Choke point: volatile events in the Middle East a global economic and military powder keg awaiting a spark

December 13, 2011 – JORDAN – As the U.S. completes its final withdrawal from Iraq, American Special Forces troops have been diverted to positions in Jordan opposite a Syrian tank concentration building up across the kingdom’s northern border, debkafile’s military and intelligence sources report. As of last Thursday, as of last Thursday Dec. 8, military convoys, air transports and helicopters have been lifting U.S. troops across the border from Iraq. They have been deployed in position to ward off a possible Syrian invasion in the light of President Bashar Assad’s warning that he would set the entire Middle East on fire if the pressure on his regime to step down persisted. Syria’s other neighbors have taken precautions against this contingency but this is the first time U.S. boots have hit the ground directly opposite Assad’s army. The incoming U.S. contingents are disclosed by our sources as having been housed at the King Hussein Air Base of al-Mafraq, 10 kilometers from the Syrian border. U.S. troops were sighted Monday, Dec. 12, building surveillance towers and army posts in the Jordanian villages of Albaej, Zubaydiah and al-Nahdah al-Houshah as well as near the Sarham dam of the Yarmoukh River which runs down the international border between Syria and Jordan. Three months ago, the Syrian ruler cautioned Jordan’s King Abdullah II to stop granting asylum to Syrian military deserters and allowing his country to serve as a conduit for pumping arms to the opposition. The king was not deterred by this threat. Seen from Damascus, Jordan would be easier to take on militarily that either Turkey or Israel. Saturday, Dec. 12, Jordanian surveillance units confirmed that Syrian armored units were gathering opposite the Jordanian town of Bura Al Hariri. Iraqi sources report that the American units came from the big Iraqi Ain al-Assad air base in the western province of Al Anbar opposite the Jordanian border. –Debka

Iranian exercise in Strait of Hormuz: A member of the Iranian parliament’s National Security Committee said on Monday that the military was set to practice its ability to close the Gulf to shipping at the narrow Strait of Hormuz, the most important oil transit channel in the world, but there was no official confirmation. The legislator, Parviz Sarvari, told the student news agency ISNA: “Soon we will hold a military maneuver on how to close the Strait of Hormuz. If the world wants to make the region insecure, we will make the world insecure.” Contacted by Reuters, a spokesman for the Iranian military declined to comment. Iran’s energy minister told Al Jazeera television last month that Tehran could use oil as a political tool in the event of any future conflict over its nuclear program. Tension over the program has increased since the International Atomic Energy Agency (IAEA) reported on Nov. 8 that Tehran appears to have worked on designing a nuclear bomb and may still be pursuing research to that end. Iran strongly denies this and says it is developing nuclear energy for peaceful purposes. Iran has warned it will respond to any attack by hitting Israel and U.S. interests in the Gulf and analysts say one way to retaliate would be to close the Strait of Hormuz. About a third of all sea-borne shipped oil passed through the Strait in 2009, according to the U.S. Energy Information Administration (EIA), and U.S. warships patrol the area to ensure safe passage. –Reuters 

Black Swan event in 2012: Expect oil in 2012 to trend higher, but with plenty of volatility along the way; in the meantime, keep an eye out for black swan events that could send prices to uncharted levels. There are certain black swan events that could cause prices to go through the roof. One is if there’s some sort of military altercation with Iran. Most of the world’s oil crosses the strategically located Strait of Hormuz in the Arabian Gulf. In case of a standoff between the United States and its allies and Iran and its allies, there’s a large risk that some of the oil transitioning through the Arabian Gulf will be trapped. In this scenario, oil prices would experience the same effect as during the Arab oil embargo of the 1970s. Prices could skyrocket to $200/bbl or more with gas lines similar to those seen in America 40 years ago. A military confrontation with Iran that spills into the Arabian Gulf could send prices spiraling out of control. Another scenario to keep an eye on is the euro-debt crisis. If the crisis isn’t resolved and the eurozone implodes economically, it could have an unpredictable impact on prices. –Seeking Alpha

See Chapter 5 of my book: Iran, trip-wire to Armageddon – The Extinction Protocol