Iran's Riyal Plunges To Record Low After US Sanctions

On New Years Eve President Obama issued the sanctioning of Iran's central bank and foreign banks that do business with it.

" The bill signed by Obama on Saturday includes an amendment barring foreign financial institutions that do business with Iran's central bank from opening or maintaining correspondent operations in the United States. The Obama administration, however, is looking to soften the impact of the measure, fearing they could lead to a spike in global crude oil prices or pressure key allies that import Iranian oil. "




Source

TEHRAN, Iran (AP) — Iran's currency hit a new record low to the U.S. dollar on Monday, two days after President Barack Obama signed into law a bill targeting Iran's central bank as part of the West's efforts to pressure Tehran over its nuclear program.

State radio said the Iranian currency's exchange rate hovered around 16,800 riyals to the dollar, marking a roughly 10 percent slide compared to Thursday's rate of 15,200 riyals to the dollar. The riyal was trading at around 10,500 riyals to the U.S. dollar in late December 2010.

That can't be good, and I have a feeling nothing positive will come of this move..

*shakes head*

There is no mistaking the direction moves like this risk heading us in.

Good, no use in placing sanctions if they don't have an effect.

Swift acting too, I am impressed.

Originally posted by thoughtsfull
That can't be good, and I have a feeling nothing positive will come of this move..

*shakes head*

There is no mistaking the direction moves like this risk heading us in.

It almost appears as if the position of the US is to push Iran to the brink, which will result in oil prices skyrocketing. What a great way to amass vast amounts of dollars and use them before there useless. This may also push the Keystone pipeline to the forefront of the DNC..people will be screaming for it, believing it will reduce the prices.

If i were Iran i would be sorely tempted to just cease production for a week and see what happens then.

Lets see how the rest of the world reacts to no Iranian oil, i guarantee there would be another UN meeting to discuss less severe measures within the week.

No Iranian oil will mean a spike to $200-$300 dollars a barrel, crippling importing nations worldwide.

Cosmic..

Great way to see in the new year. This cannot be good at any level.

reply to post by Cosmic4life


That would annoy China, and right now China is the only one who has the power to stop any military action against Iran. China is still increasing investment and trade relations with them and that doesn't seem to be slowing down, so they haven't thrown them under the bus yet imo.

Good for Iran... This should of happened years ago.

Governments doing a good job.

Originally posted by Cosmic4life
If i were Iran i would be sorely tempted to just cease production for a week and see what happens then.

Lets see how the rest of the world reacts to no Iranian oil, i guarantee there would be another UN meeting to discuss less severe measures within the week.

No Iranian oil will mean a spike to $200-$300 dollars a barrel, crippling importing nations worldwide.

Cosmic..

If Iran did that, they would only make even more enemies because it would impact the entire world.. not only that but they'd be financially shooting their own foot by doing it.. I can't see Iran following through with a threat of stopping oil production.. it's their primary income after all ..

If anything, this would make them LESS likely to halt production because they really need that money.

reply to post by Cosmic4life


That would also have a crippling effect on Iran's economy since it depends on the Hormuz for 40 percent of it's imported refined petro,which it uses for it's automobiles, but also to power it's factories and extract oil.

But also seems right on par with what the US wants.

Brainfart...

reply to post by Daedal


Failing to see how that article says something opposite. Isn't it saying a USD buys you more Iran dollars than before? The same as the Iran dollar falling in value?

Correct me if I'm wrong.

Originally posted by mayabong
reply to post by Daedal

 

Failing to see how that article says something opposite. Isn't it saying a USD buys you more Iran dollars than before? The same as the Iran dollar falling in value?

Correct me if I'm wrong.

Thanks for pointing that out...

reply to post by Darkblade71


Our sanctions against them raise the average cost of the typical Iranian approx 10% for normal goods (including food)... If Iran were to say... refuse exports to all Western Countries the effect on the average Westerner for costs of all goods .. would be astronomical. Seems to me that we are only playing with fire, and for what? Iran may or may not want a nuke..... so what? Pakistan has nukes. Israel has nukes. I'd be surprised if Saudi Arabia doesn't have nukes.

reply to post by miniatus


Iran doesn't have to shut down all oil operations. They need only embargo Western nations.. no imports to Europe. That alone would have devastating effects on the European economy, exacerbating the problems plaguing their nations. While the increased cost of oil would off set the lack of production a little bit, keep in mind Iran has a massive government surplus of funds, and huge "rainy day" funds. They could withstand the crisis far longer than the West.

Originally posted by Rockpuck
reply to post by miniatus

 

Iran doesn't have to shut down all oil operations. They need only embargo Western nations.. no imports to Europe. That alone would have devastating effects on the European economy, exacerbating the problems plaguing their nations. While the increased cost of oil would off set the lack of production a little bit, keep in mind Iran has a massive government surplus of funds, and huge "rainy day" funds. They could withstand the crisis far longer than the West.

I think that would end up hurting Iran more than the West, especially if the Gulf Arab States can off set any any potential loss of Iranian oil in the world market, as Saudi Arabia has claimed.

Source

Gulf Arab nations are prepared to offset any potential loss of Iranian oil in the world market, a senior Saudi oil official said as Iranian officials stepped up their rhetoric Wednesday about shutting off a key supply route.

The remarks from the world's largest oil producer came after Iran's vice president on Tuesday warned his country was ready to close the Strait of Hormuz — a vital waterway through which a sixth of the world's oil flows — if Western nations impose sanctions on its oil shipments.

Another thing to keep in mind is the Arab Spring, this movement throughout the ME is still ongoing. And according to the United Nations Secretary General Ban Ki - Moon it's to be sustained.

UNITED NATIONS: Secretary-General Ban Ki-moon, in his second term as chief of the United Nations, wants to help people who rose up in the Arab Spring attain and sustain freedom and democracy.

Source

As he embarks on a new five-year term starting New Year’s Day, Ban said one of his top priorities is to help Arab countries sustain their moves toward democracy. He also said he intended to do more for young people and women, and address frustrations over the growing gap between the rich and poor expressed by the Occupy movement.

This is a moment of historic change “which we have to seize and help them,” Ban said.

Ban’s ability to influence what happens is limited because the UN secretary-general has no independent power over international affairs. It is up to the UN’s 193 member states to take action, and only the actions of the powerful 15-member Security Council are legally binding.

reply to post by Daedal


Saudi Arabia is a powerful oil producer.. but it cannot, in any way, ever hope to make up what Iran produces. Saudi Arabia currently produces about 8m/bb a day .. Iran currently produces approx 6m/bb a day. The peak that Saudi can produce is 10m/bb with given infrastructure..

Not to mention the fact that it's not like the USA where we can take oil from the Saudis whenever prices get high to offset those prices.. we don't import from Iran, Europe does.. to switch import direction from Iran to Saudi Arabia would take considerable time and money.. the logistics are impossible. Saudi may want to threaten Iran because they despise each other, but in reality Saudi Arabia has no chance in hell of offsetting an embargo by Iran. They actually tried once, in the 1970's and failed miserably.

Originally posted by Rockpuck
reply to post by Darkblade71

 

Iran may or may not want a nuke..... so what? Pakistan has nukes. Israel has nukes. I'd be surprised if Saudi Arabia doesn't have nukes.

Nukes are a straw man for the real reason. The real objective is to draw Iran into a full scale war with America and our allies. We want to invade Iran and replace the existing anti-American government with one that will be our ally.
Its all about resource control. The new world order wants their puppet installed. I guess TPTB did not think an "Arab Spring" would work in Iran not with the U.S. history of regime change in Iran.

The Iranian people will once again bare the brunt of US aggression but if gas goes $7.00/gallon its going to hurt a lot of people in this country who are the brink anyway.

But what does the NWO care about the people of either country? Their goal is elimination not preservation.

reply to post by Rockpuck


Do you think in the 40 yrs since the last attempt that a contingency plan has been put in place to deal with another potential crisis. So Europe would definitely be affected far more than the US would, but the side effects would cripple America as well due to the damage in Europe?

reply to post by Daedal


Saudi Arabia can only increase production by 1.5 million barrels..they claim, i think they would be hard pushed to achieve that.

Iran produces about 4 million barrels per day and uses 1.5 million for its own consumption, that would leave a shortfall of 2.5 million barrels per day on the global market.

So even if Saudi Arabia could manage an extra 1.5 mil BPD that still leaves a 1 mil BPD shortfall on the global market.

Iran may have spare capacity to go to 6 mil BPD, but Saudi Arabia definitely does not have anywhere near the headroom they claim.

Cosmic..