FBI wiretapping, having the right to have a bank robosign away your title to your home, and all that stuff.

Mon, 02/20/2012 - 09:32 | 2177164 SWRichmond
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If only the average american "homeowner" knew how fucked up the chain of title was for residential proprty in the U.S....

Mon, 02/20/2012 - 11:33 | 2177479 MachoMan
MachoMan's picture

The chain of title is not remotely fucked up...  we know the owners of record for every property...  and, if incorrect (e.g. death of owner and failure by heirs to properly record conveyance to them), then affidavits can be used to fill in the gaps. 

The problem that we have is with potential clouds on the titles...

Note: who do you think is going to win, a bonafide purchaser, for value, of a home without a recorded assignment or a 15 level downstream assignee of a mortgage who has no real paperwork to prove the assignment?  Best case scenario, when the BFP closes and pays the lienholder of record, the last assignee has a cause of action against whoever got the proceeds... 

The law has a lot of safeguards built in...  and they're going to get ramped up starting this year, but especially next...  just watch.  (and you thought the banks were undercapitalized now...)

Mon, 02/20/2012 - 02:20 | 2176906 Michael
Michael's picture

Diversification is important.

Mon, 02/20/2012 - 02:55 | 2176939 sun tzu
sun tzu's picture

The Iranian built jet fighters will be wiped out in a couple of days. Their only hope is a guerilla war and attacks on US, EU, and Israeli soft targets around the world. They do have some decent SAMs from Russia and China, so that might protect them a bit.

Mon, 02/20/2012 - 09:22 | 2177137 Element
Element's picture

 

to create their own fighterjets

 

Let's not overstate it, they created a small fast-jet trainer, and put a gun and small bomb payload on it.

It's no more a fighter than a US, Brit or Russian trainer, with limited avionics, ground-attack options, and A2A weapons.

Those limited capabilities are there simply so these aircraft can fulfil their role as a combat and weapon trainer.

They would have almost no hope of getting into an effective firing position in any real battle, and zero hope of survival.

It will greatly assist Iran to design and develop a real second-tier fighter one day, and especially attack aircraft, and the necessary avionics etc., but they are coming from way behind.

My guess is they're going to buy latest-gen Russian or Chinese offerings in the interim, and a lot of very impressive precision missiles.

Barter is good.

China needs the oil and Iran needs a new first tier multirole attack aircraft, with real first-tier fighter capabilities.

I'm pretty sure they will find an agreeable medium of exchange, for such a trade.

Sun, 02/19/2012 - 23:46 | 2176731 redpill
redpill's picture

here I am...

Mon, 02/20/2012 - 01:55 | 2176884 TheFourthStooge-ing
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SwingForce said:

Michael Schenker, UFO

and Bolweevil said:

Rudolf Schenker, Scorpions

Rudolph Schenker and his seventeen year old little brother Michael, Scorpions:

http://www.youtube.com/watch?v=e1BGCechX3Y

 

Sun, 02/19/2012 - 23:19 | 2176674 Michael
Sun, 02/19/2012 - 21:09 | 2176359 CrashisOptimistic
CrashisOptimistic's picture

Probably not.

But folks might want to notice that it's late February.  The northern hemisphere's agricultural base is getting ready to buy fuel for the tractors that plant the food the world eats.  Planting season starts in just a few weeks.  They'll be buying at $110/barrel.

Think that food will be cheap this year?

Sun, 02/19/2012 - 21:14 | 2176373 UP Forester
UP Forester's picture

Long U.P. Speedbeef....

Sun, 02/19/2012 - 21:16 | 2176379 LetThemEatRand
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I'm sure it was just a coincidence that Corzine and his henchmen at MF Global largely destroyed the futures positions of said farmers.

Sun, 02/19/2012 - 22:34 | 2176575 sullymandias
sullymandias's picture

Think that food will be cheap this year?

Food prices? Maybe they will stay cheap via futures manipulations until a real shortage exists. 

Mon, 02/20/2012 - 09:35 | 2177171 SWRichmond
SWRichmond's picture

you can't eat paper food futures....

muahahahaha

Sun, 02/19/2012 - 23:11 | 2176654 Oleander
Oleander's picture

We just talking about this today. Our locally grown organic tomatoes will not seem so highly priced this year.  Imported fruits and veggies will become very expensive.  Grow what you can yourself. There are great container garden websites available now for those who can not plant a whole garden. 

Mon, 02/20/2012 - 01:22 | 2176859 DaveyJones
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was thinking about this too as I put in more garden space

Mon, 02/20/2012 - 09:34 | 2177169 SWRichmond
SWRichmond's picture

Also putting in more garden this year, doubling.  I love fresh veggies, not to mention having food...

Mon, 02/20/2012 - 10:23 | 2177297 pods
pods's picture

You really can grow alot of stuff in limited space if you try.  I usually start a dozen or so more cherry tomatoes than I am going to need, then give them away at work.  I was surprised at how excited people were when they would tell me that they tomatoes.  Going to run my long beans up the south side of the house this year to free up space in the main garden.  Got a second solar powered electric fence controller to keep the deer out.

Drip irrigation is so cheap nowadays that even those with little time in tougher climates can grow quite alot with minimum input.

pods

Mon, 02/20/2012 - 11:50 | 2177536 DaveyJones
DaveyJones's picture

the Australians have done some great work on low water agriculture. Organic content of the soil is KEY. Soil with 2% organic can hold 75 percent more water than soil with 1. It's a giant sponge principle and it makes common sense. You can also build systems to catch and retain the rain that falls - from tank systems to mere ponds and carve outs in the hills that let it slowly seep into the earth below. I'm amazed the southwest doesn't require this. Have you ever seen Greening the Desert with Geoff Lawton?

Sun, 02/19/2012 - 23:17 | 2176666 Bansters-in-my-...
Bansters-in-my- feces's picture

My goverment tells me that high fuel prices won't effect my food prices because food and fuel are not included in the Conumer Price Index,so with inflation not being a worry,////don't worry...../Sarc

Mon, 02/20/2012 - 00:06 | 2176761 SumSUN
SumSUN's picture

This isn't gonna affect plastic rice is it?

Mon, 02/20/2012 - 02:53 | 2176936 Matt
Matt's picture

Unfortunately, since plastic is a product of oil, yes, your plastic rice is going to cost more; however, real rice, if hand-harvested, will cost less if produced locally, so you may be better off with some white basmati.

Sun, 02/19/2012 - 21:11 | 2176365 Michael
Michael's picture

Sorry Albert, Michael's plan is now in effect.

The world's private central banks have been stuffed to the rafters with its member banks toxic waste. The central banks have so much toxic debt shit coming out of their ears they themselves created, they will blow themselves up into a quadrillion pieces leaving them and their member banks worthless, never to be heard from again.

I love it when my plans come together.

Sun, 02/19/2012 - 21:15 | 2176376 vast-dom
vast-dom's picture

go engrave some min wage swastikas you fucking loser hater.

Sun, 02/19/2012 - 22:35 | 2176579 sullymandias
sullymandias's picture

overall effort and attitude is good

Sun, 02/19/2012 - 22:45 | 2176602 vast-dom
vast-dom's picture

you know it! cleaning the retardo diaper and sputum off the 0h on a gorgeous Sunday evening listening to mellifluous tunes.

Sun, 02/19/2012 - 23:44 | 2176724 jeff montanye
jeff montanye's picture

some about here and elsewhere give anti-zionism a bad name but israel has a lot to answer for and answer for it, it will.

http://www.ijsn.net/home/

Mon, 02/20/2012 - 09:27 | 2177155 Element
Element's picture

Clarinet by any chance?

Sun, 02/19/2012 - 21:20 | 2176380 Xkwisetly Paneful
Xkwisetly Paneful's picture

KILL ALL THE EVIL POS ZIONISTAS!

Beyond being what should be naturally lawful imbecile,

being a jew hating doomsdayer is not unique or novel.

Aslam Alekem Brother Abdullah.

 

Sun, 02/19/2012 - 22:35 | 2176582 sullymandias
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you are a troll

Mon, 02/20/2012 - 01:26 | 2176863 DaveyJones
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(And not a very good one)

Do NOT follow this link or you will be banned from the site!