The election of Democrat Barack Obama has managed to calm the wary nerves of those who feared the idea of an expanded worldwide war. There is a sense of calm on that front and an entirely new focus on the devastating economic crisis of today. Even investors in the crude oil (OIL) market are, for now, sitting back and taking a breath, perhaps caught up in the wonder of America's first African American president as they also stand shell-shocked by job losses and miserable economic data.
But alas, that calm that was to be a peace during Obama's administration may by a complete myth. In fact, the myth could even be over in days. Quietly on the other side of the planet, an Israeli electorate is supporting a right-wing leader by the name of Benjamin Netanyahu. On February 10th, Mr. Netanyahu is expected to become the new Prime Minister of Israel and few have carefully considered the implications.
Or perhaps few want to consider the implications, knee deep in a financial malaise and reveling in the new leader of the free world. But could "hope" and "change" end up being the same false promise of a one, George W. Bush? Mr. Bush faced an immediate crisis less than a year into office and everything, indeed, "changed". Now we have a Mr. Obama - President Obama - whose first foreign policy decision was to stay silent while the Israeli government attacked an enemy.
That kind of silence could become deafening. Israel's assault on members of the extremist political party Hamas managed to kill more civilians than state enemies. Benjamin Netanyahu, a leading advocate of the assault, has said he believes that Iran is a greater concern than the global economy. The world - including the world oil markets - ought to pay close attention. Mr. Netanyahu stated "It’s 1938, and Iran is Germany, and Iran is racing to arm itself with atomic bombs.”
Regardless of how one might feel about these statements, it is time to put two and two together. In the face of worldwide condemnation, Israel's right wing leadership decided to relentlessly attack Hamas and regarded the hundreds of civilian deaths as an unfortunate side effect that could not be avoided. The question is, why should anybody expect anything different with the Iranian issue. Could our economy become the unfortunate side effect of right wing leaders in the Middle East?
Yes, an attack on Iranian nuclear sites by Israel could prompt a massive disruption in the oil markets, causing crude oil prices to soar during a vulnerable time in the American economy. Indeed, the issue is even multiplied by the fact that the world may be facing a peak oil situation, where oil production has no more room to grow. This could be the final trigger that sends the world economy into a panic, as it may test Saudi Arabia, in particular to make up for production disruptions that would likely occur from Iran.
The world may groan, but Israel's right wing leaders are steadfast. One anti-war activist by the name of Norman Soloman has labeled the new situation of having a Netanyahu across from Iran's president, Mahmoud Ahmadinejad, the "Axis of Fanatics." Indeed, these are two individuals who are clearly less concerned about the world's economic situation and more concerned with wiping each other off the map. That's a dangerous recipe in this particular environment. Soaring oil could break more than the camel's back. Soaring oil at this point can change the world forever.
