"Iran has moved ballistic missiles into launch positions," according to the London Sunday Times,
The movement of Shahab-3B missiles, which have an estimated range of more than 1,250 miles, followed a large-scale exercise earlier this month in which the Israeli air force flew en masse over the Mediterranean in an apparent rehearsal for a threatened attack on Iran’s nuclear installations.
The launch stations are positioned for a strike on Israel.
Islamic Revolution Guards Corps (IRGC) Commander Major General Mohammad-Ali Jafari cautioned, during an interview Saturday, on Iranian television that:
"Israel is located entirely within the reach of our missiles. Our missile power is such that the Zionist regime, despite all its capabilities, would not be able to confront us."
Jafari went on to state that, in the event of attack, Iran could not choose to do otherwise than
to cut off oil flow from the region. "When a country comes under attack, it naturally uses all its capacities to confront the enemy," said the Iranian General, in reference to cutting of the flow of oil through the Straits of Hormuz. He spoke openly of the deterence provided by the prospect of dramatic increases in the price of oil.
In an interview with Fox News, on Sunday, former Ambassador to the United Nations, John Bolton, averred that...
"Iran needs to sell its oil on the international market in order to have an economy. So the notion that it would block off everything would have catastrophic results for Iran, as well."
Iran, however, sells no oil to the United States or Israel, and it customers (particularly China) are unlikely to work vigorously to demand that the Strait be reopened to any traffic but their own.
Bolton’s comments on the inevitability and timing of the expected Israeli attack are more cogent, however:
"They want support, I think, at least after the fact, from the United States, and, therefore, I think, doing it during President Bush’s term makes a lot of sense. I don’t think they’ll do it before our election because you can’t calculate what the impact would be. Of course, after the election they’ll know who will be President and that would factor into their decision, as well. But I think all of this points to a narrowing of the time table within which Israel has to make a decision."
The U. S. Presidential candidates are sure, for this reason, to be grilled over the weeks to come upon their position vis-a-vis an Israeli attack. The permutations that are possible in the months to come could easily make today’s viable position into tomorrow’s policy albatross.
What is all but certain is that the price of month-out oil futures will rise substantially tomorrow. In the initial salvos, Iran has won going away. Israel’s military maneuvers and public pronouncements caused oil to begin to rise again, after a brief sell-off, setting new records as of Friday. Iran’s threats, today, to close the Straits of Hormuz will push up oil prices still further. Futures contracts for November 2008 to early 2009 (not generally quoted in the popular financial reports) may begin to go up by even greater percentages than the month-out price thus cutting off the possibility of lower fuel prices for many months into the future.
For the present, at least, Iran’s leadership has greatly enhanced its economy and they know it. Closing the Straits of Hormuz may not be nearly so daunting, economically, as Bolton suggests.
While the U.S. government has some sense of the "weaponization of oil" by smaller states that it easily overmatches in military strength, it and its allies have yet to develop a defense against it. Iran has clearly won the first round of this potentially crippling confrontation. It is likely that they will be attritioning the U.S. pocketbook for some time to come.