Iran stops oil sales to British and French firms

Iran stops oil sales to British and French firms

Strap on your day trader hats, all you commodity junkies, crude is about to hit the roof with this news. The summer is going to be a boondoggle for the white house. And, Obama will more than likely lose the presidency over this.

Tehran, Iran

TEHRAN (Reuters) – Iran has stopped selling crude to British and French companies, the oil ministry said on Sunday, in a retaliatory measure against fresh EU sanctions on the Islamic state’s lifeblood, oil.

“Exporting crude to British and French companies has been stopped … we will sell our oil to new customers,” spokesman Alireza Nikzad was quoted as saying by the Ministry of Petroleum website.

The European Union in January decided to stop importing crude from Iran from July 1 over its disputed nuclear program, which the West says is aimed at building bombs. Iran denies this.

Iran’s oil minister said on February 4 that the Islamic state would cut its oil exports to “some” European countries.

Iran Stops Oil Sales to Britain and France

The European Commission said last week that the bloc would not be short of oil if Iran stopped crude exports, as they have enough in stock to meet their needs for around 120 days.

Industry sources told Reuters on February 16 that Iran’s top oil buyers in Europe were making substantial cuts in supply months in advance of European Union sanctions, reducing flows to the continent in March by more than a third – or over 300,000 barrels daily.

France’s Total has already stopped buying Iran’s crude, which is subject to fresh EU embargoes. Market sources said Royal Dutch Shell has scaled back sharply. Shell had no comment on the announcement.

Among European nations, debt-ridden Greece is most exposed to Iranian oil disruption.

Motor Oil Hellas of Greece was thought to have cut out Iranian crude altogether and compatriot Hellenic Petroleum along with Spain’s Cepsa and Repsol were curbing imports from Iran.

Iran was supplying more than 700,000 barrels per day (bpd) to the EU plus Turkey in 2011, industry sources said.

By the start of this year imports had sunk to about 650,000 bpd as some customers cut back in anticipation of an EU ban.

President Mahmoud Admadinejad of Iran

Saudi Arabia says it is prepared to supply extra oil either by topping up existing term contracts or by making rare spot market sales. Iran has criticized Riyadh for the offer.

Iran said the cut will have no impact on its crude sales, warning that any sanctions on its oil will raise international crude prices.

Brent crude oil prices were up $1 a barrel to $118.35 shortly after Iran’s state media announced last week that Tehran had cut oil exports to six European states. The report was denied shortly afterwards by Iranian officials.

“We have our own customers … The replacements for these companies have been considered by Iran,” Nikzad said.

EU’s new sanctions includes a range of extra restrictions on Iran that went well beyond U.N. sanctions agreed last month and included a ban on dealing with Iranian banks and insurance companies and steps to prevent investment in Tehran’s lucrative oil and gas sector, including refining.

The mounting sanctions are aimed at putting financial pressure on the world’s fifth largest crude oil exporter, which has little refining capacity and has to import about 40 percent of its gasoline needs for its domestic consumption.

(Writing by Parisa Hafezi; Editing by David Cowell)

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Dollar Weakness Could Spark a Mass of Dumping

U.K. Announces Dumping of Dollar as a Snub

“The US dollar appears to be entering a long-awaited devaluation period to compensate for global imbalances. But this is also likely to spark a significant sell-off of US equities and bonds because many investors will not want to hold assets valued in a currency that is in decline.” – 2006

The Australian Central Bank raised its interest rates yesterday, which sparked a strengthening of many currencies versus the dollar. If there is no response from the Federal Reserve Bank, many will simply start dumping the dollars. OPEC for one, cannot continue to hold dollars as the reserve currency if there is no way to make use of them, i.e. U.S. products. Parking dollars in financial securities only goes so far. There is a rising trend with OPEC nations to purchase foreign goods instead of American goods.

Due to the lack of our infrastructure for a strong manufacturing sector, the dollar as a reserve currency days are numbered. We no longer are a mass producer of goods as we were in the 60’s and before. Without these goods, in which to use dollars, there is nothing to do with the dollar. A weak dollar then becomes not a commodity for the U.S., but an inherent weakness, which will lead to its own collapse. This is why the world is waiting for a response from the Federal Reserve Bank. If the sign they get from the Bank is that they are continuing with this trend of devaluing the dollar, then get ready for a domino effect: sell off of U.S. notes and securities; foreign currency strengthening versus the dollar; dumping of the dollar.

The Federal Reserve Bank is in a catch 22 however. On the one hand they don’t want to continue along the same path of providing too much liquidity for fear of hyperinflation, coupled with a weak dollar. On the other hand, they think the only way to combat inflation is to pump more money into the economy to remove the unemployment factor in the GDP. Raising interest rates of course would be the logical thing to do. However, the Federal Reserve Bank is under tremendous pressure to not just profit from the U.S. economy’s own problems, but to give into pressure to continue subsidizing the government and their socialistic monetary promises.

“Let them eat cake.”

I’m sure the Bank would like nothing better than to call in all the loans it made during the bailouts, raise interest rates, and just sit back and rake in the money. I’m sure the Fed would like to call in its loans worldwide that it made during the “economic” crisis and just sit back and rake in the money. Politicians would not want them to do that. They want to get reelected, so want the economy to “appear” to be strengthening, so they want the money to keep flowing from the Bank. Instead of fixing the 25% unemployment rate, through sound fiscal policy and a sound interest rate, to take the country back into a buckle-down status, they want to ignore the problem and just spend spend spend.

Investors are seeing the error of their ways. A weak dollar is causing stock prices to rise. At first, the uneducated investors thought it was a strengthening of the market, but even the obtuse are finally seeing the writing on the wall. Gold and silver are the obvious beneficiaries of this. Too long has gold prices been suppressed. With such a massive influx of investment from all sorts of traders, gold is set to see new highs. Gold is the only obvious choice to park your dollars in this economy. Once again, stocks are seen as a too risky venture.

Enter the Carry Trade

Before the carry trade was the Yen and the Swiss Franc. Now, the trend is the U.S. dollar as the carry trade currency. This is not a good thing. While one might think that everyone will be purchasing dollars for the carry trade, the reasoning behind it, is to purchase foreign financial securities, or foreign goods, or foreign businesses and trade. The dollar won’t be the impetus for financing the trade, it will simply be in the trade due to its low yield and lack of interest rate, i.e. a o% interest rate means, those borrowing in dollars will not need to pay back any interest. So slowly investors will be siphoning off trade away from the united states due to the low interest rates and the carry trade.

Will the Bank do anything to stop this? Will the Bank raise interest rates? Will the bank care that we are steadily losing global market share in goods, services, manufacturing and commodities? The answer is obvious: No. The Bank no more cares about the dollar as a carry trade than they do about a 25% unemployment rate. In fact, their response has been and continues to be, more devaluation of the dollar.

Before, manufacturers wanted a weak dollar so that their goods could compete with foreign goods. However, they are realizing their mistake now. People are still buying foreign goods, because now, American goods are too cheap: cheaply made; cheaply priced.

Now foreign nations are turning towards a policy of strong economies to safeguard against the fiasco we are going through. The Yen is no longer a carry trade currency and the current government has expressed a complete change in policy. They are heading towards a strong Yen. This is a complete reversal from their 1990’s policy. The irony is that in the 1990’s we advised them not to prop up zombie banks and corporations through stimulus. They didn’t listen and prolonged their own recession for a decade. Now the shoe is on the other foot and they are announcing a policy of a strong economy and strong Yen, no more propping up zombie banks.

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Who’s Behind the Energy Crisis: The Real Story

There is No Energy Crisis

We’ve been told for over 40 years now that there is an energy crisis. From the start of the 70’s up to today you’ve been had. You’ve been took. You’ve been hoodwinked, bamboozled, led astray, run amok. How could it be that the most powerful country on the planet, that has its own oil fields, several hundred thousand capped mind you, is at the mercy of others to provide the essential oil we so desperately need?

The simple fact is: we are not at the mercy of foreign powers. The simple fact is: we do not need anyone else’s oil. For some of you this revelation is hard to swallow. In your mind, you know all the issues. In your mind you know all the players. In your mind you know all the motives. I mean, they’re out to make money and sell oil right? So you reason to yourself. Surely there could not be some ulterior, sinister motive other than to sell oil.

Let’s return to the 70’s for a brief history look. Who was the “enemy” at that time? The… communist Russians, right? Yes, that’s correct. We were told that the Russians were desperately out to get us. Oh and the Russians would bomb us and wipe us out at any opportunity that they possibly could. Let’s back up only 20 years earlier. Who were the Russians then? Why, they were our staunchest allies. In fact, without them and us, together arm in arm, the world would be a very very different place. We defeated Hitler scant years earlier. So what difference does 20 no sorry, 10 years make, because they were allegedly our enemies in the 60’s actually.

The Russians did not change. They did not change at all. In fact, quite a few presidents went over to visit the Russians. You don’t have, as a foreign policy protocol, the highest office visit a known enemy and an identified threat to our national security. So, could it be that these Russians were not our enemies at all? Yes. We were being brainwashed. And, when the damn broke Washington was caught with its pants down. Suddenly Reagan was being repainted as a hero, instead of leading the charge against our enemy the Russians. The fact was, that Russia was crumbling some 20 years before Reagan even took office.

Who was the next enemy? Terrorists! We started getting reports about terrorist plots and terrorist threats. One simple fact escaped the America public however, there had never been, and never will a terrorist attack on U.S. soil. If you can read, you realize what I just wrote. If you don’t believe it, go look it up in the F.B.I. files, and the C.I.A. files. There has never been a terrorist attack on U.S. soil, and no terrorist is wanted for questioning for any attack on U.S. soil. Even Ben Laden is not wanted for any attack on U.S. soil. So obviously this terrorist scheme as an enemy is winding down and wearing thin. So we have already moved on to the next “enemy”.

That next enemy is already here. Rogue States! That is to say, those countries, yes plural, that pose a threat to U.S. security. This one is harder than the terrorist scheme to sell to the American public, because we really can’t see the evidence of these “rogue states”. There are no other countries, other than Columbia and its drugs, that directly impacts the U.S. to any degree of direct threat or certainty. Bush tried his best with his “axis of evil” speech to deliver the message of “rogue states.” But, he was a bumbling fool, no offense intended. He was oratorically challenged and could not sell ice water to an African Bushman in the Gobi Desert. We have yet to see if Obama is going to continue the charade.

Well what does all this have to do with oil and there not being an energy crisis? Simple. What if I told you this plot to have an “enemy” was concocted 40 years ago. And, that each “enemy” was listed back then. I have it on great authority that this is the case. [sources include state department officials, cabinet members, U.S. military generals, former astronauts, former information community agents] The final enemy I will not speak of due to how strange it sounds. [bookmark this page and return to it in about 5 years and you’ll realize how truthful this article is] I would prefer not to be harassed nor made the scape goat of a community I am not a part of. [the intelligence community]

With this scheme of directing our attention to an “enemy” at all times, the real plan was also hatched. A few key players would call the shots in the U.S., and actually the world, for all the energy resources.

What would happen if it were found out that there exist an energy resource and has been around for 40 years, that would make the combustion engine, as we know it, obsolete. How upset would you be, to find out that the thousands of dollars you have spent at the gas station personally, could have all been avoided. I have watched interviews with Arabian princes, and Sheiks who have hinted at it. One even said:

“there is no reason oil should be thrown away on a car to begin with.”

Why would a member of OPEC say that? Is there something he knows that we do not? Could he be hinting at a technology that existed already that would make use of gasoline for an engine to be unnecessary? Another member was interviewed and said:

“I don’t like to sell gasoline to Americans. I would prefer they not use gas at all, they are just throwing it away. I would prefer they use it for something else.”

Clearly these two are on to something. They were hinting at something that the rest of us are in the dark about. What other use, than gasoline for a car, could oil be used for? Or, let me put that question another way. If not gasoline, what other energy source could we use to replace oil, and use oil for common products instead, which do not waste nearly 1/10th as much oil as gasoline does? These two statements are more confirmation about an alternative resource being out there, other than oil.

So, why the charade? Money of course. And, it’s going to get worse. As oil gets more and more scarce, OPEC and other “rogue states” which have oil, are going to tighten up and sell less and less oil, so as to preserve their holdings. You can expect sharp spikes in the price of oil in as quickly as a year. And, when I say a sharp spike in oil prices, I mean the current highs will not compare to the drastic price increases in the near future.

Occasionally the president has gone over the OPEC to slap them around and keep them calm. But, the president can’t keep a hold on the lid, when oil reserves are decreasing. It is a reality and no amount of evil schemes are 40 year old plans can stop it. If Obama is a good old boy, he’ll be going over there to slap them around and get them to keep playing along with the farce as well. However, I wouldn’t hold my breath. If the wells are running dry, no amount of slapping around can help the situation.

I don’t think the Saudis will spill the beans publicly, but I do expect they will tighten their belts and ignore anything this president or any other president from foreign countries have to say. Remember this is a global issue.

The foreign governments, that are in the “know”, are keeping quiet, which includes the OPEC countries. However, the OPEC countries have a duty to their own nations first. While they might not spill the beans, since they are getting rich off the scheme, they will have to lessen oil exports if not stop them completely.

Have you ever wondered why we cap our own wells and import foreign oil? And, it’s not a matter of lack of oil refineries here, nor prohibitive costs of opening the wells, nor the prohibitive cost of drilling new sites. The reason is, this scheme is so good, they don’t have to drill another drop here. They are making money hand over fist off of the ignorance of the common American citizen, and citizens around the world really.

If you trade, I recommend you get into oil and hold, find a good entry point now, and buy buy buy.

For those interested in more research on the subject, look up: NRO National Reconaissance Organization; ACIO; SDI strategic defense initiative; Sibel Edmonds.

[nothing here should be construed as broker advice]

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