Turns out simple diplomacy, not military intervention, may actually work after all.
According to an article published on CNN.com, diplomatic tactics imposed by Western nations on Iran due to its expanding nuclear program have begun to hurt Iran’s oil industry. It seems Western financiers have become less willing to invest in Iran’s oil infrastructure out of fear of further sanctions against the country.
This can be seen as both good and bad news for the rest of the world. The good news is that the diplomatic tactics appear to be working and may force Iran’s hand regarding its nuclear program, especially considering oil and gasoline makes up such a large portion of Iran’s revenues.
Unfortunately, if Iran chooses to continue with its nuclear program and Iran’s oil production suffers, the byproduct will be much higher worldwide oil and gasoline prices. Considering Iran is the world’s fourth largest producer of oil, if their oil industry suffers the world’s oil industry suffers.
If Iran’s oil production were to suffer and gas prices were to spike, it wouldn’t be the first time the country played a large part in rising gas prices. Back in the 1970′s Iran was behind several oil production cuts (in cooperation with other OPEC members) that drove oil prices upwards and put the world economy in a decade long recession.
Fortunately, at this point it appears that strict sanctions are unlikely to be imposed by the United Nations, so it doesn’t look like Iran’s oil industry will suffer much beyond the slight reduction in financing it’s currently experiencing.
However, if Iran steps up its efforts to build its nuclear capabilities or becomes militant and defiant, things could get very interesting… and expensive.
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If it turns out that Iran is developing nuclear technologies to improve their infrastructure, it will be the American people who look like idiots. And they are.