Iran Confirms Threat to Cut Off Oil Exports to Europe

If escalating war of words continues, the global economic recovery will be threatened

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Iran Confirms Threat to Cut Off Oil Exports to Europe

The New York Times has just reported Iran's official confirmation that it is threatening to cut oil exports to six European countries. Earlier rumors of such a threat sent oil prices to a six-month high. Why is this important? Because, as the authors of a recent Nature article said (and as I myself have said in this space), "It seems clear that it wasn't just the 'credit crunch' that triggered the 2008 recession, but the rarely-talked-about 'oil price  crunch' as well." Near-term, if the Iranian crisis spins out of control, the effect could be plunge the advanced industrial countries back into recession; long-term, permanently high oil prices would severely limit growth prospects.

A positive element in the current picture is Iran's declared willingness to resume nuclear negotiations with six counterparties (the so-=called P5 + 1), but pessimists worry that once again it may be just playing for time--talking to ease international pressure, only to resume suspect activities as soon as the pressure is off. Meanwhile, tensions between Iran and Israel have been sharply rising, as a handful of top Iranian nuclear scientsts have been assassinated, its enrichment facility was infected by the immensely ingenious Stuxnet virus, and its major missile test facility mysteriously blew up, killing the country's top rocket scientist. Earlier this week there were reports of assassination attempts on Israelis in three foreign countries, one of the attacks closely resembling from a procedural point of view two assassinations of Iranian scientists and engineers in Tehran.

The most recent round of escalation began with the release by the International Atomic Energy Agency of a report in November, finding that Iran had a full-fledged nuclear warhead development program up until 2003 and very likely has continued with some elements of that program.

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This photograph shows a car with the words “We Drive Solar” on the door, connected to a charging station. A windmill can be seen in the background.

The Dutch city of Utrecht is embracing vehicle-to-grid technology, an example of which is shown here—an EV connected to a bidirectional charger. The historic Rijn en Zon windmill provides a fitting background for this scene.

We Drive Solar

Hundreds of charging stations for electric vehicles dot Utrecht’s urban landscape in the Netherlands like little electric mushrooms. Unlike those you may have grown accustomed to seeing, many of these stations don’t just charge electric cars—they can also send power from vehicle batteries to the local utility grid for use by homes and businesses.

Debates over the feasibility and value of such vehicle-to-grid technology go back decades. Those arguments are not yet settled. But big automakers like Volkswagen, Nissan, and Hyundai have moved to produce the kinds of cars that can use such bidirectional chargers—alongside similar vehicle-to-home technology, whereby your car can power your house, say, during a blackout, as promoted by Ford with its new F-150 Lightning. Given the rapid uptake of electric vehicles, many people are thinking hard about how to make the best use of all that rolling battery power.

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