President Mohamed Morsy became the first Egyptian president to visit Iran’s Capital in three decades, although the visit was described by one of his Advisers as "merely out of diplomatic courtesy, handing over the rotating presidency of the non-aligned summit to Iran’s President Mahmud Ahmadinejad." Serious Analysts saw it differently and Mr.Morsy certainly gave them reasons for that.
The Egyptian president delivered a speech where he criticized Syria’s Assad’s regime and lashed at Mr. Ahmadinejad’s support to Assad, something a bit far from diplomatic courtesy and more of a well-planned move.
What was Mr.Morsy and his advisers plan? Is he honing Egypt’s new foreign policy or is he only playing a part in Middle East’s new chapter crafted by many other players?
It is in this take that these matters are discussed
The key player will have to be Iran, A Prince of Persia behaving like the Shakespearian Danish prince Hamlet, who seems to be guided by a ghost in every awkward move he makes. It has been ten years already
since the start of what is now known as the Iranian nuclear crisis, though the Iranian nuclear program started in the1950s with the help of the United States itself as part of a program called Atoms for Peace, the United States and the western governments stopped their participation in the program when the Iranian Revolution toppled the Shah in 1979. Even when Ayatollah Khomeini had serious religious reservations about nuclear weapons, considering them evil, the program was resumed on small scale when Iraq invaded Iran in September 1980 but underwent significant expansion after Khomeini's death in 1989.
Several research sites, two uranium mines, a research reactor and three Uranium enrichment plants is what forms the infrastructure of the Iranian nuclear program.
However the question was never really about the How (the capabilities of Iran successfully having the Program working), it was always a Why question. Why is Iran, so rich in natural resources, a country that ranks third largest in the world with oil reserves (approximately 150 billion barrels) and a country with a proved natural gas reserves of about 15.8% of world's total reserves, why do they need an atomic energy program?
Iran's motivations where never understood, despite having the riches, three decades of economic mismanagement had their impact alright, their national currency has lost 50 percent of its value against other currencies in the last year, the consumer prices are rising officially by 25 percent annually and unemployment stands at a staggering 11 percent.
One would think that it is high time to play diplomacy and try to get rid of the sanctions enforced against Iran's oil and banking sectors which only intensifies the economic crisis, but the Iranian administration doesn't seem to heed the problem that much, matter of fact, they seem not to notice that now, many in Washington and Tel Aviv see military force as the only option left. The US Republican Party candidate Mr. Mitt Romney promised in Jerusalem last month to give Israel a green light for a pre-emptive strike on Iranian nuclear facilities.
President Mahmud Ahmadinejad responded defiantly that nothing will stop Iran's pursuit of its " Inalienable right" and hinted that a retaliation can be closing the Straits of Hormuz (through which around 20 percent of the world's oil passes).
Now it's pretty much clear to political and financial analysts that after the November US presidential elections, a War in the Persian Gulf is highly possible and a number of questions need to be answered to properly understand the expected repercussions of this action.
1. Can Iran close the Straits of Hormuz?
Military assessments confirm that Iran has the ability to effectively close the Straits for no more than 10 days after which it may become capable of only threatening safe passage through the straits for a month or two via isolated cruise missile attacks.
Though Iran has upgraded its technology and tactical capability since the Iraq-Iran War (1980-1988). It relies on a combination of mines, land-based anti-ship cruise missiles, and large numbers of small boats for waves of suicide attacks.
This is in no way a considerable force, and Iran knows this, though the Iranian Government hinted repeatedly that it may be forced to close the straits of Hormuz, there is the assumption that Iran is a rational actor, surely the threats bolsters the price of Oil benefiting Tehran as a major exporter and it’s a good card to threat of drawing and end a good civilized game of Poker and start a brawl, so everyone keeps quiet, but will Iran risk a US punitive retaliation? Highly unlikely.
2. What is the probability that Israel will attack Iran?
It's almost impossible to answer this without detailed intelligence. However, the probability will naturally increase following the November US elections unless US manages to form an international coalition that would support and participate in the military strike.
Since a successful strike against Iranian nuclear facilities would require estimably over 90 aircraft, mid-air refueling, potential coordination with Israeli naval assets is almost inevitable so Israel will almost surely participate but not necessarily initiate an attack.
3. What will be the financial impact on Egypt in the event of an attack on Iran?
Understandably the risks to the oil markets following an attack on Iran will go beyond the closure of the Straits.
The concern at that point would be that the attack could initiate a region-wide conflict. The threat to Saudi oil fields was deemed to be substantial. Back in the Gulf war Oil prices increased over 80% in the initial months following the beginning of war.
The only thing that will reassert the Markets is a quick US naval dominance on the straits and that is highly likely due to the comparable difference in military capability.
If global markets need assurances, then Egypt and other Middle East neighbors will need more than simple assurance for the stability of oil prices.
The Egyptian Head of State probably asked US secretary of state Ms.Clinton in their meeting two weeks prior his visit to Tehran the same questions. He has his own concerns, an ailing economy desperately needing for help; will he become the pragmatist when needed?
Ensuring pass to naval assets and facilitating transportation through Suez Canal is crucial to the US, they need that Letter of guarantee and they can pay handsomely as they did back in 2003 when they needed the same facilities to strike Iran's neighbor Iraq.
It also appears that the Egyptian president has other interests as well, he needs Syria's Assad overthrown, surely a "side strike" to an already fallen army is not going to be much trouble, Morsy might think, besides it is In the context of the "Arab Spring”, that the reaction by the regions populations is unpredictable, painting a picture of a military campaign that is doing a "good deed" getting rid of Assad, a tyrant who mass-murdered his own people, might gain support at best and won't hurt at worst.
For better or worse, The US knows that success will depend on the help of others. Forming a coalition against Iran is critical, and it's not going to be hard if they play their cards right, thanks to Tehran's bloody alley, Assad's massacres is helping undecided countries like Egypt to join the coalition.
After all, looking back at how Iran handled its nuclear program crisis in the past decade you're not left wondering anymore about the ending; playing Hamlet means you kill yourself in the end.
Hashem Fouad
Cairo, September 2012
