- The global community must be feeling extremely cagey worrying about the repercussions of the escalation in the West Asia war front after Israel targeted Iran-backed Hezbollah in Lebanon. The subsequent retort from Iran on Israel is bound to evoke a response from Tel Aviv which only goes to signify where the situation in the region is headed much to the chagrin of all concerned. The Israel-Hamas conflict that started last year has gradually spread to other areas of the region making the world leadership sit up and stare at a possible catastrophe of humongous proportions. The Israeli PM is apparently in no mood to buckle up from pressing ahead with the agenda of unleashing a lesson on the perpetrators despite the monumental loss of lives and property.
PC: India Today
- However, the escalation forecast in the region will be of bigger concern for the universe if the conflicts suck in different players aligning with the warring factions leading to an unprecedented situation. Did someone say akin to a third world war? Unlikely but you never know how the situation may simply slip out of saner control. This is where the US must step in now to stop Israel from going any further, especially targeting Iranian oil fields. Such a move will be disastrous for the entire world. As mentioned above, with Iran’s missile attack on Israel last week, there’s little doubt Tel Aviv will retaliate. While the US has ruled out Israel striking Iran’s nuclear facilities, there’s now talk of a hit on Iranian oil-producing infra. That would be disastrous in a different way.
- Washington must do everything in its power to restrain Tel Aviv from targeting Iranian oil. Make no mistake, hitting Iranian oil infra would be a huge escalation. For, Iran may choose to retaliate by targeting oil shipments from the Persian Gulf. That itself could drag countries like the UAE and Saudi Arabia into the conflict. Plus, Iran, despite sanctions, pumps out about 2mn barrels of crude a day, or 2% of global supply. A hit on this production will see crude prices jump, given that oil trade is driven by global market dynamics. Note that Brent crude has already crossed $78 a barrel from $71 a barrel before Iran’s missile attack. Thus, countries like India that rely on oil and gas imports from the Gulf will suffer if Iran disrupts this route.
PC: RFE/RL
- Also, oil is traded on forward contracts. These will go for a toss in case of a wider war. The knock-on effects for these economies will be considerable. Additionally, India has a huge diaspora in Gulf Arab states. A wider regional conflict may necessitate emergency evacuation. Indications show that the US has been unable or unwilling to rein in Netanyahu despite domestic pressure to indulge the belligerent PM to see the disastrous consequences of continued war. There are now reports that Hezbollah and Israel had agreed to a US-France ceasefire before Nasrallah was killed. If that’s true, Biden can be accused of being a lame-duck President. That’s certainly not the legacy he wants. Netanyahu should be reined before any major damage occurs. The US must act now.
