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What the Aggravation of the US-Iranian Relations Means for South Korea

By Konstantin Asmolov – New Eastern Outlook – 06.09.2019

Continuing to monitor the confrontation between Washington and Tehran, the author of this article can see how it affects the South Korean interests. The sanctions badly hit South Korea’s economy and, since the summer of 2019, there have been attempts to involve Seoul in a possible military coalition.

Let us remind the reader that the Joint Comprehensive Action Plan was signed by Iran, Russia, the United States, Germany, France, the United Kingdom and China in 2015, limiting Iran’s nuclear program in return for lifting the sanctions imposed by the European Union and the United Nations.

The removal of most of the international sanctions from Iran stimulated a great interest in its economy, as the country has huge gas and oil reserves, and Seoul took advantage of the opportunity to enter the Iranian market. After all, the South Korean exports to Iran exceeded $6 billion in 2012, however, after the imposition of sanctions by the Obama Administration, it fell to $4.5 billion. In 2016, it fell even more and, only in 2017 did export volume begin to recover.

On August 24, 2017 the South Korean Export-Import Bank and the Central Bank of Iran signed an agreement on a $9,380 million loan to the Iranian Government. In addition, South Korean companies were given the opportunity to participate in construction and resource projects in Iran, as the loan was aimed at providing financial support to those who would receive orders from the Iranian Government.

It should be noted that the arrangement to start negotiations on the loan agreement was made during the visit of the former South Korean President Park Geun-hye to Iran, but the final decision was delayed since the parties could not agree on the terms of repaying the loan in case of the resumption of sanctions should Iran fail to fulfil its obligations in the nuclear technology area.

But after Donald Trump came to power, the White House began to criticize the terms of the nuclear deal and later withdrew from it; in May 2018, the US resumed its sanctions against individuals and legal entities that carry out export transactions in gold, precious metals, graphite, coal, automotive and other industries with Iran. However, for some countries, there was a delay of 90 and 180 days depending on the type of sanctions.

The South Korean government wasted no time and convened an ad-hoc expert working group assigned to reduce the damage to the domestic companies caused by the US sanctions against Iran. The complications came from the fact that more than 80% of South Korean enterprises working with Iran were small and medium-sized businesses. However, with the reinstatement of sanctions, exports from South Korea to Iran decreased yet again. From January to June 2019, they fell by 15.4%, and by 19.4% in July.

The South Korean government also negotiated with the US calling on it to exempt crude oil from the sanctions, as it accounts for most of the imports from Iran. Under the Barack Obama Administration, South Korea received the status of an exception country entitled to buy Iranian crude oil under the sanctions with reducing its purchases by 20%.  The importance of Iranian oil imports to South Korea lies in the fact that it has a direct impact on the exports to Iran. Settlements with Iran are made using the Korean won bank account from which goods exported to Iran are also paid for. Therefore, a reduction in the Iranian oil imports will inevitably lead to a reduction in the exports.

Moreover, Seoul remains one of the largest importers of Iranian oil and gas condensate in Asia. As noted by Reuters, the supply of Iranian resources is critical to the South Korean petrochemical industry. South Korea greatly relies on the supply of condensate from Iran, which has a high content of naphtha being the basic raw material for the manufacturing of petroleum products.  Besides, the Iranian prices are the lowest. The difference can reach six dollars per barrel, so 50% of the condensate imported into South Korea comes from Iran.

According to an opinion, South Korea is the third largest buyer of Iranian oil.   On the other hand, Iran accounts for 8.6% of the oil imported into South Korea and it is the fifth largest oil supplier to South Korea after Saudi Arabia, Kuwait, the United States and Iraq.

On October 29, 2018 US Secretary of State Mike Pompeo and South Korean Foreign Minister Kang Kyung-wha exchanged their views of the issue of US sanctions against Iran during a telephone conversation. Kang Kyung-wha called on the American party to show flexibility in granting South Korea the status of an exception nation in the implementation of sanctions against Iran in order to minimize the damage to South Korean companies. She mentioned the repeated negotiations between the parties on this topic. Pompeo said the US was heeding the position of South Korea and would continue the dialogue.

On November 5, 2018 the second stage of sanctions aimed at stopping foreign currency inflows to Iran thanks to oil exports entered into force. This affects the interests of South Korea, Turkey and India, which actively cooperate with Iran in the oil sector.

While the May sanctions were mainly aimed at a secondary boycott, the second stage included direct sanctions on transactions related to oil, natural gas, petrochemical products, ports, energy facilities and shipbuilding. The sanctions apply to approximately 700 individuals and legal entities, aircraft, ships and other facilities.

However, for eight countries (South Korea, China, India, Italy, Greece, Japan, Taiwan and Turkey) the US made a temporary exemption of 180 days, as each of them had demonstrated a significant reduction in Iranian oil purchases over the previous six months. The US sanctions are aimed at reducing the profit that Iran receives from trade, so permits to carry out trade are issued in exchange for the promise to reduce the purchase of Iranian raw materials. Thus, it will be possible to avoid an increase in oil prices. However, the US Special Representative for Iran Brian H. Hook confirmed that the 180-day exemption would not be extended.

As a result of this decision, South Korea managed to avoid the worst possible scenario, but experts immediately noted that the impact on the economy would not be averted altogether. As a result, the authorities recommended that businesses pay attention to the exports of pharmaceutical products, household appliances and other goods that were not subject to sanctions.

Immediately after the introduction of sanctions, representatives of the South Korean government visited Iran to discuss mutual trade issues. It is pointed out that the parties touched upon the situation with the resumption of the US sanctions and the withdrawal of a number of countries from the ban on the import of Iranian oil. The Iranian party thanked South Korea for consulting it on the current situation.

On April 29, before the end of the exemption period, Deputy Prime Minister for Economy and Minister of Planning and Finance Hong Nam-ki said that the South Korean government would make every effort to stabilize the domestic prices of petroleum products, which may increase due to the ban on the purchase of Iranian oil imposed by the US.

The exemption period for the eight countries expired on May 2, 2019. Now, all of them had to look for other suppliers, given the threat of US sanctions, but the Turkish government reported that it was impossible to stop Iranian oil imports immediately and Beijing said it would not support the unilateral US sanctions considering the significant losses associated with the need to change the suppliers. The South Korean government, through various channels, tried to bring South Korea out of the Iranian sanctions regime, but it failed. Iraq, which was importing natural gas from Iran, asked the US to provide more time to find another supplier, but the request was denied. This situation, among other things, destabilized world oil prices.

On June 20, 2019 the South Korean delegation held talks with the US party on the trade with Iran. The South Koreans called on the US to assist in eliminating possible difficulties in the oil issue and to resolve the problems of South Korean companies working with Iran in humanitarian areas using the Korean currency accounts only. However, the request was de facto ignored.

On the other hand, as from the summer of 2019, South Korea has been increasingly involved in the US-led security coalition in the Strait of Hormuz, which is the only waterway connecting the Persian Gulf and the Indian Ocean between the Arabian Peninsula and Iran and serves as the key transport corridor for large oil-producing countries.

Washington has called on Seoul to participate in this coalition citing the importance of the Strait for South Korea as the main oil transportation corridor. On the other hand, South Korea closely cooperates with Iran in the economic sphere. In this regard, Iranian response measures cannot be ruled out.

On July 24, 2019 during his meeting with the national security advisor to the President of South Korea, Chung Eui-yong, John Bolton demanded not only an increase in the share of South Korea in maintenance costs of US troops, but also the deployment of South Korean naval forces in the Strait of Hormuz.

On July 28, a representative of the South Korean Ministry of Defense noted that the country was considering various options for joining the coalition to ensure security in the Strait of Hormuz, but, at the moment, no specific decisions on this topic had been taken and no official proposals from the US had been received either. However, given the issue of the security of South Korean vessels passing through the Strait of Hormuz, various options for sending a military contingent to the region are being considered, including the possibility of sending the Cheongye unit currently patrolling the Gulf of Aden.

On August 9, Seoul hosted a meeting of the heads of the defense ministries of South Korea and the United States, Jeong Kyeong-doo and Mark T. Esper. Korea Times notes that Mark Esper officially asked Korea to participate in the coalition, but, almost immediately after that, Iranian Foreign Ministry spokesman Seyyed Abbas Mousavi called on South Korea to remain neutral. Mousavi noted that Seoul was an economic partner and asked it to take into account the sensitivity of the issue. “Korea’s possible joining the coalition is not a very good signal for us, and it will complicate things.”

South Korean experts, however, immediately wrote that the government should take the US side. As Meiji University Professor of Political Science Sing Yeoul said, “Diplomacy is not about being praised by all countries. You often have to choose one country over another, even if it means that you have broken ties with the latter.”

On August 13, the 30th outfit of the Cheongye special unit of the South Korean Navy left the South Korean port of Busan for the Gulf of Aden for a 6-month patrolling. It was headed by the destroyer Gang Gam-chan.  The 300-strong army unit consists of a special force, including a submarine bomber team, a Navy Seal team, Marines and Navy pilots, who will protect South Korean vessels off the coast of Somalia and support ships of other countries in the nearby waters.

The experts began to discuss the possibility of this detachment joining the security coalition in the Strait of Hormuz, but agreed that the approval of the National Assembly was required for the redeployment of Cheongye to the Strait of Hormuz. It is said that this topic also emerged at the meeting of the defense ministers, and Jeong told Esper that South Korea was well aware of the importance of water area defense and was considering various options to protect its nationals and oil tankers in the region.

However, the destroyer should continue the unit’s mission in the Gulf of Aden and its possible role in the Strait of Hormuz was not considered during its preparation. However, the Gulf of Aden is four-day sail away from the Strait of Hormuz.

On August 21, the US Special Representative for Iran Brian H. Hook told KBS that joining the coalition would not necessarily mean sending troops and that dispatching naval and aviation equipment with the necessary personnel could be a solution. Furthermore, countries joining the coalition will be able to obtain information from the US on certain threats to merchant ship security.

The problem got another dimension in the context of the Japan-South Korean trade war. Mark Esper invited not only South Korea to join the US-led coalition, but also Japan, and it is a good question how the servicemen of the two countries are going to work together.

Thus, there is a possibility that, if a war with Iran is indeed going to happen, then, same as in Vietnam or Iraq, the South Korean military will also be involved. After all, it was not some conservative and pro-American puppet who sent troops to Iraq, but the democratic Roh Moo-hyun.

Konstantin Asmolov, PhD in History, Leading Research Fellow at the Centre for Korean Studies of the Institute of Far Eastern Studies of the Russian Academy of Sciences.

September 6, 2019 Posted by | Economics, Militarism, Wars for Israel | , , | Leave a comment

Macron starts pension rollback despite protests

By Ramin Mazaheri – Press TV – September 6, 2019

Paris – After being forced to delay because of the Yellow Vest anti-austerity movement, French President Emmanuel Macron has begun his right-wing pension reform which is already certain to provoke major protests this month.

Macron is pushing for a one-size-fits-all, universal system, to force workers to pay more and for employers to pay less, and to effectively raise the retirement age from 62 to 64 years old for many workers.

Every major union except one is opposed to the major change, and a poll this week showed nearly 70% of France has ‘no confidence’ in Macron’s reform. However, Macron has repeatedly ignored public opinion and even bypassed Parliament to force through neoliberal reforms by executive order.

Many say a universal pension system favors the highly educated and is inherently unjust to manual laborers. For example, how can a railway worker who has straightened train tracks in all types of weather since the age of 18 be compared with someone with an upper-level university degree who didn’t start their air-conditioned office job until the age of 26?

As has been the case since 2010, France’s government says the reforms are necessary for investor confidence and that they will eventually bear fruit.

France and the entire Eurozone has already endured a lost decade of economic growth, as their economies remained burdened by debt and compound interest in order to pay off the failures by corporate bankers in the previous decade.

September 6, 2019 Posted by | Economics | | Leave a comment

JCPOA Negotiations are a test of the EU’s geo-political credibility

By Padraig McGrath | September 5, 2019

On September 4th, Iranian President Hassan Rouhani said that Iran would give the EU a further 60 days to come back into compliance with its economic commitments under the JCPOA before Iran would initiate a third phase of withdrawal from its own obligations under the deal. On September 29th, the International Atomic Energy Agency confirmed that Iran has been enriching uranium to a purity of 4.35%, which marginally exceeds the limit of 3.67% stipulated under the terms of the JCPOA.

Furthermore, Iran has at this point exceeded the stockpile of 300 kilograms of nuclear fuel which was agreed upon in 2015. These measures are quickly reversible, but likewise, Iran also has the technical capacity to very quickly implement any decision to further suspend its commitments. The Iranian government has said that it has the technical capacity to resume production of 20% enriched uranium within 48 hours, were it to take such a decision.

The stumbling-block in the negotiations is that, with the United States having withdrawn from the JCPOA and re-imposed sanctions on Iran following Donald Trump’s assuming office as US president in 2017, the EU finds compliance with its own JCPOA-obligations extremely difficult, as European banks fear being hit by sanctions themselves if they un-freeze Iranian assets or facilitate transactions relating to Iranian oil-exports. US federal law states that, ultimately, all dollar-denominated banking-transactions worldwide ultimately have to pass through the US banking-system. Therefore, the strategic advantage conferred on the US by dollar-hegemony is not simply that it artificially inflates the value of the dollar, but also that it brings all dollar-denominated transactions worldwide under US legal jurisdiction.

In an attempt to find a workaround, French president Emanuel Macron has proposed that the EU should extend a $15 billion letter of credit to Iran, which would be guaranteed by Iranian oil-exports, thereby compensating Iran for losses of revenue owing to US sanctions. The Iranians have already rejected the first version of this offer, wherein this $15 billion package was classified as a loan rather than as a letter of credit. The distinction is crucial, as classifying the $15 billion package as a letter of credit would prevent the western powers from trapping Iran in a vice-grip composed simultaneously of an oil-embargo in addition to the obligation to service debt. Iran’s Deputy Foreign Minister Abbas Araqchi has explained that such a letter of credit would in effect be a pre-sale of oil.

However, the crucial weakness in this solution is that it will still require a waiver from the US government, which seems improbable considering Trump’s intransigence and US National Security Advisor John Bolton’s opposition to the plan.

Although, in the interests of fairness, we should extend some credit to President Macron for his diplomatic initiatives in an effort to find a way out of the impasse, the situation which exists still amounts to a very serious test of the EU’s credibility as a distinct negotiating-entity. The principal EU negotiator in the talks which led to the 2015 JCPOA-deal, EU High Representative for Foreign Affairs and Security Policy Federica Mogherini, has shown extreme weakness and passivity since the American withdrawal in 2017. Having worked hard to hammer out the terms of a deal, she has subsequently done absolutely nothing to defend it.

The net result is that the EU is currently in violation of its JCPOA-obligations because it has folded in the face of US economic bullying. What exactly is the point of bothering to negotiate with the EU if it is incapable of maintaining an independent policy on foreign relations, finance or security?

Another question thrown up by this diplomatic shambles is, considering that the number of countries worldwide being targeted by unilateral US economic sanctions is ever-increasing, when do we hit a tipping-point wherein this increasingly trigger-happy US policy, hitting the sanctions-button on reflex, has an accelerating effect in de-dollarization as a global process?

Banking-systems are dependent on a certain minimal level of systemic trust. How can the US hope to maintain its financial role in the world economy if everybody else is continuously reminded that their dollar-denominated assets worldwide can arbitrarily be frozen or seized at any time?

Already, the four largest banks in the world are Chinese. The only factor which has so far delayed China’s assumption of the role of the world’s banker is that the Chinese government has not yet decided to make the Yuan a more easily tradable currency. Further preparation is still required before the Chinese decide to flick that switch. Once they eventually do, it’s game over for the Dollar.

It is understandable that the Chinese have not yet decided to make the Yuan as tradable as other reserve-currencies, but their principal concern is not fears of vulnerability to speculators and raids. The capitalization of China’s state-owned financial institutions is such that, together, they could easily mobilize enough volume to defend the Yuan’s value against raids, or for that matter to suppress its value, any time they needed to.

I believe that the preparation which the Chinese government most centrally has in mind prior to any decision to make the Yuan fully tradable is the completion of the fibre-optic component of the Belt and Road Initiative. The strategic importance of these fibre-optic pipelines is the most under-emphasized aspect of Belt and Road. Once this physical infrastructure is in place, it will be possible to entirely circumvent American efforts toward virtual piracy in the form of unilateral sanctions. That will have a transformative effect on the world economy. The erosion of dollar-hegemony has been very gradual over the past 15 years, but if we are to see a sudden acceleration, a tipping-point, then that will be it.

It is quite probable that, in anticipation of this, odes to the Petro-Yuan are already being written in Farsi.

Padraig McGrath is a political analyst with InfoBRICS

September 5, 2019 Posted by | Economics | , , , | Leave a comment

Asian Century bypasses Modi’s India

By M. K. BHADRAKUMAR | Indian Punchline | September 1, 2019

The stunning news that India’s GDP growth rate is hitting a six-year low figure of 5 percent in the past six-year period comes as reality check. Many economists even hold the view that in actuality, take away the statistical jugglery, India’s actual GDP growth figure could be somewhere around 3 percent.

Either way, it is a dismal scenario. As mostly the case, it is the poor people who will suffer from the decline in the GDP growth rate than the rich. There is going to be a significant decline in the employment rate and the number of people below poverty line could rise. Clearly, the 5-trillion dollar economy that Prime Minister Narendra Modi boasted about as his second term began 100 days ago, seems a pipe dream. Even to recall PM’s quote becomes a painful embarrassment.

In a Reuters poll of economists, analysts believe the slowdown could persist for two or three years while much needed structural reforms are put in place. The Reserve Bank of India (RBI) said on Thursday a big push on infrastructure spending would be needed to revive consumer demand and private investment. Structural reforms were also required to ease the path for businesses in India, it said.

What causes such profound disquiet is that all this appears to go way beyond a cyclical slowdown. The economy has lost momentum.

To be sure, the government policy approach will need to be multi-pronged. But this is also fundamentally a crisis of India’s political economy. Watch former PM Manmohan Singh’s stern warning that the looming crisis should not be underestimated, as it is a combustible mix of many elements that aren’t easy to separate — deficiency in statecraft, populist politics, political vendetta, flawed economic measures, bad economic management, lack of accountability, authoritarianism, etc.

There is a crucial foreign-policy dimension to it — India is in critical need of a peaceful external environment so that it can prioritise the economy. Plainly put, the government needs to apply itself diligently to keep down tensions in relations with Pakistan.

All that talk by senior cabinet ministers about “nuclear first use” and of “taking back” POK and Northern Areas from Pakistan is hogwash. Standing on such emaciated legs, no country can wage a war. Just throw into the dustbin all that jingoism.

Misplaced national priorities have brought the economy to a cul-de-sac. Glance through the statistics of the top ten fastest growing Asian economies today: Bangladesh (8.13%) ; Nepal (7.9%); Bhutan (7.4%); China (6.9%); Myanmar (6.8%); Philippines (6.7%);  Malaysia (5.9%) Pakistan (5.4%); Indonesia (5.1%); India – 5%

Modi becomes the first prime minister of independent India to take the country’s GDP growth rate below Pakistan’s. This should be rude awakening and should prompt honest soul-searching.

What a wasteful foreign policy our country has been saddled with, focusing on vainglorious projects that have no relevance to the “real India”! How does it help India if PM worships at the Krishna temple in Bahrain or receives the highest national award of the Emirati nation?

Alas, the diplomatic calendar of the present government since it took over in May shows that we are still focused on dream projects to boost the image of the Leader in the domestic audience and to pursue a US-centric foreign policy.

The foreign-policy priority today is to somehow “lock in” the Trump administration by buying more oil and LNG from the US even if at a much higher cost than what Iran is able to supply. By succumbing to the US diktat, India is compelled to import phosphates — a vital input for farming sector — via enterprising Emirati middlemen rather than directly from Iran, at an increased cost of 30 percent! Who cares?

The government prioritises a mega energy conference in Houston, Texas, later this month so that we can buy more energy from the US — and also, explore proposals for massive Indian investments in the American energy sector. The idea is to substantially contribute to “America First” so that Trump is somehow kept happy and the long-term “Indo-Pacific strategy” aimed at containing China can be pursued without hiccups.

Of late, the thrust of Indian diplomacy lies in warding off the Pakistani challenge on the Kashmir issue. But the more we go on that track, the more work it generates for our diplomats to “counter” the Pakistani backlash. It is all turning out to be a Catch-22 situation.

Not all the waters in the Ganges can clean the accumulating filth of the comparisons being bandied about in the world media between Modi’s India and Nazi Germany. We are going to get even more of all that when the European Parliament meets tomorrow to exchange views on the situation in J&K.

Delhi got the tip-off that the POK Prime Minister Raja Farooq Haider will be present at the European Parliament when it will discuss the Kashmir issue on September 2. So, External Affairs Minister S. Jaishankar gets through to Brussels post-haste in the weekend with tons of detergent powder to sanitise the lobby. Raja Farooq Haider versus Subrahmanyam Jaishankar: nothing could more graphically highlight the tragedy of Indian diplomacy today.

Forget about India attracting western businessmen as an investment destination in the prevailing setting. And, make no mistake, no one is yet accounting for the massive haemorrhage of resources in the deployment of a million troops in J&K till eternity. How many world economies can sustain such a futile enterprise?

Not even the US, the lone superpower. Trump has programmed his diplomats to delver on his stern demand that the American troop level in Afghanistan should be drastically reduced in immediate terms — from 14,000 troops to 8,600 troops. He thinks it is “ridiculous” and stupid that a great army trained to fight wars is deployed for police duties. Trump is pressing hard for a political solution.

Doesn’t some of all this rub on Modi when he converses with the leaders of Bangladesh, Nepal and Bhutan, the three top “Asian tigers”? Don’t they talk serious stuff when they get quality time with Modi — how well their countries are growing but how much better they still could if only India ceases to be a laggard in the neighbourhood?

September 1, 2019 Posted by | Civil Liberties, Economics, Illegal Occupation | , , | Leave a comment

India begins sending Russia money for S-400s despite pressure from US

RT | August 29, 2019

New Delhi started paying for the state-of-the-art Russian S-400 air defense missile systems it ordered, as Washington failed to pressure the country into scrapping the major arms deal with Moscow.

Moscow has received an advanced payment for the weapon systems, the spokesperson for the FSVTS, the government agency responsible for coordinating arms trades, confirmed on Thursday.Russia and India sealed the $5.4bn deal in October after lengthy talks. Moscow is now due to ship five batteries of the S-400s by 2023.

The contract is a headache for the US, which has tried to pressure India into scrapping the sale. Officials in New Delhi, however, maintain that the S-400 is essential for national defense and have decided to stick with the purchase, despite the risk of violating US sanctions on Russia.

Similarly, Washington tried to dissuade its NATO ally, Turkey from buying S-400s from Moscow. Ankara also refused to budge, insisting it is free to choose the countries it purchases weapons from. Turkey began receiving components of the S-400s last month.

India has also ordered 21 new MiG-29 jet fighters from Russia and, on Wednesday, signed an agreement to upgrade the MiGs it already has.

August 29, 2019 Posted by | Economics | , | Leave a comment

Washington’s Nord Stream 2 Sanctions May Have Boomerang Effect on US Interests – German Media Reports

By Svetlana Ekimenko – Sputnik – 27.08.2019

The US Congress has moved forward with legislation to impose sanctions on the Nord Stream 2 pipeline project in defiance of criticism from Washington’s allies in Europe, as the joint venture brings together Russia’s Gazprom, Germany’s Uniper and Wintershall, Austria’s OMV, France’s Engie, and Anglo-Dutch Royal Dutch Shell.

Possible US sanctions against companies involved in the construction of the Nord Stream 2 pipeline could potentially harm US oil and gas projects in the Gulf of Mexico, writes the German business newspaper Handelsblatt.

“From the point of view of Germany, the name of the US proposed sanctions bill, ‘Protecting Europe’s Energy Security Act’, is in itself an insolence”, writes the author.

The US is pushing to impose sanctions against Nord Stream 2 despite likely consequences that such restrictions may have.

Thus, European companies involved in laying the pipeline and targeted by Washington’s sanctions play a key role in the global energy market.

For a long time, these companies worked in the Gulf of Mexico as subcontractors of the American corporations Chevron and Exxon Mobil, recalls Handelsblatt.

Therefore, if they are included in the sanctions lists, projects in the Gulf of Mexico will be disrupted, since it is impossible to quickly replace such highly specialised firms.

Overall, the US economy views the proposed sanctions against Nord Stream 2 critically, the author points out. Such restrictions would also be likely to harm US gas exporters, prompting European buyers to reduce LNG imports from the United States and increase supplies from other countries.

Proposed US Sanctions on Nord Stream 2

The Nord Stream 2 project has long drawn opposition from a number of countries, with the United States, which is trying to sell more of its own liquefied natural gas to overseas allies, insisting that the project will make Europe dependent on Moscow – claims that Russia has repeatedly rebuffed.

Moscow has insisted that the pipeline project is strictly commercial, ultimately seeking to boost Europe’s energy security.

Nevertheless, in early August, the US Senate Foreign Relations Committee approved a bill on sanctions against companies providing vessels for the Nord Stream 2 pipeline project.

The document prohibits entry into the US for anyone involved in the “sale, lease, provision or assistance in providing” ships for laying Russian offshore pipelines at a depth of 30 metres or more, as well as the freezing of their assets in US jurisdiction.

Companies from Austria, Germany, the Netherlands, France, Finland, and Sweden may fall under the sanctions.

The project is being implemented by Nord Stream 2 AG, with Gazprom investing half of the funds, and the remainder being contributed by European partners: Germany’s Uniper and Wintershall, Austria’s OMV, France’s Engie, and Anglo-Dutch Royal Dutch Shell.

Germany has been strongly behind Nord Stream 2, emphasizing the commercial focus of the project.

German Chancellor Angela Merkel said that she supported the BDI’s (Federation of German Industries) stance that the Nord Stream 2 pipeline for delivering Russian natural gas to Europe is necessary given the German initiative to stop using nuclear and coal energy.

Austria, which is interested in reliable supplies of fuel, and Norway, whose government owns 30 percent of the shares of Kvaerner, one of the gas pipeline construction contractors, also spoke in favor of the project.

Nord Stream 2 Project

The 745-mile-long (1,200 km) Nord Stream 2 twin pipeline is set to run from Russia to Germany through the territorial waters or exclusive economic zones of Denmark, Finland, Germany, Russia, and Sweden to deliver Russian gas to European consumers.

The completed project will double the capacity of the existing Nord Stream pipeline network, allowing a total of up to 110 billion cubic metres of Russian natural gas to be transported to Western Europe via pipelines at the bottom of the Baltic Sea.

According to a statement made by project operator Nord Stream 2 AG on 26 August, the pipeline is 75 percent complete.

August 27, 2019 Posted by | Economics, War Crimes | , , , , , , | Leave a comment

Iraq would face ‘wrath of US’ if oil pipeline projects with Iran go ahead

RT | August 27, 2019

Washington would do anything to prevent an Iran-Iraq oil pipeline from ever being built, even if the Europeans were in favor, policy researchers told RT.

“Iraq would feel the wrath of the US” should it pursue a cross-border pipeline project with its neighbor Iran, believes the head of the British-based consultancy firm Alfa Energy, John Hall.

According to a recent report, Tehran talked with Baghdad about building an oil pipeline through Iraq into Syria. The sides have also reportedly discussed reviving the existing pipeline connecting Kirkuk in Iraqi Kurdistan with the city of Baniyas on Syria’s Mediterranean coast. The pipeline was heavily damaged by US airstrikes in 2003 and has remained defunct since. The proposed project is said to be aimed at providing an alternative route for Iranian oil should the Strait of Hormuz be closed in case of a direct conflict with the US.

Hall said Washington would be “upset” by this idea and will do all it can to dissuade Baghdad, as well as the EU, from participating.

Although European countries would be happy to buy oil from Iran, they won’t do so because of the threat of retribution from the United States. When you’ve got someone like Donald Trump as the president of the US, it’s very difficult knowing what may follow if Europeans try to engage with Iran across the sanctions.

The situation in civil war-torn Syria “has somewhat stabilized,” Iran and Iraq see “serious opportunities” to explore their energy ties, said Irina Fyodorova, a senior Middle East researcher at the Institute of Oriental Studies at the Russian Academy of Sciences.

“It is not the US’ interest to have a pipeline that would be independent from them and their allies in the Persian Gulf,” she told RT.

It is also against US interests to have an Iran-Iraq cooperation that is outside of their control. So there will be actions aimed at hampering the implementation of this project.

One of the steps Washington and its allies could take is boosting their support for anti-government groups in Syria, she said. The researcher added that another problem for the pipeline would be the US-backed Kurdish forces, should it go from Kirkuk.

EU countries, on the other hand, would like to see new ways to bypass US sanctions on Iranian oil, Fyodorova noted, as “getting the oil through a pipeline would be cheaper than having it delivered by tankers.”

“The Europeans love balancing the books. Moreover, it would be a wonderful alternative to the oil the EU is buying from the US.”

August 27, 2019 Posted by | Economics, War Crimes | , , , , | Leave a comment

Iran tourist arrivals neared 8 million in early 2019: Tourism chief

Press TV – August 26, 2019

Head of Iran’s government department on tourism says around eight million foreigners visited the country in the last Iranian calendar year ending in March 2019.

“Some 7.8 million foreign tourists arrived in the country last year,” said Ali Asghar Mounessan, adding that the figure shows a 40-percent increase compared to the previous year.

Mounessan, who heads the Cultural Heritage, Handicrafts and Tourism Organization of Iran (ICHTO), said each tourists coming to the country spends an average sum of $1,400 during his stay, adding that almost all the money earned from tourists should be viewed as pure income as investment has been very low compared to the revenues generated in the sector.

He said the boom in tourism arrivals and revenues have come despite sanctions imposed by the United States in the past year, adding that major accommodation places across the country have been booked up for months to come.

Mounessan, a deputy president whose department is planned to be turned into a ministry in the coming months, said the government would double the budget earmarked to the tourism and handicraft management as the sectors keep attracting massive foreign currency into the country.

The official also said that Iran eyes $2 billion worth of exports of handicraft, saying that all provinces across the country had huge potentials that could be used to meet the target.

Mounessan said the decision to turn the ICHTO to a ministry would also allow the government to have a better policy for protection of historic monuments and artifacts existing across the country, saying that would further boost arrivals of the tourists who are mainly interested in visiting Iran’s cultural heritage.

August 26, 2019 Posted by | Economics, Timeless or most popular | , | Leave a comment

U.S. To “Drown The World” In Oil

By Nick Cunningham – Oilprice.com – August 21, 2019

The U.S. could “drown the world in oil” over the next decade, which, according to Global Witness, would “spell disaster” for the world’s attempts to address climate change.

The U.S. is set to account for 61 percent of all new oil and gas production over the next decade. A recent report from this organization says that to avoid the worst effects of climate change, “we can’t afford to drill up any oil and gas from new fields anywhere in the world.” This, of course, would quickly cause a global deficit, as the world continues to consume around 100 million barrels per day (bpd) of oil.

Global Witness notes that the industry is not slowing down in the United States, notwithstanding recent spending cuts by independent and financially-strapped oil and gas firms. If anything, the consolidation in the Permian and other shale basins, increasingly led by the oil majors, ensures that drilling will continue at a steady pace for years to come.

It isn’t as if the rest of the world is slowing down either. The global oil industry is set to greenlight $123 billion worth of new offshore oil projects this year, nearly double the $69 billion that moved forward last year, according to Rystad Energy. In fact, while shale drilling has slowed a bit over the past year amid investor skepticism and poor financial returns, offshore projects have begun to pick up pace.

But that trend might turn out to be just a blip. The U.S. is still expected to account of the bulk of new drilling and the vast majority of new production, with much of that coming from shale. Already, the U.S. is the world’s largest producer of both oil and natural gas. And the pace has accelerated in recent years. In 2018, U.S. oil and gas production increased by 16 and 12 percent, respectively. According to the EIA, the U.S. surpassed Russia in terms of gas production in 2011, claiming the top spot, and it surpassed Saudi Arabia in oil production last year.

Going forward, new production from the U.S. will be eight times larger than the next largest source of growth, which is Canada. In fact, the U.S. will add 1.5 times more oil and gas than the rest of the world combined, according to Global Witness.

But because so much drilling in the U.S. is concentrated in a few areas, individual U.S. states on their own tower over the rest of the world. If Texas were a country, it would account for the most new oil and gas production in the world. Between 2020 and 2029, Texas could account for 28 percent of all additional output, Global Witness says.

Canada and Pennsylvania tie for second and third with 7 percent each. Then comes New Mexico at 5 percent of the growth and North Dakota at 4 percent. Oklahoma, Brazil, Colorado, Russia and Ohio are all tied at 3 percent a piece.

In other words, 7 out of the top 10 sources of new oil and gas production globally over the next decade are U.S. states.

“If things don’t change, by the end of the next decade, new oil and gas fields in the US will produce more than twice what Saudi Arabia produces today,” Global Witness said in its report.

This presents a massive challenge. “To avoid the worst impacts of climate change, our analysis shows that global oil and gas production needs to drop by 40% over the next decade. Yet, instead of declining, US oil and gas output is set to rise by 25% over this time, fueled by expansion in new fields,” the report warned.

August 22, 2019 Posted by | Economics, Malthusian Ideology, Phony Scarcity | , | Leave a comment

Petitioning Against Climate Alarmism Goes Global

By Larry Bell ~ PA Pundits – International ~ August 21, 2019

A petition being submitted by hundreds of independent climate scientists and professionals from numerous countries to heads of the European Council, Commission and Parliament declares “There is No Climate Emergency.”

Briefly summarized, the request for consideration conveys five urgent messages:

  • Climate change is real and has been occurring with nature-driven cold and warm cycles for as long as the planet has existed.
  • There should be no surprise that the Earth has been warming through natural causes since the last Little Ice Age ended around 1870. Actual temperature increases, however, are far less than predicted by theoretical climate models.
  • There is no real evidence that anthropogenic (human-caused) CO2 emissions are a major or dangerous warming influence. They instead offer great benefits to agriculture, forestry and photosynthesis that is the basis for life.
  • There is also no scientific evidence that increasing CO2 levels are causing more natural disasters. However, CO2-reduction measures do have devastating impacts on wildlife (e.g. wind turbines), land use (e.g. forest clearance), and vital energy systems.
  • Energy policies must be based on scientific and economic realities — not upon a harmful and unrealistic “2050-carbon-neutral policy” driven by unfounded climate alarm.

The petition concludes by recommending the recognition of clear difference in policies addressing the Earth’s environment through good stewardship versus Earth’s climate, the latter of which “is largely caused by a complex combination of natural phenomena we cannot control.”

This recent petition to EU leaders signed by approximately 100 Italian scientists from many prominent organizations urges recognition of the same basic realities.

The Italian petition calls attention to the fact that the planet has previously been warmer than the present period, despite lower atmospheric CO2 concentrations. Warming periods have been repeated about every thousand years, including “the well-known Medieval Warm Period, the Hot Roman Period, and generally warm periods during the Optimal Holocene period.”

Most recent climate warming observed since 1850 followed the Little Ice Age – the coldest period of the last 10,000 years. “Since then, solar activity, following its [previous cooling-influence] millennial cycle, has increased by heating the Earth’s surface.”

The notification advises that climate, “the most complex system on our planet,” needs to be addressed with scientific methods that are “adequate and consistent with its level of complexity.”

This system “is not sufficiently understood. And while CO2 is indisputably a greenhouse gas, “according to [UN Intergovernmental Panel on Climate Change] IPCC itself, the climate sensitivity to its increase in the atmosphere is still extremely uncertain.”

The petition states that “In any case, many recent studies based on experimental data estimate that the climate sensitivity to CO2 is considerably lower than estimated by the IPCC models.” Accordingly, all evidence suggests that such models “overestimate the anthropic [human] contribution and underestimate the natural climatic variability, especially that induced by the sun, the moon, and ocean oscillations.”

Likewise, alarmist media claims that extreme weather events, such as hurricanes and cyclones, are increasing in frequency are entirely inaccurate and typically far more directly tied to natural ocean oscillation cycles.

Again, the Italian signatories from numerous universities and research organizations take strong issue against “deplorable propaganda” claiming that carbon dioxide is a pollutant rather than a molecule that is indispensable to life on our planet.

Accordingly, given “the crucial importance that fossil fuels have for the energy supply of humanity,” the petitioners urge that the EU should not adopt economically burdensome and unwarranted CO2 reduction policies under “the illusory pretense of governing the climate.”

The petitioners also emphasize that while credible facts must be based upon scientific methods, not determined by numbers of supporting theorists, there is no alleged “consensus” among specialists in many and varied climate disciplines suggesting that human-influenced climate change presents an imminent danger. They point out that many thousands of scientists have previously expressed dissent with alarmist anti- fossil energy conjecture.

More than 31,000 American scientists from diverse climate-related disciplines signed a Global Warming Petition Project rejecting limits on greenhouse gas emissions attached to the 1977 Kyoto Protocol and similar proposals. The list of signatories included 9,021 Ph.D.s, 6,961 at the master’s level, 2,240 medical doctors, and 12,850 carrying a bachelor of science or equivalent academic degree.

A 12-page petition attachment was introduced with a cover letter issued by Fredrick Seitz, a past president of the National Academy of Sciences and former president of Rockefeller University. It read, in part:

“This treaty is, in our opinion, based upon flawed ideas. Research data on climate change do not show that human use of hydrocarbons is harmful. To the contrary, there is good evidence that increased atmospheric carbon dioxide is environmentally helpful.”

The letter added, “The proposed agreement would have very negative effects upon the technology of nations around the world, especially those that are currently attempting to lift from poverty and provide opportunities to over 4 billion people in technologically undeveloped countries.”

Gratefully, an American Congress at that time listened to that sage advice and unanimously agreed. We can only fervently hope that more current legislators will continue to be equally wise.

Larry Bell contributes posts at the CFACT site. He heads the graduate program in space architecture at the University of Houston. He founded and directs the Sasakawa International Center for Space Architecture. He is also the author of “Climate of Corruption: Politics and Power Behind the Global Warming Hoax.”

August 22, 2019 Posted by | Economics, Environmentalism, Science and Pseudo-Science | Leave a comment

US demands that Turkey should cease all activity in Cyprus waters

MEMO | August 20, 2019

The US State Department has called on the Turkish authorities to remove its drilling vessels from the territorial waters around Cyprus and to cease immediately any “unlawful activities”.

The demand comes as Turkey has established a significant presence in the waters off the Mediterranean island; Turkey’s Yavuz, Fatih and Barbaros research vessels are drilling in search of natural gas and energy reserves. Yesterday, Turkish Foreign Minister Mevlut Cavusoglu announced that a fourth Turkish ship, the Oruc Reis research vessel, is en route to the area.

In response to questions from the Greek-language news outlets Hellas Journal and Cyprus News Agency, the State Department said that, “This provocative step raises tensions,” and that only the government of Southern Cyprus can consent to the drilling and any other activities within its Exclusive Economic Zone (EEZ). Turkey claims that the EEZ also belongs to the northern administration of the island, the Turkish Republic of Northern Cyprus (TRNC), which it supports.

The State Department added that the development of natural resources in the Mediterranean should promote cooperation and lay the foundation for sustainable economic prosperity and energy security. The comments echo those made by the US Ambassador to Cyprus, Judith Garber, in early June, in which she expressed her deep concerns over Turkey’s drilling operations and urged it to halt the exploration for energy reserves in the surrounding waters. “Resources should be equitably shared between both communities in the context of an overall settlement,” the ambassador insisted. “It is our earnest hope that such resources will soon benefit a united Cyprus.”

The US demand follows increasing tensions in the eastern Mediterranean region over the past couple of months, after the Turkish vessels were sent in retaliation for a deal struck by Greece, Southern Cyprus and Israel in early June, in which the three states agreed to build a pipeline harnessing the reserves of natural gas off the southern shores of the island. The “EastMed” pipeline, which is estimated will produce a profit of $9 billion over eighteen years, will supply gas from the eastern Mediterranean region all the way to countries in Europe.

The tripartite deal, backed by the US, angered Turkey and prompted it to demand equal access to the resources, a share of the reserves for itself and the TRNC, and a stake in the deal, which was rejected. Turkey then insisted that it will continue its drilling activities off the shores of Cyprus until its offer has been accepted, and that it is determined to protect the rights of the island’s Turkish population and northern Cypriots.

Since Turkey’s seizure of the northern part of Cyprus in 1974 for the protection of its Turkish inhabitants, the two sides have faced disputes and tensions, as well as an attempt to hold talks. In 2017, these talks collapsed but, despite this, the Greek Cypriot side has continued to explore energy resources around the island.

READ:

Turkey to establish naval and air bases in Northern Cyprus

The EastMed pipeline is another front in the encirclement of Turkey

August 20, 2019 Posted by | Economics, Wars for Israel | , , | Leave a comment

Why the World Is Watching the Fate of an Iranian Tanker in the Mediterranean

Will the Greeks seize it on a US warrant?

By Vijay Prashad – Monthly Review – August 19, 2019

At 11:30 p.m. on August 18, the Iranian tanker Adrian Darya 1 left the shores of Gibraltar at the mouth of the Mediterranean Sea. This ship had been detained 46 days ago by British Royal Marines and Gibraltar’s officials. The British claimed that the ship—then named Grace 1—was taking its cargo of 2.1 million barrels of oil to Syria. There are European Union sanctions against trade with the Syrian government. It is based on these sanctions that the British seized the Iranian vessel.

Last Thursday, on August 15, Gibraltar’s Chief Minister Fabian Picardo ordered the release of the ship after the Iranian authorities said it would not be going to Syria. The immediate destination for Adrian Darya 1 is the Greek port of Kalamata.

Sanctions on Iran

The British, it is clear, seized the Iranian tanker at the urging of the United States. There was no previous British warning that it might enter in such a muscular way into the U.S. attempt to suffocate Iran. Even the location of the seizure unnecessarily raised tensions for the United Kingdom. The waters around Gibraltar are contested between Britain and Spain, with the latter making noises about a formal complaint about the British action.

Gibraltar’s government has been trying to find a middle course between the claims of Britain and Spain. It seeks some form of independence, although with close ties with both its large neighbor and its formal occupant. When the UK asked Gibraltar’s authorities to get involved in the seizure of the Iranian tanker, Gibraltar’s government complied because the request was in line with European Union sanctions against trade with the Syrian government.

In Gibraltar’s courts, the British were largely silent. The case against the Iranian vessel was made by the United States, which changed the basis for the seizure. The U.S. argued that the vessel had to remain impounded as part of its new and harsh sanctions regime against Iran. When Gibraltar was preparing to release the ship, the U.S. District Court in Washington, D.C., issued a warrant for the ship. This emergency warrant alleged that the ship was owned by the Iranian Revolutionary Guards and therefore must not be allowed to sail.

Gibraltar did not agree. The U.S. tried to use its 1977 International Emergency Economic Powers Act, and the new sanctions regime by the Trump administration. None of this appealed to the judiciary in Gibraltar. The government of Gibraltar said that it did not accept the new U.S. sanctions regime on Iran. It had held the vessel based on the European Union sanctions on Syria, not on any EU sanctions on Iran. Therefore, it has allowed Adrian Darya 1 to sail.

Iran’s Reaction

New statistics show that Iran’s economy has been decelerating at a rapid pace. The numbers from the Statistical Center of Iran show that Iran’s GDP shrank by 4.9 percent in 2018-19. Economic growth is slipping backwards, as the sectors of oil, industry, and agriculture post negative numbers. Inflation continues, with the inflation rate now at the highest it has been in a quarter of a century. Iranian traders have been moving their goods to Iraq, which results in the rise of prices within Iran. Most stunningly, the prices of non-trade goods and services—such as health and housing—are rising. All this has put enormous pressure on the government of Hassan Rouhani, although his spokesman Ali Rabiei said on Monday that Iran’s economy is experiencing “positive signs.”

Confidence from the Iranian government is remarkable. Officials in Tehran refuse to be cowed by the pressure from Washington, D.C. When the Adrian Darya 1 left Gibraltar, senior Iranian parliamentarian Alaeddin Boroujerdi said that its release was a result of “the revolutionary diplomacy of resistance.” He pointed to the seizure by Iran of the British ship Stena Impero, which continues to be detained in Iran. The British ship, Boroujerdi said, was being held for its violation of basic maritime rules in the Strait of Hormuz. The seizure of the Iranian ship—he pointed out—“was an act of piracy by England.”

Based on this assessment that the UK had indulged in piracy at the urging of the United States, Iran’s chief judge Ebrahim Raeisi said that the release of Adrian Darya 1 is not sufficient. Compensation must be paid to Iran. What compensation will be demanded from the UK is not clear, and it is further unclear where Iran will formally raise the issue of compensation. Iranian diplomats say that they might approach the United Nations based on the 1982 UN Convention on the Law of the Sea.

Will Greece Hold the Tanker?

Within the Trump administration there is appetite to further block the passage of Adrian Darya 1, and make it a flashpoint toward war. That is what Trump’s adviser John Bolton indicated when Gibraltar held the ship. Make your move, he seemed to suggest to Tehran. Iran told the U.S.—through the Swiss authorities—that it must allow the ship free passage. If the Adrian Darya 1 is blocked, it would set a terrible precedent for international shipping.

When the tanker enters Kalamata, it will likely take on a new crew and then set its next destination. There is no indication as to what the ship will do with its 2.1 million barrels of crude oil. It is likely that it will unload its cargo onto another ship in international waters.

Last week, the U.S. government asked Greece to contribute to its naval force in the Persian Gulf. Greece, with its new conservative prime minister, declined—as did France and Germany—to this new U.S. initiative. The Greek government, led by Kyriakos Mitsotakis, is eager for a close relationship with Washington, but it is not willing to enter a frontal clash with Iran. Greece is already in a heated situation with Turkey. To rattle Iran would only further complicate Greece’s fragile dance in the eastern Mediterranean. *

Greece, unlike the U.S., has taken the position that Iran has “the right to develop nuclear technology for peaceful purposes alone.” This is Iran’s position. The United States, as Professor Seyed Mohammad Marandi told Tricontinental: Institute for Social Research, opposes even a peaceful nuclear project for Iran. This is why Trump walked out of the 2015 nuclear deal. This is precisely why the U.S. has been putting immense pressure on Iranian shipping. And this is what led us to the story of the Adrian Darya 1.

*[Actually it is because of its “heated situation with Turkey” that Greece has sought US support at a high cost.] 

August 20, 2019 Posted by | Economics | , , , | Leave a comment

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