One thing about Western business media is that whenever any imperialism-opposing nation has a major success their subsequent understatement speaks volumes, as evidenced by an article in the oil trade press, The Iran-China Axis Is A Fast Growing Force In Oil Markets, at the website OilPrice. For trade journalists they are quite behind the trends of their industry: Iran and China are now a permanent force in the oil world, but far beyond that realm as well.
In reading OilPrice over the years I am not surprised: they have repeatedly reacted to the bilateral 25-year strategic agreement – which has just been fully signed – as though it was something which had not been in discussion for years; with total consternation as to why these two countries could want to ally with other; with an Iranophobia so enormous that their bias is rarely even barely concealed.
The outlook of their journalists is that of businessmen, and thus it’s the incredibly narrow and self-serving point of view of a specialist. It is unsurprising that – when compelled to formulate a political or moral viewpoint – OilPrice has a totally Cold War view of the world, which is typical in the West, and which explains why their headline calls it an “Iran-China Axis” instead of an “Alliance”. The use of such a term is typical Western media propaganda designed to conflate the right-wing Germans of the World War II era with modern Iran and China, even thought the latter are totally different from the former in political ideology, economic structure and social morality.
It’s a nonsensical and historically-nihilist conflation, but when examining OilPrice’s take on the Iran-China deal we are reminded that Western business media is quite content to sensationalise, to warmong and to create sustained market panic in order to increase the grip of militarism in the Western psyche and to continue the inequitable Western domination of the oil trade. OilPrice, specifically, also wants the price of oil to always increase.
Thus the article is full of many stupidities worthy of the idiocies of George W. Bush, the paranoia of J. Edgar Hoover, the anti-socialist hysteria of the Dulles brothers and the hypocritical phoniness of Barack Obama. Things of the lowest order of political analysis and knowledge abound, such as: “The first is they are both absolute dictatorships”, “the rogue Islamic country”, China’s Belt and Road Initiative is “a shield for China’s true intentions” and a “Trojan horse” for “military expansion”, etc.
(Of course, few international projects as transparently pragmatic and non-ideological as China’s BRI – if you accept China’s offer of mutually-beneficial cooperation there is no additional demand to also legislate acceptance of their “universal” values.)
But we benefit from knowing the oil trade’s viewpoint because while there are so very many financial shenanigans in the Western economy there is still a “real” economy, and oil is its lynchpin.
Oil is also the lynchpin of the US dollar’s global preeminence and overvaluation. Indeed, this article’s concluding paragraph is a reminder of those very fundamental – yet often forgotten – facts: “Finally, the introduction of a war premium to oil prices will cause a commensurate re-evaluation of oil equities in non-belligerent countries. The modern economy runs on petroleum products and derivatives, and will for many decades.”
The Great Financial Crisis and subsequent Great Recession proved that the Western economy is indeed incredibly vulnerable to many types of phonily-inflated equities, economic fundamentals-untethered financial products, sham derivatives concocted by high finance and more besides. However, the author is correct when he writes that paragraph because the Petrodollar – the forced sale of oil in dollars – is the most important and longest-running financial sham. It replaced the gold standard, after all.
But China and Iran’s unprecedented Petrodollar end run (and via a new joint China-Iranian bank) is just one part of why their bilateral agreement is such a huge deal. Not only does the pact upset the delicate balance of Western financial chicanery, but it permanently upsets longstanding Western geopolitical advantages, global geopolitical reality and especially the idea that the United States is the sole portal through which modern history can enter.
The US has fallen so very far since 1971 – now they are even behind China, and Iran just proved it
The bilateral deal’s importance can’t be understated for either side, and I have written about it for years. It’s as if – in the year 1545 – the Bolivian silver miners at Potosi struck a fair deal with the Spanish crown: Instead of getting enslaved, sham conversions and colonised Bolivia would still be an Incan cultural force today, with almost 500 additional years of illustrious history, learning and advancement. Thankfully, China is socialist – thus it is anti-imperialist and mindfully chooses cooperation over enslavement (either literally, through local puppets or through debt). Thankfully, Iran is not the shell-shocked Inca – they know who their enemies are, and also who works with enough goodwill to be welcomed.
For a more modern take, the deal is the equivalent of Richard Nixon’s “Opening of China” in 1971, except in a total role reversal: What is historically vital is no longer the position of the US, but the attitude of the superpower China.
Iran is often described as the last great “untapped market” – against all odds, expectations and supposed historical inevitabilities they chose the East as partners, not the West. That’s gigantic.
The deal will mark the “Opening of Iran” because it is not a mere “lifeline” to Iran – as it is often falsely described – but a guarantee of real prosperity, as it will be administered by Iran’s successful, revolutionary political structure. It is absolutely not more than just the achievement of stability, which Iran achieved entirely on its own starting in 1979, when the slogan was “Neither East nor West but the Islamic Republic”.
To quote from the OilPrice article:
“The New York Times is quoted as saying-
‘The partnership, detailed in an 18-page proposed agreement obtained by The New York Times, would vastly expand Chinese presence in banking, telecommunications, ports, railways, and dozens of other projects. In exchange, China would receive a regular — and, according to an Iranian official and an oil trader, heavily discounted — supply of Iranian oil over the next 25 years.’
And there you have it.”
And there you have it, indeed.
Oil-based cars and machines may be significantly phased out by greener technologies in 25 years or so, but Iran has made a superb bargain to sell as much oil as they can while they still can. The “heavy discount” is only about 4%, but I can see how – as a Western “oilfield veteran” – this OilPrice author expects everyone to scratch and claw for every penny he or she can grab. For Iranian bureaucrats, however, a longer-term economic view is required, as is less greed.
War – and sanctions (what used to be called “blockades” in English) are indeed war – certainly does force civilians and civil servants into more moral and more intelligent behaviors: self-sacrifice, unity, collective action, planning, determination, study, reflection, etc. The West’s sanctions have been perhaps praised in Iran nearly as often as they have been derided because Iran has had no choice but to build up its domestic capabilities – economic, intellectual, moral and natural – which naturally demanded a long-term commitment of domestic effort, political policies and acceptance of the national consensus.
But if the economic impact of illegal Western sanctions encouraged Iran’s leaders to make a 25-year oil bargain at only a 4% loss, then I say: take the money and run. If Washington, London, Paris and Tel Aviv fully had their way Donald Trump would have succeeded in forcing Iran to get 0% value from China – instead Tehran settled for 96% value over 25 years. If Iran doesn’t get yuan for every barrel that’s fine – China has technologies and skills which Iran can learn from, assimilate into future domestic projects and then likely export.
But this is what nobody seems to get about the indubitably socialist-inspired modern Iranian economy: Iran doesn’t do Western capitalism, i.e. it doesn’t sell out. Chinese companies will work alongside Iranian industries, all of which are state-owned and state-controlled to a degree which is unthinkable in the neoliberal West. China is not “buying” Iranian corporations – this is not $400 billion in “mergers” and “take-overs” – they are buying Iranian products or bartering for them via techniques Iran can learn from and projects which Iran needs to see built.
And there you have it: Iran secured money and intellectual investment for 25-years, and there is no danger of this investment being hijacked by foreign capital from any nation, which is how foreign investment works in Western neoliberalism. If the Iranian government can redistribute money downwards so effectively over four decades of hot and cold war, then surely they can do better in times of economic prosperity – this is the argument many Iranians have made over and over and over, and the West is fearfully aware of this rationale.
$16 billion per year in cash/goods/skills, and throw in a little thing called diplomatic unity, over 25 years – remember to compare that with what the West just offered: In 2019 France proposed a one-time $15 billion credit line. It was shot down by Washington, and of course Europe complied because neither want Iran to be prosperous or stable.
An incredibly ‘woke’ cooperation between 2 different ethnicities, cultures, regions & religions
Iran has proven to the world that America no longer has the ability to control the main global gate, and that is indeed a real achievement, but this achievement was equally fuelled by Western incompetence, cruelty, intolerance and greed. Iran and China have risen, thanks to their modern and revolutionary cultures and structures – of course – but just look at how far the West has fallen since 1971?
As for China it’s vital to remember that it was an oil embargo which pushed fascist Japan into war with the United States, but China now has a guaranteed source of oil stability. China, which imports 75% of its daily needs, is almost as oil-poor as Japan but now no matter what Western adventurism produces in the Straits of Hormuz Beijing can count on the certainty of enough oil supplies to get by.
Iranian oil is already serving as Beijing’s backup against Western imperialist immolation, as the OilPrice article relates in detail: “China is stockpiling oil at a pace unrivaled in the developed world.” Doing so is, “In a marked dichotomy with the U.S., China is building oil inventories by design.” China, in contrast to Western liberal democracy, actually has competent civil service motivated – not by “universal” values, perhaps – by actual values instead of personal greed.
And there you have it: good governance based on modern political ideas which value the individual citizen over the aristocrat’s dollars. That’s the reason why Iran and China rankle the West so much.
So how could the West possibly like the 25-year strategic pact – it’s a “permanent” sea change. It’s a “permanent” step up in class for both Iran and China, and via an incredibly unprecedented cooperation. “Our relations with Iran will not be affected by the current situation, but will be permanent and strategic,” said China’s Foreign Minister Wang Yi at the signing.
But it’s not based on mere dollars – it’s a “pact” in a very broad cultural and political sense, and that’s both a shocking rejection of the Western model and the exciting proposal of something new for global humanity.
China and the USSR never cooperated as closely as this. Impressive Cuba, all alone in the New World, just can’t bring the heft which Iran brings to the table. North Korea is so beset upon and so war-scarred that they reject diplomatic ties like what Iran just accepted. You’d have to go back to the Eastern Bloc’s cooperation with Moscow to find something similar.
But what makes this cooperation so incredibly and excitingly “woke” is that it’s between two totally different cultures, religions and ethnicities. It’s truly a meeting of minds, as equals.We could truly go on and on about this aspect, and we should. We should also repeatedly point out that Western liberal democracy demands homogeneity via total submission to their hive mind, whereas socialist democracy protects, accepts and elevates differences and minorities in a consensus-based democracy.
It’s a meeting of two longtime empires whose modern political structures now explicitly forbid empire-building. But that’s a point which stresses the past and looks backward.
This is a meeting of two countries bravely and excitingly looking forward to this new century, whether it’s the 15th (less than two weeks ago the Iranian calendar reached the year 1400), or the 48th (it’s year 4719 in China).
It’s an incredible cooperation, and one so very long in the making.