Detailed military plans to bomb Iran’s nuclear infrastructure have long been on the table in Tel Aviv.

Israeli daily Ha’aretz reported that Dennis Blair, the newly-appointed head of US intelligence, said Tel Aviv will eventually declare war on Tehran as a last-ditch effort to curb Iran’s enrichment capabilities.

And, former Israeli UN ambassador Dan Gillerman revealed that Tel Aviv is preparing a military offensive against the country.

War could be avoided if the Persian people elect the moderate political leader Mir Hossein Mousavi in tomorrow’s election.

Moderate ex-premier Mir Hossein Mousavi has emerged as Ahmadinejad’s main rival.  Mousavi believes Iran’s policy regarding its nuclear program is for peaceful purposes.   And, he has stressed that Tehran is ready for talks on the country’s nuclear program.  Plus, Mousavi seems open to beginning a dialogue with America.

Also, Mousavi has vowed to reduce heavy inflation through monetary policies, and has stressed the need for boosting the private sector.

A vote for Mousavi is a vote for peace.

The Iranians will make a statement tomorrow:  Do they want war or do they want peace.

Expect a record number of voters to cast their ballots in the Iranian presidential election being held on June 12.  If a clear winner does not emerge on June 12, the election will go to a second-round runoff on June 19.

If the Iranians re-elect Ahmadinejad be prepared.  Israel could hit them hard.

Then, Iran will unleash Hezbollah on Israel.  Israel could be attacked by a Hezbollah’s massive number of rockets and missiles from Lebanon.

The whole situation could escalate onto a huge regional war bringing in other Arab countries and even the U.S.

War with Iran could easily spin out of control and if Israel really feels that their existence is in jeopardy–they may even use their nuclear weapons.

If that happens, Iran will be destroyed and gold will be over $5,000 per ounce!

Protect yourself against geopolitical turmoil:  Buy Gold

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ProShares Ultra Gold (NYSE:UGL) also moves two times the daily price change of gold bullion.

DGP and UGL are both good ways to speculate in gold short-term, but they have added risks. But if you want more of a long-term core position in gold, (NYSE:GLD) is a better choice.

Best Wishes,

Ted Peroulakis

Source: Tomorrow’s Iranian Election Could Lead to Nuclear War

No matter where you’re looking at putting your money today, the impact of energy prices simply can’t be overstated. The commodities trade, US and foreign equities, debt and interest rates, everything is being driven by energy prices right now. Whether you’re trying to factor energy as a direct input into the price and consumption of manufactured goods or dealing with monetary policy’s impact on the dollar and debt markets, you’re implicitly making an energy trade.

I’ve said it before and I’ll say it again, if you’re trying to trade today’s markets without geopolitical intelligence, it’s like trying to trade the juice futures market without a weather forecast. You can do it, but good luck to you.

George has kindly passed me the article that was the basis of the Barron’s story. You’ll notice right away that unlike many of the so-called experts out there, Stratfor doesn’t airily dismiss underlying logistics in favor of handwaving. But better than taking my word for it, click here to get your own Stratfor Membership at the discounted rate for my readers. Every day you’ll receive the same forecasts and intelligence guidance that I use to shape my thinking on where the world is going – and especially on energy prices.

John Mauldin, Editor
Outside the Box

On June 20, The New York Times published a report saying that more than 100 Israeli aircraft carried out an exercise in early June over the eastern Mediterranean Sea and Greece. The article pointed out that the distances covered were roughly the distances from Israel to Iranian nuclear sites and that the exercise was a trial run for a large-scale air strike against Iran. On June 21, the British newspaper The Times quoted Israeli military sources as saying that the exercise was a dress rehearsal for an attack on Iran. The Jerusalem Post, in covering these events, pointedly referred to an article it had published in May saying that Israeli intelligence had changed its forecast for Iran passing a nuclear threshold — whether this was simply the ability to cause an explosion under controlled conditions or the ability to produce an actual weapon was unclear — to 2008 rather than 2009.The New York Times article, positioned on the front page, captured the attention of everyone from oil traders to Iran, which claimed that this was entirely psychological warfare on the part of the Israelis and that Israel could not carry out such an attack. It was not clear why the Iranians thought an attack was impossible, but they were surely right in saying that the exercise was psychological warfare. The Israelis did everything they could to publicize the exercise, and American officials, who obviously knew about the exercise but had not publicized it, backed them up. What is important to note is that the fact that this was psychological warfare — and fairly effective, given the Iranian response — does not mean that Israel is not going to attack. One has nothing to do with the other. So the question of whether there is going to be an attack must be analyzed carefully.

The first issue, of course, is what might be called the “red line.” It has always been expected that once the Iranians came close to a line at which they would become a capable nuclear power, the Americans or the Israelis would act to stop them, neither being prepared to tolerate a nuclear Iran. What has never been clear is what constitutes that red line. It could simply be having produced sufficient fissionable material to build a bomb, having achieved a nuclear explosion under test conditions in Iran or having approached the point of producing a deliverable nuclear weapon.

Early this month, reports circulated that A.Q. Khan, the former head of Pakistan’s nuclear program who is accused of selling nuclear technology to such countries as Libya, North Korea and Iran, had also possessed detailed design specifications and blueprints for constructing a nuclear weapon small enough to be mounted on missiles available to North Korea and Iran. The blueprints were found on a computer owned by a Swiss businessman, but the reports pointedly said that it was not known whether these documents had been transferred to Iran or any other country. It was interesting that the existence of the blueprints in Switzerland was known to the United States — and, we assume, Israel — in 2006 but that, at this point, there was no claim that they had been transferred.

Clearly, the existence of these documents — if Iran had a copy of them — would have helped the Iranians clear some hurdles. However, as we have pointed out, there is a huge gap between having enriched uranium and having a deliverable weapon, the creation of which requires technologies totally unrelated to each other. Ruggedizing and miniaturizing a nuclear device requires specializations from materials science to advanced electronics. Therefore, having enriched uranium or even triggering an underground nuclear device still leaves you a long way from having a weapon.

That’s why the leak on the nuclear blueprints is so important. From the Israeli and American point of view, those blueprints give the Iranians the knowledge of precisely how to ruggedize and miniaturize a nuclear device. But there are two problems here. First, if we were given blueprints for building a bridge, they would bring us no closer to building one. We would need experts in multiple disciplines just to understand the blueprints and thousands of trained engineers and workers to actually build the bridge. Second, the Israelis and Americans have known about the blueprints for two years. Even if they were certain that they had gotten to the Iranians — which the Israelis or Americans would certainly have announced in order to show the increased pressure at least one of them would be under to justify an attack — it is unclear how much help the blueprints would have been to the Iranians. The Jerusalem Post story implied that the Iranians were supposed to be crossing an undefined line in 2009. It is hard to imagine that they were speeded up to 2008 by a document delivered in 2006, and that the Israelis only just noticed.

In the end, the Israelis may have intelligence indicating that the blueprints did speed things up, and that the Iranians might acquire nuclear weapons in 2008. We doubt that. But given the statements Iranian President Mahmoud Ahmadinejad has made over the years, the Israelis have to be planning based on worst-case scenarios. What the sum total of their leaks adds up to is an attempt to communicate widely that there is an increased urgency in dealing with Iran, based on intelligence that the Iranian program is farther along than previously thought.

The problem is the fact that the Israelis are communicating. In fact, they are going out of their way to communicate. That is extremely odd. If the Israelis were intending to strike Iran’s nuclear facilities, they would want to be absolutely certain that as much of the equipment in the facilities was destroyed as possible. But the hard truth is that the heart of Iran’s capability, such as it is, does not reside in its facilities but in its scientists, engineers and technicians who collectively constitute the knowledge base of Iran’s nuclear program. Facilities can be replaced. It would take at least a generation to replace what we already regard as an insufficient cadre of expertise.

Therefore, if Israel wanted not simply to take out current facilities but to take Iran out of the nuclear game for a very long time, killing these people would have to be a major strategic goal. The Israelis would want to strike in the middle of the workday, without any warning whatever. If they strike Iran, they will be condemned widely for their actions. The additional criticism that would come from killing the workforce would not be a large price to pay for really destroying the Iranian capabilities. Unlike the Iraqi reactor strike in 1981, when the Israelis struck at night to minimize casualties, this strike against a more sophisticated program could not afford to be squeamish.

There are obviously parts of Iran’s nuclear capability that cannot be moved. There is other equipment that can be, with enough warning and with more or less difficulty, moved to unknown locations. But nothing would be easier to disperse than the heart of the program — the people. They could be moved out of harm’s way with only an hour’s notice. Therefore, providing warning that an attack was coming makes very little sense. It runs counter to basic principles of warfare. The Israelis struck the Osirak reactor in Iraq in 1981 with not the slightest hint of the attack’s imminence. That was one of the reasons it was successful. Telegraphing your punch is not very smart in these circumstances.

The Israelis have done more than raise the possibility that an attack might be launched in 2008. They have publicized how they plan to do it. Based on the number and type of aircraft involved in the exercise — more than 100 F-15 and F-16 fighter jets — one Israeli attack scenario could involve a third of Israel’s inventory of fourth-generation strike aircraft, including most of its latest-model F-15I Ra’am and F-16I Sufa fighter bombers. If Greece were the target in this exercise, then the equivalent distance would mean that the Israelis are planning to cross Jordanian airspace, transit through Iraq and strike Iran from that direction. A strike through Turkey — and there is no indication that the Turks would permit it — would take much longer.

The most complex part of the operation’s logistics would be the refueling of aircraft. They would have to be orbiting in Iraqi airspace. One of the points discussed about the Mediterranean exercise was the role of Israeli helicopters in rescuing downed flyers. Rescue helicopters would be involved, but we doubt very much they would be entering Iranian airspace from Israel. They are a lot slower than the jets, and they would have to be moving hours ahead of time. The Iranians might not spot them but the Russians would, and there is no guarantee that they wouldn’t pass it on to the Iranians. That means that the Israeli helicopters would have to move quietly into Iraq and be based there.

And that means that this would have to be a joint American-Israeli operation. The United States controls Iraqi airspace, meaning that the Americans would have to permit Israeli tankers to orbit in Iraqi airspace. The search-and-rescue helicopters would have to be based there. And we strongly suspect that rescued pilots would not be ferried back to Israel by helicopter but would either be sent to U.S. hospitals in Iraq or transferred to Israeli aircraft in Iraq.

The point here is that, given the exercise the Israelis carried out and the distances involved, there is no way Israel could do this without the direct cooperation of the United States. From a political standpoint in the region, it is actually easier for the United States to take out Iran’s facilities than for it to help the Israelis do so. There are many Sunni states that might formally protest but be quite pleased to see the United States do the job. But if the Israelis were to do it, Sunni states would have to be much more serious in their protestations. In having the United States play the role of handmaiden in the Israeli operation, it would appear that the basic charge against the United States — that it is the handmaiden of the Israelis — is quite true. If the Americans are going to be involved in a strike against Iran’s nuclear program, they are far better off doing it themselves than playing a supporting role to Israel.

There is something not quite right in this whole story. The sudden urgency — replete with tales of complete blueprints that might be in Iranian hands — doesn’t make sense. We may be wrong, but we have no indication that Iran is that close to producing nuclear weapons. Second, the extreme publicity given the exercise in the Mediterranean, coming from both Israel and the United States, runs counter to the logic of the mission. Third, an attack on Iran through Iraqi airspace would create a political nightmare for the United States. If this is the Israeli attack plan, the Americans would appear to be far better off doing it themselves.

There are a number of possible explanations. On the question of urgency, the Israelis might have two things in mind. One is the rumored transfer of S-300 surface-to-air missiles from Russia to Iran. This transfer has been rumored for quite a while, but by all accounts has yet to happen. The S-300 is a very capable system, depending on the variety (and it is unclear which variety is being transferred), and it would increase the cost and complexity of any airstrike against Iran. Israel may have heard that the Russians are planning to begin transferring the missiles sometime in 2008.

Second, there is obviously the U.S. presidential election. George W. Bush will be out of office in early 2009, and it is possible that Barack Obama will be replacing him. The Israelis have made no secret of their discomfort with an Obama presidency. Obviously, Israel cannot attack Iran without U.S. cooperation. The Israelis’ timetable may be moved up because they are not certain that Obama will permit an attack later on.

There are also explanations for the extreme publicity surrounding the exercise. The first might be that the Israelis have absolutely no intention of trying to stage long-range attacks but are planning some other type of attack altogether. The possibilities range from commando raids to cruise missiles fired from Israeli submarines in the Arabian Sea — or something else entirely. The Mediterranean exercise might have been designed to divert attention.

Alternatively, the Israelis could be engaged in exhausting Iranian defenders. During the first Gulf War, U.S. aircraft rushed toward the Iraqi border night after night for weeks, pulling away and landing each time. The purpose was to get the Iraqis to see these feints as routine and slow down their reactions when U.S. aircraft finally attacked. The Israelis could be engaged in a version of this, tiring out the Iranians with a series of “emergencies” so they are less responsive in the event of a real strike.

Finally, the Israelis and Americans might not be intending an attack at all. Rather, they are — as the Iranians have said — engaged in psychological warfare for political reasons. The Iranians appear to be split now between those who think that Ahmadinejad has led Iran into an extremely dangerous situation and those who think Ahmadinejad has done a fine job. The prospect of an imminent and massive attack on Iran could give his opponents ammunition against him. This would explain the Iranian government response to the reports of a possible attack — which was that such an attack was just psychological warfare and could not happen. That clearly was directed more for internal consumption than it was for the Israelis or Americans.

We tend toward this latter theory. Frankly, the Bush administration has been talking about an attack on Iran for years. It is hard for us to see that the situation has changed materially over the past months. But if it has, then either Israel or the United States would have attacked — and not with front-page spreads in The New York Times before the attack was launched. In the end, we tend toward the view that this is psychological warfare for the simple reason that you don’t launch a surprise attack of the kind necessary to take out Iran’s nuclear program with a media blitz beforehand. It just doesn’t work that way.

By George Friedman

Source: Mediterranean Flyover: Telegraphing an Israeli Punch?

On May 9, retired CIA operative Philip Giraldi posted an item on the American Conservative magazine’s blog: “There is considerable speculation and buzz in Washington today suggesting that the National Security Council has agreed in principle to proceed with plans to attack an Iranian al-Qods-run camp that is believed to be training Iraqi militants.” Defense Secretary Robert Gates, according to Giraldi, is the only senior decision-maker who’s not yet fully on board. The final decision rests with the president, and while there’s no evidence he’s ready to issue the order, there’s also no evidence he’s not.

Yesterday morning, Giraldi mused on why his reporting hadn’t been picked up by more mainstream media sources. Hours later, Israeli Army Radio reported that Bush was determined to attack Iran before the end of his term, the Likud-leaning Jerusalem Post picked up the story, and it was quickly plastered at the top of Drudge. Not exactly the New York Times or CNN, but it was enough to draw a non-denial denial from the White House. A very quick one. So quick that the story was instantly lost amid the anticlimactic primaries in Kentucky and Oregon, Sen. Ted Kennedy’s cancer diagnosis, and curiously enough, the news that oil was approaching $130 — an increase in which the Iran story evidently figured not at all.

As usual, it bears watching where the U.S. aircraft carriers are located. And as near as we can tell, the Navy spokesman who said late last month that the presence of two carriers in the Persian Gulf was a short-term situation was telling the truth. The Truman has been sailing the Mediterranean for the last ten days or so, leaving the Lincoln alone among the carrier fleet in the Gulf.

Source: The “X” Factor