Amidst the activity of the lame-duck Bush presidency, the incoming Obama administration, the global economic, banking, and credit crisis, the war in Iraq, and an escalating effort in Afghanistan, there exists an opportunity. It exists immediately, and in some ways we should not wait until the Obama presidency commences on January 20, 2009 to address it. The opportunity is ripe to reform the global relationships with Iran and the Middle East Bloc of countries.
Due to falling oil prices that stem from a decreased demand by western countries and the global economic downturn, Iran and a host of other Middle East countries are heading towards the ruin of their primary source of income: oil revenue.
The adage, “timing is everything” holds true. OPEC’s efforts to date in cutting production have not stopped the price of oil from plummeting further. It is now under $50 per barrel. Prices at the pump in the eastern part of the U.S. are below $2.00 per gallon. The Middle East Bloc is not happy and, frankly, are even a bit shaken. The Middle East Bloc has not been exploring alternative means of revenue. Oil revenue exists and will continue to exist for the near future to be their primary source of economic survival. While prices hover around $50 per barrel, it is likely that, due to the economic recession, consumption will stay down, and even with OPEC’s continued cuts in production, we are not going to see a $100.00 barrel of oil in the next 12 months. OPEC’s production cut can only go down so far before they have little product to produce, meaning little revenue at any price. Now is the time to commence discussions while the economics of oil are for once a bit in the favor of the West.
So what can the West do?
Western countries can sit back and do nothing as the lower prices at the pump help us recover economically as the prices of food and goods is reduced due to lower transportation costs. The West can embrace the thought that the Middle East Bloc was previously gouging the West with the price on oil, and now has gotten their due. Unfortunately, we would fid ourselves making no progress on the oil dependency and energy independence front, and 24 months from now, when the oil pendulum swings the price back up to $4.00 per gallon at the pump, we will be right back to where we were two months ago.
A smarter option is for the West to form some realizations about what has happened and why it has happened that way in the past few months. The West has a weapon right under its nose, and it is not a military one. That weapon is reduced consumption. While pulling back on consumption too much would lead to a continued recession as transportation creates economic activity in this country, a continued effort to conserve with smart travel would keep use levels down considerably. Smart travel would have to proliferate with individuals, families, and industry. Interesting enough, the reduced consumption was not a governmental or other form of outright declaration. It just happened. It happened because more people had the common sense to consciously reduce their travel due to economic pressures. The West already knows how to do this as evidenced in the past three months.
Alternative energy, nuclear power, and the like were hot topics during the last 18 months as oil prices soured and their effects were felt throughout the U.S. economic system. Worries about Iran’s continued effort to develop a nuclear weapon were also hot on the press list. With prices on a decline, the alternative energy discussion has started to recede. Some members of Congress have stated that pushing through a large funding package for alternative energy is a harder sell when pump prices are down and the immediate fiscal pain has subsided. It is a mistake to place nuclear and alternative energy on the back burner right now, regardless of pump prices.
Reduced consumption levels can address two things: provide the West with leverage with Iran and other Middle East Bloc countries to address an entire host of problems; and extend the amount of time we have to develop alternative energy resources and bring them to fruition. Reduced consumption is not the answer, it is a tool to be used along the way of resolving energy dependency from the Middle East while we develop our own independentally.
While Iran and the rest of the Middle East Bloc is in a declining position, it is an excellent time to engage them in multiple areas that are problematic for the West.
Why start with Iran?
Essentially, Iran is the superpower in the Middle East. They have far reaching ties within Syria, Iraq, and Lebanon, as well as funding links and a reported history of support with groups who do not have positive relationship or view with the West, like Hezbollah. They are in a position to harm the west’s interests and, by some accounts, have already done so. Iran is OPEC’s second largest oil producer, behind only Saudi Arabia. Almost no country, including their close trading partner Russia, really wants Iran to possess a nuclear weapon. All efforts so far by the National Security Council, the U.N., and a host of inspection agencies have apparently not slowed them down. A weapon is expected to be realized within three to five years by some accounts.
What would be the measured results to seek with Iran?
Because of their superpower status, Iran can help the West with a host of related problems. Iraq, for one, and, just to name a few more, terrorism, Al-Qaeda, Israel and Palestine peace. A guarantee of reduced oil prices over a graduated period of time in exchange for some guaranteed oil purchase levels may also be one of them. By member countries of OPEC’s accounts, a $75 per barrel level represents a livable situation. This could occur while we continue to keep consumption at current levels or lower, and, again, while the West develops alternative energy plans and methods.
The policies of the last 30 years with Iran have not worked. Silence resolves little, and does nothing to advance new issues and needs. Some communication with your enemies, even in disagreement, provides an opportunity to learn something, and possibly resolve issues that to date, have not been resolvable. Both parties are in a time of need. It is now the time to talk.Pages: