THE OIL WILD CARD


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Saudi Oil Giant on Fire

Over the weekend the Houthi faction in Yemen claimed responsibility for drone attacks which hit two major facilities run by Saudi Aramco, the country’s largest producer.

The impact affects five million barrels a day of crude oil which is nearly half of the Saudi output and 5 percent of the entire global oil supply.  

This comes as no surprise given Houthi’s long standing threats to counter Saudi Arabia’s aggression in Yemen since March 2015 that has resulted in the worst humanitarian crisis in the world.

As a result of the drone strike, both Brent crude and West Texas Intermediate oil prices spiked 14 percent. 

“Locked and Loaded”

Fanning the flames of war President Trump on Sunday stated the U.S. is “locked and loaded” as it awaits verification of who was behind the attack on the Saudi oil supply.  

“There is reason to believe that we know the culprit…but are waiting to hear from the Kingdom as to who they believe was the cause of this attack, and under what terms we would proceed!”, he tweeted.

U.S. Secretary of State Mike Pompeo made even more direct accusations stating that Iran was responsible for “an unprecedented attack on the world’s energy supply.” But like Trump provided no proof.

Iran dismissed the allegations as “meaningless,” not comprehensible” and “pointless.”

Blaming Iran without proof is part of the expanding U.S. war script.

Back in May and June when several oil tankers were sabotaged in the Persian Gulf, Washington, without providing a shred of evidence, claimed Iran was responsible. 

TREND TRACKING LESSON: Watch the words. Listen carefully. Don’t get sucked into the drama.

Locked and Loaded? 

Idiotic tough boy talk. 

And understand how they use language to manipulate.

Did Trump provide hard evidence that Iran was behind the drone strikes?

No.

Just a “reason to believe.” 

And who should we believe?

We are “waiting to hear from the Kingdom as to who they believe was the cause of this attack.”

The Kingdom?

“Believe” the murderous Saudi Gang that illegally invaded and has been destroying Yemen with the bombs and military intelligence supplied by the United States? 

And “believe” America’s esteemed Secretary of State Pompous Pompeo?

No evidence.  No specific facts.  Just unsubstantiated “beliefs.”  

And the mainstream media helped push this U.S. narrative along with hyperbolic headlines like the Times on Monday, “Saudi Oil Attack Photos Implicate Iran, U.S. Says.” 

Notice the word, “implicate,” which means to involve in an incriminating way.  Yet the photos proved nothing.  Not until the tenth paragraph of the story did the NY Times article state.

“The satellite photographs released on Sunday did not appear as clear cut as officials suggested, with some appearing to show damage on the western side of the facilities, not from the direction of Iran or Iraq.”

The Times article went on to say, “If Iran, or one of its proxies in Iraq or Yemen, carried out the attacks, it would fit into a strategy Iran has followed for months in its escalating confrontation with the Trump administration.”  

Again note the words used: “If” and “would fit into a strategy” which are conditional and based on thought up possibilities, not empirical evidence.

Iran has flatly denied the allegations that it launched the attack drones.

U.S. Ambassador to Saudi Arabia, John Abizaid, said Washington “strongly” condemned the attacks on the two facilities.

“These attacks against critical infrastructure endanger civilians, are unacceptable, and sooner or later will result in innocent lives being lost,”

Innocent lives being lost?  

Lost in the war of words between the U.S. and Iran is the world’s worst humanitarian disaster in Yemen where outside attacks from Saudi Arabia, backed by the U.S., has killed more than 100,000 people according to the Yemen Data Project. 

The First Shot

The civil war conflict in Yemen began in 2014, after the Houthis seized control of Sana’a, the capital. 

An Arab military coalition, led by Saudi Arabia and the United Arab Emirates, intervened in the war early in 2015, with the aim of defeating the Houthis who have been in Yemen for nearly 1000 years and restoring the puppet Yemeni government installed by the United States and had been more favorable towards the Saudis. 

In opposition to U.S. support of Saudi Arabia in the Yemen war, (in 1934, the new Kingdom of Saudi Arabia had attacked Yemen but could not defeat them), this past March the United States Senate passed a resolution to end US support of Saudi Arabia.

The bill was vetoed by President Trump and in May the Senate failed to override the veto. 

The Houthis did claim responsibility for the drone attacks on Saudi oil fields and more attacks would be coming and “more painful as long as its [Saudi] aggression and siege continue.”

TREND FORECAST: As we have been long warning, should the Middle East powder keg explode and send oil prices above $100 a barrel, equity markets and economies around the world will crash, igniting the Greatest Depression.

While oil prices had their sharpest spike in history, up some14 pecent following the Houthi attack on the Saudi oil fields, gold prices closed flat and the Dow sunk modestly, down 0.52 percent.

Cooling things down a bit, President Trump said, I don’t want war with anybody but we are prepared more than anybody … We have a lot of options but we are not looking at options right now.”
“That was a very large attack and it could be met with an attack many, many times larger very easily by our country, but we are going to find out who definitively did it first,” he added.

Iranian president Hassan Rouhani, said the attacks on Aramco were a “reciprocal response” by the Houthi’s in response to Saudi aggression against Yemen.

As I have long noted, the reason why the President Trump has not responded militarily against Iran following the oil field attack is the same reason he did not strike back following Iran’s downing of a hundred million dollar U.S. drone they claimed was flying over their territory: It would Pearl Harbor in the Straits of Hormuz.

Iran would blow the U.S. battle fleet patrolling those waters into oblivion.

Iran is not Afghanistan, Iraq, Libya, Syria, Yemen, etc.

It is an advanced society with advanced weaponry.

Thus, following the Houthi attack on Saudi oil fields, while the Presidential bluster is loudly blaring, negotiations behind the scenes may be in the works, thus easing market volatility

PUBLISHER’S NOTE: Society will continue to devolve unless there is an international push for peace.

On a high note, for example, a potential first step toward easing tensions between Moscow and Kiev took place as 70 prisoners, 35 on each side, were exchanged last week following weeks of negotiations. And, there are announcements that more prisoner exchanges will be coming in the weeks ahead.

President Putin said the exchange would be a step toward normalizing relations.

Indeed, “normalizing” relations becomes a monumental challenge with so many abnormal heads of state leading nations large and small.

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