- Language: English
- 774 Pages
- Published: October 2012
- Region: Global
Turkey Geopolitics Report: Iran-US tension in the Gulf and its possible effects on Turkey
- Published: January 2012
- Region: Turkey
- 5 Pages
- Emerging Markets Direct
Tensions between the Tehran regime and the US/West have risen alarmingly in recent month. At the center of the row is Iran’s nuclear program. US President Barack Obama already signed into law a bill targeting Iran’s central bank, making it more difficult for Iran to export oil while the EU agreed to ban imports of Iran crude. Iran says its nuclear program is peaceful and threatens to block the Strait of Hormuz, a major oil shipping lane. Both sides are aware the consequences are too dire. Iran would not be able to keep the Strait too long but even an attempt will be enough to send oil prices to record highs. A war with Iran may well spread to the entire region and has the potential to plunge the world economy into a depression.
Turkey is watching developments in the Gulf very carefully. Ankara supports the UN sanctions and urges Tehran to drop its nuclear program but Turkey says, at the same time, it is against any military options or further sanctions against Iran. Turkey imports 30% of its crude from Iran. Government officials say US sanctions are not binding for Turkey. But, the continuing saber-rattling and war of words between Iran and the US, will affect Turkey through higher oil prices, then we may eventually see higher trade and current account deficits. Politically, Ankara seems to be caught between its long-time ally US and neighbor. If pushed to choose between Iran and the US/West, Ankara will most probably side with the latter. Ankara will try to avoid active engagement in the case of a hot conflict, and keep a low profile. But this is for sure; Turkey will have to make some difficult decisions.
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Background to current tension in the Gulf
A war in the Gulf imminent?
Turkey caught in the middle?
Oil politics, sanctions and Turkish economy