Conflicting Reports on Iran’s Occupation of Iraqi Oil Well
A grim scene from a previous conflict between the two OPEC members, the Iran–Iraq in the 1980s. (image: wikipedia.org)
Several conflicting reports are surfacing out of the Middle East surrounding a supposed Iranian invasion and seizure of an Iraqi oil well. According to Bloomberg, Iranian forces have entered Iraqi territory and seized the number four well in the East Maysan oil field.
Reuters reports that Iraqi Deputy Interior Minister Ahmed Ali al-Khafaji stated that “11 Iranian (soldiers) infiltrated the Iran-Iraq border and took control of the oil well. They raised the Iranian flag, and they are still there until this moment.” However, this statement is only one of many revisions he has made concerning the incident. According to BBC News, al-Khafaji initially denied that any Iranian incursion had occurred. Following his denial, the Deputy Interior Minister said that yesterday’s incursion was only one of many made over the past week. The National Iranian Oil Company has denied any incursion into Iraqi land.
Another facet of the story that adds confusion concerns the details of exactly how many Iranians invaded Iraqi territory and how well armed they were. As noted above, al-Khafaji stated that eleven Iranian soldiers invaded and took over an Iraqi oil well. But according to Border Guard General Zafer Nazmi, the invading soldiers have dug trenches and positioned tanks around the oil well.
If you are somehow not yet perplexed, Bloomberg has reported that the timing of the invasion makes the entire event only more baffling. The occupation comes days before Iran, Iraq, and several other members of the Organization of Petroleum Exporting Countries (OPEC) meet in Angola on December 22. Senior oil analyst of BNP Paribas SA in London, Harry Tchilinguirian is also befuddled, stating that “from a geopolitical perspective it is a surprising development in terms of timing, considering the upcoming OPEC meeting.”
This news coming out of the Middle East has not gone unnoticed by energy analysts and traders. According to Bloomberg.com, “crude oil for January delivery rose as much as $2.04, or 2.8 percent, to $74.69 a barrel on the New York Mercantile Exchange.
This is not the first time that Iranian belligerence has affected oil prices. In late November Iran flexed its military might with five days of highly public military exercises, which resulted in increased crude prices.
As of now Iraq has yet to take action and reports indicate that Iraq hopes to resolve this issue in a cautious and diplomatic fashion.
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