Debkafile great article. Iran is getting ready to fulfill its destiny found in Ezekiel chapters 38 and 39. Keep looking up!

According to debkafile‘s Iranian sources, Tehran is preparing an underground test of a one-kiloton nuclear device during 2012, much like the test carried out by North Korea in 2006. Underground facilities are under construction in great secrecy behind the noise and fury raised by the start of advanced uranium enrichment at Iran’s fortified, subterranean Fordo site near Qom.
All the sanctions imposed so far for halting Iran’s progress toward a nuclear weapon have had the reverse effect, stimulating rather than cooling its eagerness to acquire a bomb.

Yet, according to a scenario prepared by the Institute for National Security Studies (INSS) at Tel Aviv University for the day after an Iranian nuclear weapons test, Israel was resigned to a nuclear Iran and the US would offer Israel a defense pact while urging Israel not to retaliate.

As quoted by the London Times Monday, Jan. 1, INSS experts, headed by Gen. (ret.) Giora Eiland, a former head of Israel’s National Security Council, deduced from a simulation study they staged last week that. Their conclusion is that neither the US nor Israel will use force to stop Iran’s first nuclear test which they predicted would take place in January 2013.

Our Iranian sources stress, however, that Tehran does not intend to wait for the next swearing-in of a US president in January 2013,  whether Barack Obama is returned for a second term or replaced by a Republican figure, before moving on to a nuclear test.

Iran’s Islamist rulers have come to the conclusion from the Bush and Obama presidencies that America is a paper tiger and sure to shrink from attacking their nuclear program – especially while the West is sunk in profound economic distress.

debkafile‘s sources stress that both Tehran and the INSS are wrong: The Tel Aviv scenario is the work of a faction of retired Israeli security and intelligence bigwigs who, anxious to pull the Netanyahu government back from direct action against the Islamic Republic, have been lobbying for the proposition that Israel can live with a nuclear-armed Iran.
Our Washington sources confirm, however, that President Obama considers the risk of permitting a nuclear-armed Iran to be greater than the risks of military action.

Monday, Jan. 9, top administration officials said that developing a nuclear weapon would cross a red line and precipitate a US strike. US Defense Secretary Leon Panetta: “If Iran takes the step to develop a nuclear weapon or blocking the Strait of Hormuz, they’re going to be stopped.” He was repeating the warnings of the past month made by himself and Chairman of the Joint US Chiefs of Staff. Gen. Martin Dempsey.  

As for Israel, Dennis Ross, until recently senior adviser to President Obama, reiterated in a Bloomberg interview on Jan. 10: “No one should doubt that President Barack Obama is prepared to use military force to prevent Iran from acquiring a nuclear weapon if sanctions and diplomacy fail.”
As for Israel, Ross said: “I wouldn’t discount the possibility that the Israelis would act if they came to the conclusion that basically the world was prepared to live with Iran with nuclear weapons,” he said. “They certainly have the capability by themselves to set back the Iranian nuclear program.”

Israel’s media screens and front pages are dominated these days by short-lived, parochial political sensations and devote few words to serious discourse on such weighty issues as Iran’s nuclear threat.
This is a luxury that the US president cannot afford in an election year.  Iran’s acquisition of a nuclear bomb and conduct of a nuclear test would hurt his chances of a second term. The race is therefore on for an American strike to beat Iran’s nuclear end game before the November 2012 presidential vote.

The INSS have also wrongly assessed Russia’s response to an Iranian nuclear test as “to seek an alliance with the US to prevent nuclear proliferation in the region.”
This fails to take into account that Prime Minister Vladimir Putin, running himself for a third term as president in March, has already committed Moscow to a new Middle East policy which hinges on support for a nuclear Iran and any other Middle East nation seeking a nuclear program. This is part of Russia’s determined plan to trump America’s Arab Spring card.

Traders were closely watching rising tensions between Iran and Western powers on Wednesday, surmising that if Iran makes good on a recent threat to close the Strait of Hormuz, a key oil passageway, oil prices could rise sharply.

Last month, Iran threatened to close the strait as possible retaliation for new U.S. and European economic sanctions. The U.S. has said it will not tolerate such a move. Brent Crude could temporarily jump to as high as $210 if the strait was closed, independent consultancy firm Capital Economics said. Oil prices are hovering at around $103 per barrel, according to Reuters on Thursday. In a report, Capital Economics played down this declaration, saying, “Neither side would want tensions to spiral this far out of control. Indeed, the threat of another ‘super-spike’ in oil prices when the global economy is still so fragile is itself a very powerful reason for the West to hold off from any military action.”

“By far the bigger risk is that oil prices will collapse due to an escalation of the financial crisis in the euro-zone,” the report concluded.

Capital Economics expects Brent to trade at $85 at the end of this year while Bank of America Merrill Lynch forecasts an average price of $108 in 2012.

On Thursday, British Defense Secretary Philip Hammond was expected to declare that the U.K. would respond militarily if Iran follows through on its threat to close the Strait of Hormuz, Sky News reported.

Hammond was set to use a speech in Washington D.C. to warn Iran that any attempt to close the oil route would be “unsuccessful” and could be stopped in part by the Royal Navy.

Sky News published excerpts of the speech he was expected to give at the Atlantic Council, in which he was set to declare that “any attempt by Iran to do this would be illegal and unsuccessful.”

“Our joint naval presence in the Arabian Gulf, something our regional partners appreciate, is key to keeping the Strait of Hormuz open for international trade. It is in all our interests that the arteries of global trade are kept free, open and running. Disruption to the flow of oil through the Strait of Hormuz would threaten regional and global economic growth,” he was expected to say.

Hammond’s speech comes one day after European governments agreed in principle to ban imports of Iranian oil. The announcement, which crowns new Western sanctions, dealt a blow to Tehran, months before an Iranian election.

The prospective embargo by the European Union, along with tough U.S. financial measures signed into law by U.S. President Barack Obama on New Year’s Eve, form a concerted Western campaign to hold back Iran’s nuclear program.

Iran says the program is strictly non-military, but Western countries say a November U.N. report shows it seeks to develop a nuclear weapon. Talks between Tehran and major powers broke down a year ago.

Diplomats said EU envoys held talks on Iran in the last days of December, and that any objections to an oil embargo had been dropped, notably from crisis-hit Greece which gets a third of its oil from Iran, relying on Tehran’s lenient financing. Spain and Italy are also big buyers.

“A lot of progress has been made,” one EU diplomat said, speaking on condition of anonymity. “The principle of an oil embargo is agreed. It is not being debated anymore.”

U.S. State Department Spokeswoman Victoria Nuland called the EU moves “the kinds of steps that we would like to see not just from our close allies and partners in places like Europe but from countries around the world.”

“We do believe that this is consistent with tightening the noose on Iran economically,” she said.

A U.S. Treasury official said Tehran’s oil revenues could be choked off without disrupting global oil markets. Treasury Secretary Timothy Geithner will travel to China and Japan next week to discuss U.S. sanctions on Iran and the state of the global economy.

The embargo will force Tehran to find other buyers for oil. EU countries buy about 450,000 barrels per day of Iran’s 2.6 million barrels per day in exports, making the bloc collectively the second largest market for Iranian crude after China.

Italian Prime Minister Mario Monti said Italy was ready to back an oil embargo as long as it was imposed gradually and deliveries to repay Tehran’s debts to Italian energy firm ENI were exempted.

Tehran insisted it would have no trouble. “We could very easily replace these customers,” said National Iranian Oil Company International Director. S. M. Qamsari,.

But the new U.S. sanctions have already made it difficult for Iran to keep its customers, and could force it to offer steep discounts to countries willing to risk doing business with it, hurting its revenues. Its biggest trading partner, China, driving a hard bargain, has cut its orders of Iranian oil by more than half this month.

Western countries have imposed various sanctions on Iran for years with little impact. But the latest measures are qualitatively different, directly targeting Iran’s oil industry, which forms 60 percent of its economy.

Most traders expect Iran will still find buyers for its crude, mostly in Asia, but it is going to have to offer substantial discounts, cutting back the revenue that the state relies on to subsidize basic goods for its citizens.

Tougher sanctions appear to be having an impact already on Iran’s streets, where prices for foodstuffs are soaring. Iran’s currency, the rial, has lost 40% of its value against the dollar over the past month.

Currency exchanges have shut their doors in Tehran and Iranians have been lining up to withdraw their savings from banks and buy dollars.

That economic hardship is being felt by the public two months before a parliamentary election, Iran’s first since a disputed 2009 presidential vote that led to massive street demonstrations, put down violently by Iran’s rulers.

Iran’s leaders are anxious to prevent any popular unrest, especially after the Arab Spring revolts last year showed the vulnerability of Middle Eastern governments to street protest.

Iran has warned that any steps to cut its oil exports could cause havoc in international oil markets at a time of global economic pain. In recent weeks it has also resorted to increasingly aggressive military saber-rattling.

In another heated escalation over the strategic Strait of Hormuz, Iran Tuesday, Jan. 3, threatened to take action if the US aircraft carrier which “moved to the Sea of Oman because of our drill returns to the Persian Gulf.” Army chief Lt. Gen. Ataolla Salehi said:” Iran will not repeat this warning.”
He referred to the USS Stennis as “the enemy’s carrier,” which “I recommend and emphasize… not return to the Persian Gulf.” He avoided naming the US vessel or the details of action Iran might take if it returned.
debkafile‘s military sources report that the Stennis transited the Strait of Hormus Wednesday, Dec. 28 and entered the Sea of Oman where Iran was staging a naval drill. Washington was demonstrating freedom of navigation in the international strait through which one-fifth of the worlds exported oil is shipped and underlining Iran’s inability to close it to merchant shipping and US warships.
Iran said that its surveillance aircraft and warships tracked and filmed the US carrier’s movements in and around Hormuz which it claims to fully control.

Saturday, Dec. 31, Iran announced a long-range missile test-fire would take place over the strait, thereby causing a five-hour stoppage of shipping traffic. Later, an Iranian general said the missile test was delayed. debkafile‘s Iranian and military sources reported that this was a trick to prove Iran capable of closing the Strait of Hormuz in defiance of strong warnings from Washington.

Monday, Jan. 2, the Iranian navy marked the last day of its Hormuz drill by testing shore-to-sea Qader and Nour missiles. The Qader is described by the Iranians as a cruise missile capable of destroying large American air carriers with a single hit.
Tuesday, this claim proved to be the prologue in advance of Iran’s virtual closure of the Strait of Hormuz against the return of the USS Stennis into the Persian Gulf and appropriation of its “right” to open and close the waterway at will.

It is hard to see the Obama administration caving in to Tehran’s ultimate challenge to the freedom of this vital international waterway. The Stennis or some other American naval vessel must soon be sent through the Strait of Hormuz to test Iran’s assumption of control.
Gen. Salehi said: “We are not seeking to act irrationally, but are ready to confront any threat.” Another Iranian commander said that Iran’s Revolutionary Guards are preparing another military exercise in the Persian Gulf. He did not offer a date.

Our military sources add that two more American warships, the USS Bataan and USS Makin Island, are cruising in the area. They are small Marine Corps amphibian craft carrying jets and helicopters. The big air craft carrier USS Carl Vinson, deployed in the Pacific from the third week of December, is on standby to advance to waters opposite Iran in an emergency. 

Iran has embarked on “activities related to possible weaponization,” said American sources Wednesday, Dec. 22, thereby accounting for the dramatic reversal of the Obama administration’s wait-and-see attitude on attacking Iran. The change  was articulated this week by US Defense Secretary Leon Panetta and Chairman of the Joint US Chiefs of Staff Gen. Martin Dempsey. debkafile‘s Washington sources report that the Islamic Republic crossed the red line President Barack Obama had set for the United States, i.e., when Tehran begins using the technologies and fissile materials (enriched uranium) it has amassed for assembling a bomb or missile warheads.  This marks the moment that Iran goes nuclear and only a short time remains before it has an operational nuclear weapon. Washington has always claimed that when the order to build a weapon was given in Tehran, the United States would know about it within a short time. The US stealth drone RQ-170 was sent into Iranian airspace for the first time to find evidence to support this suspicion. On Dec. 4 the Iranians downed the unmanned reconnaissance craft by intelligence or cyber means not yet fully clarified. The US – and most probably Israel too – then turned to other intelligence resources to find out what Iran was up to. According to debkafile‘s military and intelligence sources, they found evidence that Iran has in fact begun putting together components of a nuclear bomb or warhead.

This discovery prompted the latest statements by Mr. Panetta and Gen. Dempsey.

The defense secretary put it into words when he said Tuesday, Dec.: “Despite the efforts to disrupt the Iranian nuclear program, the Iranians have reached a point where they can assemble a bomb in a year or potentially less.”

The next day, Gen. Dempsey said, “My biggest worry is they will miscalculate our resolve. Any miscalculation could mean that we are drawn into conflict, and that would be a tragedy for the region and the world.”

Dennis Ross, until last month President Obama’s senior Middle East adviser, and key architect of White House policies on the Iranian nuclear program and understandings with Israel on this issue, said  Israel has four causes for concern about uranium enrichment in the underground nuclear facility at Fordo near Qom and other developments:

1.  Iran’s accumulation of low-enriched uranium, its decision to enrich to nearly 20 percent “when there is no justification for it.”

2.  The “hardening” of Iranian nuclear sites, largely by moving facilities underground.

3.  Other activities related to possible weaponization.

4.  Israel suspects that Fordo is not Iran’s only buried facility and that nuclear “weaponization” is ongoing surreptitiously at additional underground locations. “I would not isolate Qom and say this alone is the Israeli red line to spur a military response.”

Our military sources report that all these developments were covered in the short and epic conversation between President Barack Obama and Israeli Defense Minister Ehud Barak at the Gaylord Hotel in Maryland on Dec. 16. It ended with accord on the US and Israeli responses to the new situation arising in Iran.

The White House has since accepted the Israeli assessment of Iran’s nuclear bomb time table and endorses the conviction that unless Iran retreats from its decision to build a nuclear bomb and steps back from the process it set in train this month, the only option remaining will be a military strike to disable its nuclear program. Following the Maryland encounter, debkafile’s sources report a procession of prominent US officials visiting Israel to tighten coordination between the US and Israel on their next moves. Lt. Gen. Frank Gorenc, commander of the US’s Third air Force, was one of those visitors. He came to organize the biggest joint military exercise ever held by the US and Israel, as part of the shared response to Iran’s steps.

Tuesday, Dec. 20, saw the arrival of Undersecretary of State Wendy Sherman, Secretary of State Hillary Clinton’s right-hand, together with Robert Einhorn, a State Department special adviser on nonproliferation. The two came to tie up the diplomatic ends of the decisions reached by President Obama and Defense Minister Barak at their meeting in Washington.

“Despite the efforts to disrupt the Iranian nuclear program, they have reached a point where they can assemble a bomb in a year or potentially less,” said US Secretary of Defense Leon Panetta in a CBS interview Tuesday, Dec. 20, marking a radical change in US administration policy, he added: “That’s a red line for us and that’s a red line, obviously for the Israelis. If we have to do it we will deal with it.”

debkafile notes that as recently as Dec. 2, the US defense secretary in a lecture at the Brookings Institute in Washington warned Israel that a military attack on Iran’s nuclear facilities would hold back its bomb program by no more than a year or two and seriously damage the world economy. He said then that a nuclear-armed Iran would be an existential concern for Israel, but the red line for America would be the disruption of Persian Gulf oil trade.
In the CBS interview he gave on his way back from trips to Iraq, Afghanistan and Libya, he drew no distinctions between America and Israel on the Iran issue.
Asked by anchor Scott Pelley if Iran could have a nuclear weapon in 2012, he answered: “It would probably be about a year before they can do it. Perhaps a little less.” That would depend on their having “a hidden facility somewhere in Iran that may be enriching fuel.”

Pelley then asked: If the Israelis decide to launch a military strike to prevent that weapon from being built, what sort of complications does that raise for you?

Panetta: We share the same common concern. The United States does not want Iran to develop a nuclear weapon. That’s a red line for us and that’s a red line, obviously, for the Israelis. If we have to do it we will deal with it.

Asked if “it” included military steps, the US defense secretary replied: There are no options off the table. A nuclear weapon in Iran is unacceptable.
He added that he has no indication yet that the Iranians have made the decision to go ahead.
Until now, debkafile‘s Washington sources note, the Obama administration stood firmly by sanctions, which could be made tougher, as the only course of action for putting the brakes on Iran’s weapons program.

However, Panetta made no mention of sanctions in this interview – not even of the ultimate penalties of an embargo on its oil trade and blacklisting its central bank.
debkafile‘s intelligence sources link this radical change of posture, and its implied open door to joint US-Israeli military action, to the discussion on the Iranian nuclear issue President Barack Obama had with Israeli Defense Minister Ehud Barak in Washington last Friday, Dec. 16. It took place at about the same time as Leon Panetta was meeting with Turkish leaders in Ankara. (The night before, the Turkish military council met urgently to review preparations for war hostilities on two fronts: Syria and Iran.)
Both meetings, say debkafile‘s Washington sources, addressed the reality of Iran having a nuclear bomb within months.

The administration’s change of course finds expression in six areas:
1.  Panetta has tossed aside the various intelligence estimates of a three-to-four year timeline for Iran to have a nuclear bomb. He now accepts that Tehran may be only months away from this target.
2.  His reference to “a hidden facility somewhere in Iran that may be enriching fuel” reflects the growing conviction among Western and Middle East intelligence experts that Iran has fast-tracked its high-grade uranium enrichment in underground facilities.
3.  He is no longer warning Israel against attacking Iran and appears to be taking the opposite tack: We must stop Iran crossing the shared red line to an “unacceptable” nuclear weapon. “If we have to do it we will deal with it,” he said, referring to the military option.

4. It is the last moment for the US to avert the Middle East’s plunge into a nuclear race.

Dec. 5, the former Saudi intelligence chief, Prince Turki al-Faisal said that after failing to persuade Israel and Iran to give up their nuclear weapons, Riyadh had no option but to develop its own; and Turkish leader have been saying to the  Obama administration that if Iran has a nuclear weapon, so too will Turkey.
The administration is now facing the bleak realization that a disastrous nuclear race in this volatile region can be deflected only by military action to cut down and destroy Iran’s nuclear weapons program.

5.  Iran’s capture of the American RQ-170 stealth drone on Dec. 4 brought home to US military and intelligence planners that a military showdown between the US and Iran is no longer avoidable and if America does not take the initiative, Iran will keep on driving it into corners until there is no other option but to hit back.
6.  The sudden death of the North Korean leader Kim Jong II and the period of uncertainty facing his successor Kim Jong-un could potentially lead to Pyongyang – or factions fighting for power – stepping up its involvement in Iran’s nuclear weapon and missile development programs.

Turkish Prime Minister Recep Tayyip Erdogan emphatically denies reports he is suffering from cancer, but Obama is worried.

Western intelligence sources told DebkaFile Sunday that Erdogan is suffering from rectosigmoid cancer, but it is not known what stage the disease has reached.

The Turkish daily Today’s Zaman reported last week that Health Minister Recep Akdağ said, “Our prime minister is in good health, but we recommended he gets some rest following recent laparoscopic surgery.”

His condition forced him to cancel a scheduled visit to Qatar last week. Erdogan has been unusually quiet and out of the public eye since his surgery on November 26, but official photographs show him smiling and hosting foreign officials the same day.

Despite the denials that Erdogan has cancer, officials have given no explanation why he was being treated in a special room. Erdogan is usually featured in Turkish newspapers almost every day, but he has been conspicuously absent from the pages of two of Turkey’s most popular dailies, Today’s Zaman and Hurriyet.

His prolonged absence from public life and his “rest” outside of the capital of Ankara is worrying the Obama administration, especially in view of the instability in Syria, according to DebkaFile’s sources. If Iranian President Mahmoud Ahmadinejad directly involves Iran in the Syrian crisis, Turkey’s response could be critical to further developments in the Middle East.

President Obama regards Erdogan as a friend and reportedly has spoken with him on the phone at least 14 times this year.

With Erdogan away from the capital, signs have grown of a power struggle within his ruling party.