Could the fall in oil prices be due to geopolitics?

January 29th, 2007

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In our previous article, What if the Israelis strike Iran?, we mentioned that it was ?interesting to note the Saudis? nonchalance about the recent falls in oil prices.? Today, we saw this article, How the Saudis plan to put oil squeeze on Iran, from the mainstream news media.

Given that any military strikes against Iran will result in extremely serious consequences, using the suppression of oil prices as an economic tool to deal with Iran is the most sensible option. Iranian President Mahmoud Ahmadinejad is in a very vulnerable position?his regime lacks economic credibility and hence, it is very much possible for him to be ousted from power because of it. Falling oil revenues, which are detrimental to Iran?s economy, will probably make this possibility even more likely.

We certainly hope this best-case scenario will ensue. Since President Mahmoud Ahmadinejad (an extremist within his Shia Islam religion) has the destruction of Israel as part of his ?theology,? we see that he is beyond rationality and reason. Thus, as long as he remains in power, Israel will be in a lose-lose situation?when faced with an irrational enemy who is on the way to acquire destructive weapons against you, your remaining options are pretty much limited!

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