New high in US-Iran tension : Showdown over N-issue imminent

IT seems Iran is not far away from acquiring the nuclear weapons capability. That is why the US appears to be more worried now than it has ever been. The buzz is that the US wants to paralyse the Iranian economy to force Tehran to abandon its dangerous ambitions. The US has imposed fresh sanctions on the Iranian central bank and financial sector to prevent it from doing oil-related transactions. The sanctions will also be applicable in the case of the countries that refuse to snap their trade relations with Iran. Russia and China, which have close economic relations with Iran, may be among the other affected countries if no corrective measures are taken. This may complicate the situation, leading to unimaginable consequences.

Iran is showing no signs of being scared of the US action. Instead, it has warned the US to keep off the strategically significant Strait of Hormuz through which one-fifth of the world’s oil supply passes. The US navy’s biggest aircraft carrier is about to enter the Strait of Hormuz as a matter of routine. Iran claims that it has the right to block the shipping channel and it will do so as its response to the latest US action to reduce Tehran’s earnings through oil exports considerably. The showdown, which appears imminent, between the US and Iran may lead to an acute oil shortage, resulting in a fresh rise in energy prices. The situation may become more complex with the European Union also threatening to announce an embargo on importing oil from Iran.

All this is happening over six weeks after the International Atomic Energy Agency issued its latest report saying that Iran may be working secretly over a nuclear warhead design despite its denials to the contrary. Since then the US has been under tremendous pressure from its West Asian allies like Saudi Arabia to prevent Iran from acquiring nuclear weapons which will upset the power balance in the region. The Saudis may help the US scheme of things by increasing their oil production to keep its prices at the desired level. The Iranians seem to be ready for a military conflict with the US. Can the US afford it when its economy is finding it difficult to come out of the recessionary quagmire?