Just six months ago, Israeli chief of staff Dan Halutz and Prime Minister Ehud Olmert were riding high. On July 12, they had launched what they were still convinced would be the knockout blow from which Lebanese Hizbullah and its Iranian allies/backers would never recover… And on July 17, despite some early signs on setback in that war, they still seemed very upbeat about its prospects of success…
Now, six months later, how are the mighty fallen.
I wrote a long essay in Boston Review about how the flaws in the concept that Halutz used in the war were considerably magnified by the chaos in the decisionmaking of Israel’s national command authorities at the highest level… And the result was a humiliating battlefield and strategic reverse for Israel, which damaged all portions of the Olmert government very seriously.
That damage has continued to play out in the Israeli body politic in the months since the August 14th ceasefire. Israel’s “Winograd” state commission of enquiry into the whole Lebanon episode still continues its work, after an earlier inside-the-IDF enquiry delivered a stinging indictment of the role of the chief of staff…
Halutz finally, today, submitted a resignation that in the view of many Israeli observers was long overdue. Amos Harel wrote in Wednesday’s HaAretz:
- Now, Olmert and Defense Minister Amir Peretz will need to overcome their mutual loathing and decide quickly on Halutz’s replacement. If a lengthy inheritance battle develops, that will only deepen the IDF’s depression.
Harel also wrote,
- by resigning now, [Halutz] increases the pressure on his partners in the war’s failed management, Olmert and Peretz, to follow suit.
Olmert is at political risk not only from the continuing work of the Winograd Commission, not only from his continued humiliating position in the opinion polls and the apparent collapse of the brand-new political party that he heads, “Kadima”… On Tuesday, state prosecutor Eran Shendar announced he had
- ordered the police to begin a criminal investigation into Prime Minister Ehud Olmert, on suspicion of having tried, in his former role as finance minister, to influence a tender for the sale of a controlling stake in Bank Leumi.
So there we have it. A fateful time for Israel, indeed, with its national command authorities in a large degree of internal turmoil and disarray and public confidence in the political leadership at rock bottom.
A situation, I should add, that is also mirrored to a great extent in a Washington whose main center of power– in the Vice President’s office– seems to march in near political lockstep with its friends in Israel..
For these reasons, over the past day or two I have again become much more concerned about the launching of a “Wag-the dog” scenario. Desperate times might lead to a truly “desperate” search for remedies.
For these reasons, over the past day or two I have again become much more concerned about the launching of a “Wag-the dog” scenario. Desperate times might lead to a truly “desperate” search for remedies.
Your long-predicted Iran invasion is the shakiest “imminent threat” since Iraq’s WMD program. Three years and counting, not a single missile launched, oil down 25 bucks in three months. The Zionist elders must be going bankrupt.
When I read about the political turmoil in Israel and the USA in relation to Iran, I get goose bumps.
Rather than a lame duck, the President rules like a wild duck without any accountability. Yet, if there is anyone in the know about the intentions of the Bush Administration, they are oil men. If oil traders thought that the attack on Iran was imminent, the price of oil would be skyrocketing.
oil down 25 bucks in three months. The Zionist elders must be going bankrupt.
Viewing oil prices along the struggle in ME and war with Iraq, its looks as the oil Prices goes down all of us feel relived and enjoying this negative surge in price of petrol, this indication tells there is a conflict/war near by.
I expected the price of oil will be down more to such level then Iran’s hit will be imminent, after that you will shock with the jump in oil price again.
Before Iraq war oil reach $US15.o/B (if I am right) after the invasion we saw the claming oil prices to more that $US60.0/B….
Actually salah, oil prices rallied throughout the buildup to the Iraq war, roughly doubling between 2002 and early 2003! They sold off shortly thereafter and didn’t recover til mid 2004. see:
http://futures.tradingcharts.com/chart/CO/M
A war w/Iran on the other hand, would not only put its 4 MM bpd at risk; it would disrupt all oil traffic through the strait of hormuz — thats 40% of the world supply. And no informed market participant (including all the worlds oil ministries, all its oil multinationals, etc) thinks there’s the slightest chance its going to happen, or such fear would be reflected in forward prices and risk premium, as it certainly was prior to both Iraq wars. Maybe Helena knows something these well-informed people have missed, since she’s been hyperventilating about an “imminent” invasion for several years now, issuing one unfulfilled prediction after another of air strikes, invasions, even nuclear attacks that were never to be.
I hope she recovers soon from her terror of (the admittedly creepy) Michael Ledeen.
Vadim, your accusation that I’ve been hyperventilating about an “imminent” invasion for several years now, issuing one unfulfilled prediction after another of air strikes, invasions, even nuclear attacks that were never to be.
Not true. Throughout last summer and fall, when many others were worried about an imminent US attack on Iran, I continued to make the case, here and elsewhere, as to why I didn’t think it would happen. (And similarly prior to that, too.) It is only in the past few weeks that I have either entertained or expressed any kind of a fear that an attack on Iran– by the US or by Israel– might be imminent; and I’ve only expressed this fear, I think, twice.
So enough of your silly and borderline-sexist “hype” about me “hyperventilating.” Also, if you want to speak to me or any other participant in these discussions here, it is only courteous to do so in the second person.
So sorry Helena. I had no idea that ‘hyperventilating’ was a sexist expression [I must say your definition of ‘sexist’ gets broader each day. Soon you’ll be calling me an anti-semite!]
Let’s see…there was this, way back on 7/26/05:
[citing Philip Giraldi…]”The plan includes a large-scale air assault on Iran employing both conventional and tactical nuclear weapons. ” I paused because I almost couldn’t believe my eyes, and I didn’t want to be part of a slanderous scare campaign….after I checked out Giraldi a little bit, I have to say that this looks like an entirely serious report.
On 4/8/06 you “terrifyingly” quote one of Sy Hersh’s trademark unnamed sources at length , claiming “that [the Bush administration] might seek to “cover” a chaotic military collapse in Iraq, politically, by launching an opportunistic military attack against Iran…” ‘Enough!…Stop the war talk! Stop the preparations for war! This is pure madness!’ Your exclams, your terror.
On 11/20/06 you ask (innocently!) “Anyone want to bomb Iran?” , citing Hersh (again) and an overwrought Josh Muravchik. Your conclusion:”I imagine that some people in positions more powerful than Josh Muravchik’s may well be tempted to explore this option” Perhaps by “may well be” you really mean “won’t?” Or is “may well be” another self-exculpating way to qualify hysterical guesswork? eg “You may well beat your wife, who’s to say? I imagine you may well be tempted!”
In Zelikow: What does he know? the posing of innocent questions reaches a new pitch:
“So maybe all the present visits by Bush and his high-level acolytes to Sunni countries are related not so much to planning regarding Iraq, but to some final advance planning for a military strike against Iran that may be fairly imminent?” Again that distancing question mark? Maybe? Maybe not? “But many pieces of evidence do, suddenly, seem to be coming together in this very worrying direction.” No question mark. That looks like a period.
So that was about two months ago. Then again this week, with the dog-wagger claim, twice. With all the fancy counterfactual footwork, its hard for a simple declarative-tense-minded clod like myself to take anything away from all this worrying over maybe-imminent attacks spanning well over a year. Perhaps you could solve the mystery by going on the record and letting us know, once and for all, whether an attack on Iran by the Bush administration is in your opinion likely. As an expert on Middle Eastern Affairs and US policy, and considering all factors, do you believe such an attack will occur at any time in the next six months?
Thanks so much in advance! And a belated happy new year!
Vadim, I looked at your chart. What I see is an overall steep upward trend in oil prices from 1999 to early 2006, with a recent slight decline.
It is just positively uncanny how closely that chart mirrors the stock performance of ExxonMobil during the same period:
http://ir.exxonmobil.com/phoenix.zhtml?c=115024&p=irol-stockchart
The only lesson I can draw from this is that George W. Bush has been very, very good for the oil industry (of which I understand you are a member).
Sorry, with the link above, you have to change the “time frame” to 10 years.
John,
The current price of oil is just over $50/bbl, which translates, as Vadim pointed out, into a $25/bbl decrease during the precise period that we’ve been treated to all sorts of – dare I say it? hysterical – claims of an imminent attack on Iran.
You might want to explain to us what is so strange about an oil company’s stock price being positively related to the demand for oil.
Case not made yet, Vadim. It was only in late November ’06 that I started to think a US attack, or US sanction for an Israeli attack, might be actually in the works. I still think the actual probability of an attack in the next year is 20%. Prior to November, I noted several reports about plans for an attack, and expressed concern about those plans and the reports on them, which have their own tension-raising effect. (It’s true, at one level, of course, that militaries have all kinds of plans– for contingencies that are remote or not remote.)
Anyway, I’m glad you’ve had a busy evening Googling through my archives and cherry-picking out a little totally non-conclusive evidence.
And now, back to the topic of the main post here… What news from Israel in Thursday,s papers, I wonder?
Some may be amused by the “hysterical Hellie” jibes but Ms. Cobban is not alone in being concerned about an attack on Iran in the near future. In addition to Seymour Hersh last year, in the past few weeks Col. Pat Lang, Gideon Rachman of the FT, Anatole Kaletsky of the Times and GaveKal Research,
http://www.timesonline.co.uk/article/0,,6-2530313.html
and Dan Plesch
http://www.guardian.co.uk/commentisfree/story/0,,1990463,00.html
among others have written that the possibility of military action against Iran by the US or Israel is a grave and gathering danger (sorry).
Earlier this month ING Bank issued a 24 page research note entitled:“Attacking Iran: The market impact of a surprise Israeli strike on its nuclear facilities”
http://www.rawprint.com/images/Iran07a.pdf and an update on Jan.15
http://www.rawprint.com/images/Iran07b.pdf. It makes for uncomfortable reading.
Presumably the complacent smirkers that believe futures markets are omniscient are short oil and gold. If so, they may be about to learn an expensive lesson.
Assisi thanks for the ING report. I’m sorry you mistook my smirking for complacence. You may agree that “20% odds within a year” is a far cry from “imminent” and I’m personally glad to see I’ve misread Helena’s earlier posts. Of course futures markets aren’t omniscient, but they are a good indicator of global sentiment, even if outlier scenarios are always worth consideration. Personally I have no directional exposure to crude oil, more to crude and product volatility where I am structurally long.
John C. you may find this old economist piece interesting for some perspective on Exxon. Enjoy.
http://www.mre.gov.br/portugues/noticiario/internacional/selecao_detalhe.asp?ID_RESENHA=252877&Imprime=on
“you may find this old economist piece interesting”
Thanks Vadim, I did find it mildly interesting, though I’m not sure why you brought it to my attention. Most of it is the standard “free trade” argument that big corporate conglomerates are much more efficient and incorruptible than the little, backward governments found out in the colonies, so the natives should just turn their resources over to the experts from Home Office. Is that what you wanted me to know? Or did you want to share your concern for the poor Venezuelans suffering under that mean Mr. Chavez (whom they have repeatedly elected by wide margins)?
Exxon’s lack of proven reserves establishes motive. The Cheney government attempted to supply the means, but looks like it won’t be able to finish the job. Something else is needed, wouldn’t you say?
Clearly, when the whole ME “revitalization” mission comes to a fiery end, it will be time for Latin America’s new left-leaning governments to worry. Actually, it will be too late. They should be planning now for when the bullseye shifts.
Some choice quotes from the article:
“The idea, says Luis Giusti, who ran PDVSA from 1994 to 1999, was to make use of multinationals’ technology and capital without surrendering the most lucrative opportunities to them.”
Nice idea. Didn’t turn out well.
“New oil is most likely to be found in the NOCs’ territory, precisely because it is largely out of bounds to multinationals such as Exxon and BP, and so has not yet been thoroughly raked over.”
Clearly, a thorough raking over is in order.
“Abundant, inalienable oil, on the other hand, seems to do most state-run firms more harm than good.”
So taking all that oil off their hands would really be doing them a favor, right?
“You might want to explain to us what is so strange about an oil company’s stock price being positively related to the demand for oil.”
Just when I was starting to doubt the connection between the Israel lobby and Big Oil.
Thanks for clearing that up, JES.
“This Op-Ed Was published today in The Washington Post]”
“I am concerned that public discussion of my book “Palestine Peace Not Apartheid” has been diverted from the book’s basic proposals: that peace talks be resumed after six years of delay and that the tragic persecution of Palestinians be ended.
Although most critics have not seriously disputed or even mentioned the facts and suggestions about these two issues, an apparently concerted campaign has been focused on the book’s title, combined with allegations that I am anti-Israel. This is not good for any of us who are committed to Israel’s status as a peaceful nation living in harmony with its neighbors.”
http://blackstarnews.com/?c=135&a=2888
Again John, rather than being flip, you might want to explain to us what is so strange about an oil company’s stock price being positively related to the demand for oil.
JES,
oil company’s stock price being positively related to the demand for oil.
JES, The Saudi Minster did an interview last year before the oil prices reached $US62/B stated that each day there were a 500Milion B/Day touring the sea there is no demand/Buyer for it! imagine 500Milion B/D?
If there is a demand as those Big Oil cartel give us their story why oil prices up, then why this 500Million B/D (just from Saudi oil production) left each day no buyer asking for it?
Where is the truth? The demand or the Greedy Big Oil Cartels?
JES,
oil company’s stock price being positively related to the demand for oil.
JES, The Saudi Minster did an interview last year before the oil prices reached $US62/B stated that each day there were a 500Milion B/Day touring the sea there is no demand/Buyer for it! imagine 500Milion B/D?
If there is a demand as those Big Oil cartel give us their story why oil prices up, then why this 500Million B/D (just from Saudi oil production) left each day no buyer asking for it?
Where is the truth? The demand or the Greedy Big Oil Cartels?
Salah,
Perhaps Vadim can weigh in here as a professional, but it seems to me that what the Saudi minister probably meant was that oil prices had reached a point where consumers could not afford to buy, and so demand dropped off (when that becomes accute, it’s called a recession). The biggest, and greediest, oil cartel of them all has tended to carefully boost production to increase supply and avoid depressing demand. That cartel is OPEC.
My question to John had to do with the fact that the 10-year chart that he referred to indicated, more than anything else in my opinion, a trend of increase in demand – particularly by China over that period. It is not surprising that investors would see more value in companies like Exxon with that kind of trend – irrespective of what the US might or might no have planned in the short term for Iran.
Of course, I’m sure that you and John picture oil executives in top hats with striped pants, twirling their mustaches and going “Ah-hah!”
Hey Vadim, if you’ve got a few minutes, drop me a line, will you? I’ve got a development economics question that I’d appreciate your thoughts on.
John, your interpretation of that Economist piece was in my view a bit off. Especially that big corporate conglomerates are much more efficient and incorruptible than the little, backward governments found out in the colonies, so the natives should just turn their resources over to the experts from Home Office. Mostly the piece contrasted well-run NOC’s (Brazil, Malaysia, Norway, Saudi) with those like PDVSA and Rosneft, citing among other factors the willingness to both partner with and compete with the multinationals. It doesn’t imply that privatization is the answer to anything, rather operational autonomy, transparency and responsibility. Statoil’s governors would never fire 16,000 striking engineers, which is why Norway’s reserves are intact while Venezeula’s have been gutted.
I only cited it to give you a sense of how unimportant seems Exxon relative to state-owned Goliaths like Statoil, Aramco and PDVSA. To your suggestion that GWB is in league with Exxon, I’d only note that most GOP corporate donors are short (ie buyers of) crude oil –refiners, manufacturers, homebuilders, farmers, etc.– and that even among oily GOP bigwigs, many are outspoken isolationists.
“Again John, rather than being flip, you might want to explain to us what is so strange about an oil company’s stock price being positively related to the demand for oil.”
JES, don’t be silly. Of course there is nothing strange about it. However, if you lived in the US, you would know that Exxon’s PR department doesn’t like to emphasize how enormously they have profited from the rise in oil prices (and consumer gas prices) over the last 6 years. They would prefer for the American people to think they are just passing on the higher prices they are forced to pay to those nasty NOCs that Vadim’s friends were complaining about. You should let Vadim explain to you how to make this argument more effectively. Naturally, when addressing their shareholders or the business press, the top oil executives attribute all of these windfall profits to their own brilliance, which leads us to your next topic:
“Of course, I’m sure that you and John picture oil executives in top hats with striped pants, twirling their mustaches and going ‘Ah-hah!’”
I wish. In reality, these guys make the robber barons of the Gilded Age look like pikers. See for example:
http://abcnews.go.com/GMA/story?id=1841989
You should let Vadim explain to you how to make this argument more effectively.
Gee John, thanks for pointing that out to me.
You should probably take a look at what the large oil companies tell their investors and potential investors, not to mention the SEC. They seem to be pretty open about where their profits are coming from. That stuff is all readily accessible to me, so I imagine that you too could have a look, and I think it makes a lot more sense than does your implied argument that they are somehow trying to hide their profits from the public.
And, yes, I have seen Exxon’s and other oil company’s PR efforts, however just not with the jaundiced eye that you apparently view them with. When explaining profits, I believe that the oil executives tend to point out the fact that they, in fact, are the ones who have invested and taken the risks in costly exploration and drilling that many of the nationalized oil companies are either unwilling or unable to assume. I think that the two sides of the Caspian are a good case in point, not to mention the deteriorating state of Iranian oil production. You might also want to take a look at what decades of Soviet nationalized petrolium production did, not only in terms of poor production and waste, but also in its devastating effects on the environment in the Soviet Union.
And John,
I think that the issue in the article you cited is not that Raymond’s retirement package came at the expense of consumers, but rather that it came at the expense of the shareholders.
JES
expense of consumers, but rather that it came at the expense of the shareholders.
JES, both same, the money cam out of the consumer pockets, isn’t it?
Is Energo-fascism in Your Future?
The Global Energy Race and Its Consequences (Part 1)
By Michael T. Klare
http://www.tomdispatch.com/index.mhtml
Stratfor, for its part, does not foresee a military strike against Iran by the US or Israel this year – 2007 Annual Forecast (Jan. 17).
In the same forecast Stratfor does predict, however, that Israel will return to its war against Hezbollah sometime this summer. This passage stands out:
“Israel could move indirectly to destabilize Hezbollah in Lebanon ahead of a military confrontation… By provoking sectarian violence in Lebanon, Israel could pit Hezbollah fighters against fellow Lebanese, which would wear down Hezbollah’s military forces and tarnish its reputation as a nationalist movement, making the organization more vulnerable to an Israeli onslaught. The Israeli Mossad could also be engaged in attempts this year to eliminate elements of Hezbollah’s core leadership to further destabilize the party.”
The happy prognosis for the Israel/Palestine conflict in 2007 is:
”The Israeli government will work to ensure that Hamas and Fatah are prevented from coming together in an agreement; while Israel is sorting out its own issues at home, it will much prefer to have the Palestinians fighting each other than focusing their attention on attacking Israel. The impasse in the territories will prevent the Israelis and the Palestinians from engaging in any serious final-status negotiations this year.”