Bahman Aghai Diba PhD International Law - Persian Journal

The officials of the Islamic Republic of Iran have threatened that if the United Nations Organization adopts serious sanctions against the regime of Iran (due to the nuclear case of Iran which is currently in the Security Council of the UNO), they may resort to the “oil weapon”. This threat has been also used in the past for countering the Western efforts for stopping the Iranian nuclear program of Iran and the struggle to get the regime in Iran changed from the Islamic Republic to something else. (1) But, what is the oil weapon and what does it mean for the regime of Iran and the others?

It seems that the “oil weapon” is anything that could be used to stop or hinder the flow of the much-needed oil to the international markets. This could include a wide range of actions that intentionally stop or seriously reduce the flow of oil from the oil exporting countries to the main consumption centers.

The expression of “oil weapon” has been used in the past by various sources to refer to different notions. Some people have indicated to the possible use of the “Iran oil Bourse” which may use Euro for oil transactions, as one of the sources of the “oil weapon”. (2) It has also been widely used in the media to refer to the case of the “oil embargo” in the 1973 style (that Arab oil producing countries tried to use the oil leverage against the West due to supporting the Israel in the war with its Arab neighbors). Also, The terrorists that wish to make troubles for the internal and external enemies of the concerned persons or organizations have also used it as a means for their aims. (3) However, what the Iranian authorities have been referring to is not a general oil embargo or a group action, or a terrorist act.

Although some Iranian officials have invited the Muslim oil exporting countries in the past to consider a group action in the field of oil supplies in order to exert pressure on the Western states (to reduce or stop supporting the Zionists or Israel), it is almost certain that in the present case of Iran’s quarrel with the Western states (especially the USA), no other country is going to join Iranian regime in the usage of “oil weapon” and turn this move into a general action. Terrorist actions may be included in the plans of Iran to use oil weapon but they will be only a part of the last resorts and the “Iranian Kamikaze”.

Michael T. Klare writes: “…when talking about oil’s importance in the American strategic thinking about Iran, it is important to go beyond the obvious question of Iran’s potential role in satisfying our country’s future energy requirements. Because Iran occupies a strategic location on the north side of the Persian Gulf, it is in a position to threaten oil fields in Saudi Arabia, Kuwait, Iraq, and the United Arab Emirates, which together possess more than half of the world’s known oil reserves…”. (4)

Any action by Iran to stop the oil flow from the Persian Gulf countries, by blocking the strait Hurmoz, attacking the shipping lines, trying to blow up the pipelines or the production and refinery facilities of the other countries in the region (such as Azerbaijan, Kazakhstan, and Turkmenistan in the Caspian Sea, or Saudi Arabia, Kuwait, Iraq, Qatar, the United Arab Emirates, Oman, Bahrain in the Persian Gulf), will be considered as a serious violation of the international laws and regulations for the concerned states. It would be in practice like giving a declaration of war to them. At the same time, it would be a serious challenge to the interests of the major oil importing states, especially the USA, that according to the Carter Doctrine considers the Persian Gulf as an area of vital interests. The US government feels obliged to stop any serious challenge to its vital interest, by all means, including the military actions.

In fact, once in the past the struggle of the Iranian regime during the Iran-Iraq war (1980-88) lead to a serious confrontation of Iran with the US forces in the region. According to the Wilipedia “on 18 April 1988, the US Navy waged a one day battle against Iranian forces in and around the [Hormuz] strait. The battle, dubbed Operation Praying Mantis by the US side, was launched in retaliation for the 14 April mining of the USS Samuel B. Roberts (FFG-58). US forces sank two Iranian warships and as many as six armed speedboats in the engagement, which was the largest between surface forces since the World War II.”(5)

Can Iran block the Hormuz Strait?

The Strait of Hormuz is the narrow sea passage that connects the Persian Gulf to the Oman Sea. This is the only sea-passage for the export of oil from the Persian Gulf states. The Iranian forces have done several maneuvers aimed at closing the Strait of Hormuz at the time of crisis and the Western forces in the region (in cooperation with the some of the littoral countries or independently) have conducted several maneuvers aimed at deterring such plans. Peter Brooks, a senior fellow at the Heritage Foundation, writes: “Iran could temporarily wreak havoc in the Persian Gulf, using sea-skimming, nears supersonic Chinese C-801 anti-ship cruise missiles (and older Silkworm missiles), quiet Russian Kilo diesel and mini-submarines, stealthy mines, high speed patrol boats ’swarm’ tactics…”. (6)

Also, Kenneth R. Timmerman writes: “…Iran plans to begin offensive operations by launching successive waves of explosives-packed boats against U.S. warships in the Gulf, piloted by “Ashura” or suicide bombers. The first wave can draw on more than 1,000 small fast-attack boats operated by the Revolutionary Guards navy, equipped with rocket launchers, heavy machine-guns and possibly Sagger anti-tank missiles�A second wave of suicide attacks would be carried out by “suicide submarines” and semi-submersible boats, before Iran deploys its Russian-built Kilo-class submarines and Chinese-built Huodong missile boats to attack U.S. warships, the source said. The 114-foot Chinese boats are equipped with advanced radar-guided C-802s, a sea-skimming cruise missile with a 60-mile range against which many U.S. naval analysts believe there is no effective defense…The Iranians also plan to lay huge minefields across the Persian Gulf inside the Strait of Hormuz, effectively trapping ships that manage to cross the Strait before they can enter the Gulf, where they can be destroyed by coastal artillery and land-based “Silkworm” missile batteries. Today, Iran has sophisticated EM-53 bottom-tethered mines, which it purchased from China in the 1990s. The EM-53 presents a serious threat to major U.S. surface vessels, since its rocket-propelled charge is capable of hitting the hull of its target at speeds in excess of 70 miles per hour. Some analysts believe it can knock out a U.S. aircraft carrier…” (7) More recently, the semi-official Iranian news agency has reported: “…Iran successfully test-fired a super-modern flying boat on Tuesday during war games at the Strait of Hormuz, the Mehr News Agency correspondent in the region reported. The boat is capable of moving at high speeds of up to 100 knots in the Persian Gulf waters and the Oman Sea. Because of its advanced design, no radar at sea or in the air can locate it. It can lift out of the water and can launch missiles with precise targeting while moving….A new land-to-sea missile called Kowsar was also tested successfully on Tuesday…”(8)

Therefore, it seems that Iran has actually enough power to block the Strait of Hormuz by sinking several big ships in the main channels of the traffic (although most of the traffic separation lines are in the side of the Strait which are technically, i.e. according to the international law of Seas, part of Oman’s Territorial waters. Also, Iran may interrupt the shipping in the Strait of Hormuz by mining the international waterway or directly attacking the target vessels. Such actions are enough to stat a full-scale war between the regime of Iran and all other concerned force.

However, at the present time, what Iranian regime is referring to as the oil weapon is only “stopping the flow of Iranian oil to the market”. Iran produces about 4 million barrels a day and exports 2.4 million barrels a day. The oil market is volatile at moment due to several reasons (9). Cutting the oil input of Iran from the international markets would certainly lead to a serious increase of the prices. It may reach the level of 100-120 dollars per barrel.

This is going to be two-sided weapon. The oil prices over a hundred dollar will have serious consequences for the international economy. However, Iran as an oil exporting country will be in a difficult situation if the export of oil is stopped. “Iran’s government derives about 50% of its revenues and most of its foreign currency from oil sales…” (10) Iran is not only relying on the oil revenues for its economy, but also it is an importer of the oil products. Iran has not the capacity to produce enough gasoline for the internal consumption and it has to import a major part of its needs from other countries. (In recent years, Oman has been a major source of gasoline imports for Iran). According to Peter Kiernan: “…although Iran is the second largest producer in OPEC, its domestic refining capacity does not meet local demand, and it must import about 170,000 bpd of gasoline, which costs it as much as $4 billion a year…” (11) Also, Ilan Berman writes “a closer look indicates that the oil weapon, whether in the form of reductions in Iranian output or military moves in the Hormuz Strait, is likely to be a double-edged sword for the Islamic Republic…in their planning, the Bush Administration and its international partners would do well to take doomsday predictions about Iranian energy leverage with a grain of salt. But they should also be thinking carefully about the economic and political costs of inaction. Simply put, Washington must ask itself whether the world would be better off with a temporary spike in energy prices created by a serious Iran strategy, or with a permanent hike in the cost of doing business in a region dominated by an atomic Islamic Republic.” (12)

Eventually the countries that have problems with the regime of Iran (for its policies in the Middle East peace process, supporting terrorism, trying to expand Islamic revolution, and of course the nuclear program of Iran) have to decide that a 100 dollar (per barrel) oil is more dangerous or survival of a regime like the one that is in power in Iran and it may get its hand on the nuclear weapons.

Condoleezza Rice, the US Secretary of State, has played down the threat of Iran for using the oil weapon. For instance, following the threats from the Ayatollah Ali Khamenei, the Supreme Leader of Iran, she said: “We should not place too much emphasis on a threat of this kind.”(13)

It seems that the concerned countries in the region are not going to tare the threats of Iran so lightly. Some of the actions that are gradually taking place in response to such threats are:

1- Trying to reduce the reliance to the Persian Gulf oil, through finding alternative sources, such as the Caspian Sea region.

2- Reducing reliance of the oil exporting countries of the Persian Gulf on the Persian Gulf (especially the Strait of Hormuz) and persuading the exports from the Red Sea (although it makes the supply far from some of the most important centers of demand such as China and India).

3- Trying to restore the Iraqi oil supplies as a replacement for the possible cutting of the Iranian oil.

4- Using the floating super tankers that keep the oil in the regions out of the Persian Gulf and ready to be traded.

5- Expanding the oil storage facilities in the major consumption centers. There is also news of storage facilities of the Saudi Arabia in China. Paul Rogers has written in the Energy Bulletin “…A refinery for Saudi oil is already being built in Fujian, and a joint refinery venture is planned for Qingdao. Perhaps more significant is the plan to build a strategic oil-reserve facility in a coastal location in southeast China, the aim being to supply and store Saudi oil in which can be used in times of conflict and disruption of supplies.” (14)

6- Expansion of the pipelines in the region. These pipelines take the oil and gas from the Persian Gulf region to the places like the Mediterranean and Red Sea.

Notes:

(1) Ayatollah Ali Khamenei, Iran’s Supreme Leader, has given a warning that Iran would disrupt the oil shipments in the Persian Gulf if the USA “makes a wrong move” in the confrontation with Iran over the nuclear program of Iran. (http://www.telegraph.co.uk/core/Content/display
Printable.jhtml:jsessionid+NMHIWRKS dated 06/25/2006). Also, on 24th of June (2006), the Iranian oil Minister, Kazem Vaziri-Hamaneh, claimed that Iran may use the oil weapon, if this would serve the national interests. (http://asianews.it/viewp.php?1=6550, dated 27 June 2006). Also, Iranian government spokesperson, Gholam-Hossein Elham has said: “Iran would disrupt oil supplies as the last resort if it were punished over its nuclear program”. (http://www.zaman.com/include/yazdir.php?bl=hotnews&alt
=&trh=20060626&hn=34302 dated 06/26/2006).

(2)(In this field please refer to “Iran Oil Bourse and Petrodollar Wars”, Http://www.iranian.ws/iran_news/publish/
article_13228.shtml dated 14th of Feb 2006).

(3) As such, the evidence in Iraq indicates that disruption in the flow of oil is one of the main objects of the terrorist organizations in that country. Also, the Al-queda and its main operatives have many times asked for and tried to use the disruption in the oil flow through terrorist actions. The aims of terrorists in this field are: 1- they create problems for the destination countries, especially the West, 2- Cut or slow down the income of the exporting countries, and 3- put pressure on the people of the target countries through reduction of the availability of the oil and its products.

(4) http://www.tomdispatch.com/inexprint.mhtml?pid=2312

(5) http://en.wikipedia.org/wiki/Strait of Hormuz

(6) http://www.heritage.org/Press/Commentary/
ed06080c.cfm?Renderforprint=1 dated June 8, 2006

(7) http://www.newsmax.com/script/printerfriendly.pl
?s=pf&page=http://www.newsmax.co dated March 1, 2006

(8) http://www.mehrnews.ir/en/Newsprint.aspx
?NewsID=307756 dated April 4, 2006

(9) Regarding the reasons for the increase in the oil prices please refer to: “Oil Prices: Fundamental and Temporary Reasons” http://www.iranian.ws/irannews/publish/
printer11272.shtml dated Dec.4, 2005)

(10) http://www.itp.net/business/features/print
.php?id=4530&prodid=&category=arabianbusiness dated 11th of June 2006

(11) The oil weapon and Iran, http://www.atimes.com/atimes/printN.html

(12) http://article.nationalreview.com/print/
?q=MDY5YjFjNDdiNmRjODilMmY5ZTc1NzZiZ dated June 7, 2006

(13) http://www.telegraph.co.uk/core/Content/
displayprintable.jhtml;jsessionid=NMHTWRKS. Dated 06/25/2006

(14) http://www.energybulletin.net/print.php
?id=17254 dated June 16,2006

© Iranian.ws Jul 11, 2006

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