Events in Iran

21st Jun '09 by MrT

14 comments 8937 reads

Clearly, the unrest in Iran could have a major bearing on the global economy and therefore stockmarkets so I thought a thread was in order...

Fascinating NY Times writeup here: http://bit.ly/16IC2r.

Likewise, these Twitter feeds are extraordinary:

http://search.twitter.com/search?q=%23IranElection
http://twitter.com/oxfordgirl
http://search.twitter.com/search?q=%23neda - This is in honor of the young girl shot by the Baseej in yesterday's protests

Other than gaping in awe at the bravery of the Iranians, it's hard to know what the impact of these events could be and how to "play" them. The unrest is likely to have an impact on the oil price. It also highlights the inadequacy of traditional media: David Callaway claims Twitter is "jumping the shark" again (http://www.marketwatch.com/story/twitter-jumps-the-shark-again-in-tehran) but sounds like sour grapes to me. The fact is that Twitter is blowing away traditional media coverage of the event: http://technology.timesonline.co.uk/tol/news/tech_and_web/the_web/article6544276.ece

Buy oil, sell newspapers - pretty weak but am sure someone else can come up with something better than that...

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MrT

21st Jun '09

Anyone know which UK listed businesses do significant business with Iran, if any? According to this AEI link (http://www.aei.org/article/26695),

Firms that do the most business in Iran are French (Alcatel, BNP Paribas, Total), Italian (ENI), Korean (Hyundai), Chinese (PetroChina) and Russian (Statoil).

However, given that Statoil is Norwegian (http://en.wikipedia.org/wiki/Statoil), the information doesn't look very reliable and it doesn't mention any UK firms. Are they even allowed to operate there?

Shell appear to be in discussions there, although I guess it's tiny in the content of Shell overall: http://in.reuters.com/article/oilRpt/idINHAF93547220090609

The Persian LNG project concerns development of production and exports of liquefied natural gas from a part of the South Pars field in the Gulf. Repsol, Shell and state-run National Iranian Oil Company (NIOC) signed an initial deal in 2002 to develop Phase 13 of South Pars...

Repsol and Shell signed a service contract for the Persian LNG project in January 2007, setting out the conditions for exploration and development operations in Phases 13 and 14 of South Pars.... Last year, Shell delayed decisions on multi-billion dollar investments in Iranian LNG plans due to political tension

emptyend

In reply to MrT (post #1)

Very few UK businesses are actually active in Iran at this point, AFAIAA. Various major oil companies have been in discussions but in general thats as far as its got before the Asian NOCs sign up and do the deals.

Can't think the UK cause will be advanced in the near term by the Supreme Leader's comments yesterday suggesting that the UK was "the worst".

alano20

In reply to emptyend (post #3)

Comments I read suggest this is to keep the door to Obama open: "Look we even changed the standard anti-USA script for you".

Betasurfer

As an aside, I didn't find this 100% convincing but I thought it was an interesting analytical attempt to figure out whether the results were a sham:

The Devil Is in the Digits: http://www.washingtonpost.com/wp-dyn/content/article/2009/06/20/AR2009062000004.html?referrer=reddit

We used the results released by the Ministry of the Interior and published on the web site of Press TV, a news channel funded by Iran's government. The ministry provided data for 29 provinces, and we examined the number of votes each of the four main candidates -- Ahmadinejad, Mousavi, Karroubi and Mohsen Rezai -- is reported to have received in each of the provinces -- a total of 116 numbers.... The numbers look suspicious. We find too many 7s and not enough 5s in the last digit. We expect each digit (0, 1, 2, and so on) to appear at the end of 10 percent of the vote counts. But in Iran's provincial results, the digit 7 appears 17 percent of the time, and only 4 percent of the results end in the number 5. Two such departures from the average -- a spike of 17 percent or more in one digit and a drop to 4 percent or less in another -- are extremely unlikely. Fewer than four in a hundred non-fraudulent elections would produce such numbers. As a point of comparison, we can analyze the state-by-state vote counts for John McCain and Barack Obama in last year's U.S. presidential election. The frequencies of last digits in these election returns never rise above 14 percent or fall below 6 percent, a pattern we would expect to see in seventy out of a hundred fair elections".

Gradders73

My view is this is further evidence of the damage done to the democratic process by the stolen US election in 2004. Since then, leaders around the world have been willing to show 2 fingers to the world.

Clearly Khamenei is terrified this will bring down the whole Islamic revolution, but the frustrations of the young have been building for so long and won't go away, no matter how much opiates the rules try to give them.

At least it won't effect those companies taking Iranian oil from the offshore rigs in the Persian Gulf -

http://www.youtube.com/watch?v=B35rYEkYgvs&feature=related

Apologies as this is not investment focused clearly, but it's a fascinating insight. The latest speech from Moussavi translated into English. His reply to Khamenei's speech on Friday: http://different-ways.co.cc/?p=332

As I look at the scene, I see that it has been set to achieve more than just forcing an unwanted government on the nation, it is set to achieve a new type of political life in the country. As a companion who has seen the beauty of your green wave of participation, I will never allow anybody’s life to be endangered because of my actions. At the same time, I stand by my firm belief of this election being null and void, and insist on reclaiming people’s rights, and in spite of the little power I possess, I believe that your motivation and creativity can still result in following up your legitimate rights in new and civil guises. Be confident that I will stand by your side at all times. What this brother of yours advises for finding these new solutions, especially to the beloved youth, is: Don’t let the liars and fraudsters steal the flag of defending the Islamic regime from you; Don’t let “the delinquents and the strangers” [quote from Ayatollah Khomeini, quotation marks ours] confiscate from you the precious heritage of the Islamic Revolution, which is built from the blood of your honest fathers. With trust in God and hope for the future and relying on your capabilities, continue your social movements based on freedoms explicitly stated in the constitution and stay away from violence, as you have been doing. In this road, we are not up against the Basij members; Basiji’s are our brothers. In this road, we are not up against the Revolutionary Guard members; they are protectors of our Revolution and regime. We are not up against the military; they are the protectors of our [country's] borders. We are not up against our sacred regime and its legal structures; this structure guards our Independence, Freedom, and Islamic Republic. We are up against the deviations and deceptions and we want to reform them; a reformation that returns us to the pure principles of the Islamic Revolution.

p.s. I take your point, EmptyEnd - of course, if the regime changes, perhaps Britain will be very well placed but that's still extremely unlikely to happen, I accept.

rpcroft

The BBC's Persian service is very popular in Iran and is presumably at the root of the Ayatollah's comments about Britain.

This is Tehran today:

http://www.bbc.co.uk/persian/iran/2009/06/090621_ag_street_clashes.shtml

This from Chatham House has some interesting points, such as pointing out that 2 provinces had turnout of over 100%.

http://www.chathamhouse.org.uk/files/14234_iranelection0609.pdf

doverbeach

And this http://www.washingtonpost.com/wp-dyn/content/article/2009/06/20/AR2009062000004.html

Each of these two tests provides strong evidence that the numbers released by Iran's Ministry of the Interior were manipulated. But taken together, they leave very little room for reasonable doubt. The probability that a fair election would produce both too few non-adjacent digits and the suspicious deviations in last-digit frequencies described earlier is less than .005. In other words, a bet that the numbers are clean is a one in two-hundred long shot.

4th Aug '09

The Green Brief is a great source of realtime info on events in Iran -

http://iran.whyweprotest.net/green-brief/25468-green-brief-47-august-2-3-a.html

13th Aug '10

Well, I could kind of understand the rationale of Israel attacking if it was thought that such an attack would cause the population to revolt and overthrow the regime. The thing to note is that the nucleur programme in Iran is not just the crazy dream of the President and the Revolutionary Guard. It's actually very widely supported by the population at large - they think that Iran has the right to develop nucleur technology and that it's hypocritical for the US and Israel to try to prevent this.

"The Iranian side of the discourse is that they want to be known and seen as a modern, developing state with a modern, developing industrial base. The history of relations between Iran and the West for the last hundred years has included Iran's developing various kinds of industrial and technological advances to prove to themselves—and to attempt to prove to the world—that they are, in fact, that kind of country." (William Beeman)

Some interesting links:

I just can't see a way for a military strike to completely disable Iran's capacity to develop nucleur weapons. It might set them back a matter of months but they have been anticipating an attack for years, so the capability will be well-spread throughout the country. We only recently found out about a second enrichment faciliity at Fordo - the one that's carved into a mountain and built for maximum protection from aerial attack! Who knows what else there is...

Unless Israel are planning to occupy the country, fight a long arduous ground war and systematically identify and destroy all possible nucleur sites, a military strike takes them virtually nowhere, in my view. Unfortunately, the only option (as abhorrent as it may seem) is to engage with Iran as a partner, give them the recognition they want on the world stage, and make them feel less paranoid about the intentions of the world at large. The Iranians desperately crave legitimacy and acceptance. It's taking a gamble that the leadership won't strike first - but the same gamble was taken by the US with the USSR during the Cold War... because there was no other viable option! We have to use "the carrot" rather than the "stick" because the "stick" leads to an inevitable nucleur conflict, IMO.

For all Ahmadinejad's fiery rhetoric and unpleasant commments, as this CBS interview shows, he is actually very articulate. See this CBS interview from 2007 where he wipes the floor with the questioner:

http://www.cbsnews.com/stories/2007/09/21/60minutes/main3286690.shtml

PELLEY: But the American people, sir, believe that your country is a terrorist nation, exporting terrorism in the world. You must have known that visiting the World Trade Center site would infuriate many Americans, as if to be mocking the American people.

AHMADINEJAD: Well, I'm amazed. How can you speak for the whole of the American nation?

PELLEY: Well, the American nation . . .

AHMADINEJAD: . . . you are representing a media and you're a reporter. The American nation is made up of 300 million people. There are different points of view over there. I would like to think that the points of view of the American people is very close to the points of view of the Iranian people. The American people are very much against and opposed what certain American officials are saying and their points of view. And they're also, the way that the people have voted in the American elections is very telling. And we are criticizing such behavior on the part of the American government. We believe that if anyone just allows himself to accuse others, there will be no possibility for peace and friendship.

One would imagine from this exchange that he is smart enough to understand the concept of 'Mutual Assured Destruction'....

It's a terrifying situations with no easy answer, that's for sure!

omh

It's actually very widely supported by the population at large - they think that Iran has the right to develop nucleur technology and that it's hypocritical for the US and Israel to try to prevent this.

I, for one. completely agree with the Iranians. How much more hypocritical can you get than to say that it is OK for us to have something but that you cannot.

Going back to the previous thread, if Iran genuinely believe that Israel plan to attack in Q1 next year, then would they not be perfectly justified in using the US Administration's justification of invading Iraq (They are planning to attack us, so we are justified in geting our revenge in first) as an acceptable reason for attacking Israel?

OMH

Hallucigenia

14th Aug '10

MrT - beware the argument from personal disbelief. It doesn't matter if an attack would delay Iran's nuclear progress by a few months. Regardless of the fact that we don't know if that's true or not. It certainly seems that they would be hard-pressed to replace things like centrifuges under current conditions, with the Chinese and Russians no longer playing ball. I don't really have an opinion one way or another, other than to make the point that a nuclear supply chain is complicated and needs a lot of different things to work, in order to get a bomb out the other end. So a nuclear supply chain has a lot of failure nodes. Certainly the attacks on Iraq and Syria were successful in stopping the supply chain in those countries.

But it doesn't matter. All that matters is that the Israelis clearly think that they _could_ make a significant difference with an attack. Or at least, that's the impression they want us to have.

As for MAD - reread Goldberg's article, in particular the quote from Rafsanjani : “The use of an atomic bomb against Israel would destroy Israel completely while [a nuclear attack] against the Islamic countries would only cause damages”. 1500m Muslims versus 6m Jews - would Iran take one for the team?

Even if they didn't want to sacrifice Persian civilisation to Allah, the article outlines lots of ways in which possession of nuclear weapons shifts things significantly in Iran's favour. Never mind the effects on Israel, it would have a big effect on the oil price and on the UK economy. We just can't afford to be bleeding hearts on this issue, the world economy doesn't have the luxury of allowing a nuclear arms race in the Middle East. And no - I'm not a great fan of Israel having them either.

As for an Iranian first strike, if we believe the Western intelligence view of where they'll be, then they won't be first-striking with a thermonuclear bomb until next summer at the earliest. They could use a dirty bomb, but not a big bang. And any planes wouldn't get past the Saudis and USAF-in-Iraq, so they'd be limited to however many ballistic missiles they have, and Israel does have some ABM capability. On the flip side, even a dirty bomb delivered by ballistic missile would probably justify Israeli sending in the Jerichos.

Getting back to more practical matters, it does feel like I should be picking up some way out-of-the-money options on oil, and perhaps investigating LEAPS or something to short the Israeli stock market....

Events in Iran

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MrT

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