Get ready for higher oil prices: Iran resumes uranium enrichment

This article, sourced from Reuters, delivers another blow to oil prices and will probably be more bad news for our imbalanced economy.

Snippets:

A DEFIANT Iran today ended snap UN checks of its nuclear sites and said it was resuming uranium enrichment, a day after being reported to the Security Council over suspicions it is building nuclear weapons.

"Iran has stopped all voluntary measures that it undertook in the past two-and-a-half to three years," Foreign Minister Manouchehr Mottaki told a news conference. "We have no commitment to the Additional Protocol any more."

Mr Ahmadinejad said nothing could deflect Tehran's pursuit of atomic know-how. "Our enemies cannot do a damn thing. We do not need you at all. But you are in need of the Iranian nation," he told a crowd in Tehran earlier today.

"Content yourself with as many resolutions as you like, you cannot prevent the will of the Iranian people," he said. Iran has warned that any sanctions against it would send oil prices beyond a level industrialized economies could bear.


This Australian article compares President Mahmoud Ahmadinejad to Hitler and later states:

"The escalation in the standoff with Iran, the world's fourth-largest oil producer, seemed certain to drive energy prices higher on the markets today. It will also raise fears that Tehran might respond by increasing support for militant Islamic groups in the Middle East, of which it is already a major financial backer. "


Bottom Line:
The American Consumer is completely strapped , personal bankruptcies are at a record, the housing market and economy are beginning to cool, the US is piling up record trade deficits, and the dollar is on shaky ground. Ultimately, higher oil prices will wreak havoc on the U.S. and world economies and could throw the world into a deep recession.


If you are not familiar with this IRAN oil issue, I urge you to read these previous posts.

http://economicrot.blogspot.com/2006/01/time-to-worry.html

http://economicrot.blogspot.com/2006/01/oils-affect-on-world-economy.html