Possibility of another Gulf war on the rise

With the amassing of naval firepower, armaments and troops – American troops are expected to reach the 100 000 mark by March – in the Persian Gulf region, the spectre of what is called a fourth Gulf war, is starting to take on an air of inevitability. If it does come to pass, few countries, including South Africa, will be left untouched. It is at the same time also fundamentally driven by economic considerations and by forging a global strategic realignment, changing the dictates of what can be regarded as being in the best national interest.

South Africa, like many other countries around the globe, is unlikely to escape some fallout from the drama building up  between Iran and America and its allies. This is dictated, among other things, by the fact that the country receives 25% of its crude oil from Iran.

Reports surfaced recently that South Africa is assessing a worst-case scenario in which its crude imports from Iran are cut by conflict or halted by the American-driven sanctions against that country.

South Africa is far from being the only country that will be affected by either the outbreak of hostilities in the Gulf or the unilateral enforcement of sanctions by the United States. While it could have dire consequences for the already economically depressed economies of southern Europe, only Turkey and Sri Lanka rely more on Iranian crude that South Africa.

In December last year, with apparent total disregard for the consequences it implies for a struggling global economy, the US congress imposed a mandatory sanctions package on the world starting in June this year. The US will have to sanction any third-country banks and companies dealing with Iran’s Central Bank – a move aimed at crippling Iran’s oil sales and its economy.

In the process America is sucking the rest of the globe into its economic war against Iran. For South Africa, the direct implications might go well beyond the fact that its refineries will not be able to switch overnight to crude oil from elsewhere – if it can be found overnight – for technical reasons. There will also be cost implications in adapting the refineries.

South Africa and Iran, however, also have other significant economic and investment links. South African-based telecoms company MTN, Africa’s biggest company in this industry, has 32-million Iranian subscribers accounting for 10% of its revenue. Petrochemicals giant Sasol has also previously announced it is to review its investment in Iran. In November 2011 Sasol announced that it has entered into preliminary talks for a possible divestiture of its share in the Arya polymer plant. The talks are ongoing and involve a number of business and government stakeholders.

Until recently Sasol Oil has procured a relatively small volume of Iranian crude oil, around 12 000 barrels per day. This volume represents roughly 20% of Sasol’s crude requirement for processing at its Natref refinery, said Jacqui O'Sullivan, the company's spokeswoman, who added that Sasol Oil is presently diversifying its crude oil sourcing to mitigate risks associated with oil supply disruptions from the Middle East.

Why is Iran the target?

With even the US intelligence community in its most recent National Intelligence Estimate (NIE) stating that Iran is not developing a nuclear weapon, very few serious commentators and observers any longer give credence to the pretext that Iran is being targeted because of being a nuclear threat.

Many commentators, however, make out a case that the real aim of the US is regime change in what has become the dominant state in the region with the Washington Post recently quoting an anonymous US-official as saying that “the goal of the US and other sanctions against Iran is regime collapse.”

The United State's attempt to take over Afghanistan and Iraq and establish client regimes did not go quite according to plan and a recent article on the Canadian-based website, Global Research said.

At the same time the extent to which the once mighty petro-dollar presently under threat, drives the US strategy around Iran should also not be underestimated.

Like Saddam Hussein before them, Iran’s leadership are attempting – and largely succeeding – to trade their oil without going through the normal channels. They are attempting to bypass the US and Europe by negotiating deals with China, India and Russia that will not require the trade of oil in dollars, but rather in yuan, rupees and gold.

In and article for Information Clearing House Pepe Escobar makes a strong case that “...perhaps one key reason the crisis in the Persian Gulf is mounting, involves this move to torpedo the petro-dollar as the all-purpose currency of exchange.”

Citing the recent pronouncement by US president, Obama that Washington’s focus of attention is to move to the Pacific, and thus China (with Iran happening to be right in the middle) he also writes that “... this larger-than-life psychodrama we call Iran may turn out to be as much about China and the US dollar as it is about the politics of the Persian Gulf or Iran’s nonexistent bomb.”

New global divides

As the present confrontation builds up to a crescendo, it is becoming increasingly clear that the reaction of some powerful global players are informed by what they regard as their own national interest.

It turns out that America will not find it easy to have it all its own way. About 75% of Iran’s oil exports go to resource-hungry countries in the East and South Asia, such as China, Japan, India and South Korea, all of whom have been unwilling to join the sanctions band-wagon.

Russia, also in a broader context including Syria, has not only given notice that it will veto any UN Security Council move towards intervention in Syria, but also warned that any military intervention in its neighbour Iran would be regarded as a threat to its own security. It also warned that a military assault on the Iranian regime could cause a chain reaction that would destabilise the entire world.

In America’s own backyard, many Latin American countries are increasingly forging links with Iran. Venezuela has joint projects to the tune of $4 billion with Iran ranging from banks to power plants.

Brazil, one of South Africa’s partners in the BRICS club (Brazil, Russia, India, China and South Africa) is completely opposed to the sanctions strategy, which  is also likely to  bring strain to bear on US/Japan relations, with Japan sourcing 10% of its oil needs from Iran.

As new dividing lines are developing in the world of global competition for strategic and economic dominance and under the pressure of individual countries’ own national interests, it is increasingly looking unlikely that economic pressure will deliver for the US the results it desires.

This makes the situation all the more dangerous. As Escobar reports: “... a senior EU official told National Iranian American Council president Trita Prasi, and as EU diplomats have assured me in no uncertain terms, they fear this [the sanctions] might prove to be the last step short of outright war.”

If it does come to conflict, as seems increasingly probable, the situation could become very uncomfortable and fraught with risks for a country like South Africa. In view of its own national interests, and the recent history in Libya, it would be a surprise if one were to find South Africa supportive of the cause of the US and its European allies.

Piet Coetzer