Petrodollar pumping US policy on Iran, backfire looms

An oil field near Pol-e-Dokhtar, Iran

As tensions between the US and Iran heat up, author Michael T. Winter believes the main reason behind America’s harsh stance is Tehran’s move to seek an alternative to the dollar as an oil currency.

­Economic sanctions, spearheaded by the US and, less willingly, the EU could have a disastrous effect on both of their respective economies. If Iran cannot sell their oil to Europe, there are plenty of customers waiting in the wings, and if they come bearing not petrodollars, but gold and sovereign currencies, then all the better for Iran. These sanctions, if enforced, will in effect place a serious dent in the power of the petrodollar.

Any rhetoric regarding Iran’s nuclear program and the insistence on crippling it is nothing more than a US attempt to force regime change for one more receptive to maintaining the hegemony of the petrodollar.

The world now knows the truth about the US and how they conduct their affairs. US hostilities toward Iran have nothing to do with nuclear weapons development. If that were the case, then North Korea and Pakistan would be facing similar sanctions and threats, but they aren’t. The difference of course is in what lies beneath the ground – oil. Iran has it and the other guys don’t.

At the heart of the issue is not Iran’s dubious attempt to build nuclear weapons, or even oil, but how that oil is paid for. In 1973, Richard Nixon promised King Faisal of Saudi Arabia that the US would protect Saudi Arabian oilfields from any and all interested parties seeking to forcefully wrest them from the House of Saud. It’s important to remember that in 1973, Saudi Arabia didn’t have a fraction of the military and ground forces it possesses today (almost exclusively US manufactured weapons) and the USSR was very much a threat.

In return Saudi Arabia, and by extension OPEC, agreed to sell their oil in US dollars only. As if that weren’t sweet enough, as part of the deal, they were required to invest their profits in US treasuries, bonds and bills. The real zinger is that all countries purchasing oil from OPEC had to do so in US dollars, or ‘petrodollars’.

This strengthened the US dollar, resulting in a steady US economic growth cycle throughout the 80’s and 90’s. Countries purchasing OPEC oil started buying US treasury bills, bonds and securities to ensure they could continue purchasing OPEC oil. This worked fine for the US until 2001.

No plan, however well formulated, functions smoothly indefinitely.

2001, enter Saddam Hussein. He floated a plan to sell oil for European currencies in lieu of petrodollars. Shortly after Iraq was ‘suddenly’ found to be seeking and stockpiling weapons of mass destruction – allegations spearheaded by the US. The world knows what happened, suffice it to say that Saddam is dead and Iraq is ‘back on track’, selling its oil for petrodollars once again.

Muammar Gaddafi harbored the Lockerbie Bombers and allowed various terrorist organizations establish training camps in Libya. He tried to buy a nuke from China in 1972. In 1977, he approached Pakistan, then India. He sought nerve gas from Thailand. In spite of well over fifty failed assassination attempts on Gaddafi by Israel, the US and the UK, Libya was left to its own devices for the most part. Seeking nukes and harboring terrorists is one thing, but threatening the petrodollar is quite another. Gaddafi made a fatal error when he decided to move away from the petrodollar in favor of other currencies. This simply was not tolerated by the US. Having already played the WMD card in Iraq, something new was pulled from the US ‘regime change’ grab bag. Within a year, ‘internal’ elements rose up in rebellion against Gaddafi and now he is dead. Long live the petrodollar.

Dominique Strauss-Kahn, former head of the International Monetary Fund (IMF), suggested last year that the Euro would be a more suitable oil reserve currency than the US Dollar. Within three months of that statement, allegations of rape ruined his career, derailing his bid for the French Presidency in the process. Soon thereafter, all charges were dropped, but of course, le dommage était fait – the damage was done. Christine Lagarde, DSK’s replacement as head of the IMF sees no reason to change the current arrangement, naturellement.

The Iran situation is a little trickier. The US has sought to dismantle Iran’s regime ever since the 1979 Iranian Revolution, so this round of hostilities, while not new, reflects a new level of intensity. Why, after thirty years of hostility, has the US ratcheted up its rhetoric? As Obama stated in his recent State of the Union address, when it comes to Iran and the insistence they dismantle their nuclear program, “no options are off the table”. By stating ‘no options’ this would include nuclear deployment as a deterrent.

The answer of course is that Iran is now seeking to disengage itself from the petrodollar dynamic. In 2005, Iran sought to create an Iranian Oil Exchange, thus bypassing the US controlled petrodollar. Fear that western powers would freeze accounts in European and London banks put an end to that plan.

But that was not the end of their attempts, and Iran sought other ways to get around the petrodollar noose. There are rumors that India, which imports 12% of their oil from Iran, has agreed to purchase oil for gold. Energy trade with China, importing 15% of its oil and natural gas from Iran may be settled in gold, yuan, and rial. South Korea plans to buy 10% of their oil from Iran in 2012, and unless Seoul sides with American and European sanctions, it is likely to use gold or their sovereign currency to pay for it. Also, Iran is already dumping the dollar in its trade with Russia in favor of rials and rubles.

Iran is breaking the back of the petrodollar. Others have tried, but Iran is succeeding. To understand how disastrous this is for the US, one must have a basic understanding of how critical a role the petrodollar plays in the economic health of the US.

Through King Faisal, Nixon elevated the US to supreme economic ascendency, not unlike Damocles in his desire to rule. Sitting on the (economic) throne of the world is great, but Nixon was either unaware of the sword dangling over the US economic system, or chose to ignore it in favor of reaping the rewards of the moment.

By creating the petrodollar paradigm, the US economy soared, as all countries of the world were required to amass US currency to purchase oil from OPEC nations. Sales of T-bills, securities and US bonds soared. US coffers fattened. With the US dollar as the world’s oil currency reserve, economic fortune favored the US. But with great reward comes great risk. While other countries exchanged their currency for the dollar, (forfeiting value in the process) the US simply printed more money to match their needs and purchase their oil – essentially for free. The best example is that while gasoline in the US cost $3.00 per gallon, in Europe that same gallon costs $6.00 or more.

Herein lies the danger. If Iran is successful in its bid to set up their own bourse, or oil exchange, then what need does the world have for all those US dollars? The answer is none at all. As Iran creating gold and sovereign currency partnerships with India, China, South Korea and Russia, the hegemony of the petrodollar will be destroyed.

The resulting sell-off of US dollars, T-bills, securities, bonds and assets will flood the already swollen world economy with even more useless dollars, ultimately devaluing it into a position where hyper-inflation becomes a risk.

So, while the US government sabre-rattles and prattles on and on about nuclear weapons and the threat Iran poses to the Middle East, the thin veneer of lies spouted by the elite controlled media is being stripped away, revealing the truth of their warmongering rhetoric.

The US, by their foolish insistence on enforcing embargoes and sanctions against Iran, is hastening the end of the petrodollar and ushering in the age of US dollar hyper-inflation. A practical example: One loaf of bread in a healthy economy is $1.00. In an inflationary economy it’s $1.75. In a hyper-inflationary economy, $500.00.

Bullies may be large and dangerous, but rarely are they intelligent.

Damocles wisely vacated the throne of Dionysius before the sword fell upon his head, but the US is foolishly refusing to step down from their economic dais in spite of the catastrophic effect current policy direction will mean for US citizens and the world economy.

­Michael T. Winter

US Intel Director Prepares Public for False Flag Event

Tony Cartalucci
Infowars.com
Wednesday, February 1, 2012

“…it would be far more preferable if the United States could cite an Iranian provocation as justification for the airstrikes before launching them. Clearly, the more outrageous, the more deadly, and the more unprovoked the Iranian action, the better off the United States would be.

Of course, it would be very difficult for the United States to goad Iran into such a provocation without the rest of the world recognizing this game, which would then undermine it. (One method that would have some possibility of success would be to ratchet up covert regime change efforts in the hope that Tehran would retaliate overtly, or even semi-overtly, which could then be portrayed as an unprovoked act of Iranian aggression.) ”

-US foreign policy makers in the Fortune 500 funded Brookings Institution’s “Which Path to Persia?” report, pages 84-85.

Considering that the Gulf of Token incident was a deliberate fabrication to escalate the Vietnam War, one many members in Congress are shown to have acknowledged and debated even at the time, or the more recent Iraqi WMD hoax, there is certainly a historical precedence to create such provocations when targeted nations refuse to provide them.

With this in mind, and noting an overt, ongoing series of bold acts of war carried out by the US and Israel inside of Iran, along with sanctions and planned blockades, also acts of war, the corporate-financier oligarchs have been confounded by what seems to be infinite Iranian patience to endure such provocations. US foreign policy makers have noted for years now that Iran in actuality poses no threat to US or Israeli national security and their acquiring of nuclear weapons serves more of a deterrence against future military incursions against the Islamic Republic by the West, than a means to launch unprovoked attacks against nations that each possess nuclear deterrents of apocalyptic scale.

While Iran endures an increasing torrent of unprovoked attacks, they steadily advance their defensive capabilities to ward off what seems like an inevitable invasion by the West, who has already invaded and occupied for years nations to its east and west on false pretenses, and have for the past year fueled foreign-funded revolutions across the Middle East and North Africa. Time is on the Iranians’ side, as Western attempts to destabilize and destroy Syria drag on, and an increasing number of people around the world begin to understand the true source of instability behind the so-called “Arab Spring.”

While behind closed doors US policy makers admit Iran is driven by self-preservation and protecting the influence it is steadily gaining throughout the Middle Eastern region it borders, the message they desperately seek to relate to the public is one of an irrational apocalyptic theocracy eager to usher in Armageddon.

However, reports out of the RAND corporation note that Iran has had chemical weapons in its inventory for decades, and other reports from RAND describe the strict control elite military units exercise over these weapons, making it unlikely they would end up in the hands of “terrorists.” The fact that Iran’s extensive chemical weapon stockpile has yet to be disseminated into the hands of non-state actors, along with the fact that these same elite units would in turn handle any Iranian nuclear weapons, lends further evidence to the conclusion that Iran is indeed driven by self-preservation.

Brookings notes on pages 24 and 25 of their “Which Path to Persia?” report, that the real threat is not the deployment of these weapons, but rather the deterrence they present, allowing Iran to counter US influence in the region without the fear of an American invasion.

Latest “Warning” of “Impending Iranian Terrorist Attack”

Despite this documented evidence, the Director of National Intelligence James R. Clapper Jr. made a startling statement recently, citing an already discredited alleged “Iranian plot” involving an assassination attempt of a Saudi ambassador on US soil, that Iran is “now more willing to conduct an attack in the United States in response to real or perceived U.S. actions that threaten the regime.” What Clapper describes is not in fact an impending Iranian attack, but a false flag event to be blamed on Iran to fit the criteria for a suitable justification for war, clearly defined by the Brookings Institution’s report.

What is more troubling is that the Washington Post, which reported Clapper’s comments, acknowledges that “a covert campaign is already underway to thwart Iran’s alleged ambition to develop a nuclear weapon.” And while the US has officially denied carrying out any act of violence inside of Iran, it is a matter of public record that the US State Department in conjunction with the UN is harboring a US State Dapartment listed “foreign terrorist organization,” the Mujahedeen e-Khalq (MEK) in Iraq, who has for decades carried out such violent attacks within Iran. In fact, the same Brookings Institution report cited above, also proposed the use of MEK as a suitable US proxy in provoking Iran. It would turn out that the alleged “Iranian-Saudi assassination plot” cited by Clapper, was more plausibly the work of MEK, than the Iranian Revolutionary Guard.

And as Al Qaeda is re-purposed for overthrowing America’s enemies in Libya and Syria, withLIFG terrorist leader Abdul Belhaj (aka Abdul Hasadi) literally leading NATO-armed legionaries into battle in now two nations, the “terrorists threat” has been shifted onto Iran – the sort of conveniently timed plot twist to be expected for a “War on Terror” that is a verifiable fraud.

The Bottom Line

Iran has nothing to gain and everything to lose by attacking the United States. US policy makers have expressed a documented desire to provoke the Iranians into a war the Islamic Republic is clearly trying to avoid. The United States government is on record funding, arming, and training terrorist organizations (LIFG & MEK) on it’s own “foreign terrorist organization” list,a violation of their own anti-terrorism laws. They have failed categorically to provide convincing evidence regarding the alleged “Iranian-Saudi assassination plot,” more over, the evidence suggests it is instead, the latest in a long string of contrived federal entrapment cases. If an attack occurs on US soil or against US allies in the near future under these circumstances, it is most likely Clapper, General Petraeus at the CIA, and Israel’s Mossad that will be to blame.

As was the case in Vietnam, and more recently the fraudulent casus belli against Iraq, the West is being led into another infinitely destructive war, jeopardizing the lives of millions, and further bankrupting already destitute nations reeling from 10 years of unending war. It is essential to raise awareness of US policy makers and their desire to provoke war with an unwilling adversary and the documented history the United States government has in manufacturing provocations when none can be goaded.

It is also important to remember that no matter how detestable our political leaders may be, there is a corporate-financier oligarchy above them pulling the strings. It is important to vote warmongers out of office, but just as important to identify the strength of the corporate-financier oligarchs that drive them and undermine them at all costs.

Tony Cartalucci is the writer and editor at Land Destroyer Report

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