P a g e | 1

NEMESIS OIL AND MISSILES IN THE 21st CENTURY

ldquoThe country that faced down the tyranny of fascism and communism is now called to challenge the tyranny of oilrdquo Barack Obama Detroit Economic Club May 2007

Introduction

Strangulation of the lsquoumbilical cordrsquo our essential global oil supply conduit from the Arabian Gulf to major oil-consuming nations in SE Asia could gradually choke out our life on our vulnerable planet Are we already doomed

This paper undertakes a brief historical analysis as to how oil supply contingency was initially perceived mentions the Oil Tanker War and discusses the global oil supply chain The paper focuses on the increasing militarism amongst those oil consumer nations dependent largely upon Middle East hydrocarbons supply The oil consumer nations discussed include India Taiwan Japan and South Korea The ldquoArab Springrdquo is highlighted together with an abbreviated analysis of the civil war in Syria The paper reviews the missile and anti-missile shield arms race and the geopolitical economic and military implications for the West before the end of the 21st Century Chinese perspectives are stated analysed and broadly critiqued Cursory findings and conclusions are advanced including suggested reforms to the United Nations Security Council (UNSC)

Recent history has portrayed the never ending struggle for oil supply In earlier times the battle for oil supply amongst competing oil-consumer nations was often backed up by intrusive gunboat diplomacy and naval blockade Today it is under a much greater threat from missile deployments and from high speed offshore patrol vessels (OPV) armed with limited-theatre anti-ship missiles (ASBM) and other sophisticated weapons

Anti-West nationalistic political leaders deliberately disrupted oil supply in the past These included Mohammad Mosaddegh (nationalised the Anglo-Iranian Oil Company May 1951) Gamal Nasser (nationalised and closed the Suez Canal July 1956) Saddam Hussein (seized international oil interests later precipitating the lsquo1973 energy crisisrsquo June 1972) and Muammer Gaddafi (nationalised Libyarsquos oil industry September 1973) These despotic Islamic leaders were once linked by an often expressed common sentiment ldquoThe imperialistic West is stealing our oilrdquo

Today Mahmoud Ahmadinejad menaces the West with potential nuclear proliferation and threatens to block the Strait of Hormuz1 North Korea threatens oil deliveries to Japan and South Korea with new SRBM missiles China disputes newly discovered oil and gas reserves undersea in the Nan Hai and Dong Hai

1 See Crash_Watcher ldquoIf the Strait of Hormuz Closed Which Oil Importing Region Would Suffer the Greatest Lossrdquo Wednesday 18 July 2012 See also ldquoStrait Answer Iran prepares to close Hormuzrdquo on tvglobalresearchca (RTV video interview and article) Google search on title 3 July 2012

P a g e | 2

Oil diplomacy will continue into the future and beyond the end of the 21st Century

In the Middle East the Gulf littoral Arab oil-producing states largely unencumbered by political intransigence in the past include Bahrain Kuwait (except for a brief Iraqi occupation period) Oman Saudi Arabia Qatar and the UAE

Oil supply from the Arabian Gulf to Europe and the North American continent is not discussed in this paper These oil supply routes are relatively free from political transgression terrorist or military action apart from sporadic piracy off Somalia in the northern Indian Ocean and from past closure of the Suez Canal Nonetheless if the Strait of Hormuz is blocked then very little Middle East oil would get through to Europe and North America

Historical Analysis

Professor Geoffrey Kemp in his ldquoLimited Contingency Studyrdquo at the Pentagon first recognised this fundamental problem in 1976 The encroachment of Soviet military bases in Cuba Guinea Guinea Bissau St Helena and Mozambique new bases close to the Strait of Hormuz Maldive Islands and elsewhere sent strategic shivers through defense analysts Between 1965 and 1975 the Soviet military juggernaut lsquoupstart-strongholdsrsquo (built quickly unexpectedly to thus catch the West by surprise) at so many diverse locations severely tested the patience of Western military analysts

These locations are depicted in a book entitled ldquoThe Communist Challenge to Africardquo authored by Ian Greig2 The relevant maps are detailed at the beginning of the first Chapter The maps detail the locations of the Soviet bases positioned adjacent to the major sea routes for the transit of crude oil

In 1978 President Jimmy Carterrsquos ldquoWorld Energy Crisisrdquo Campaign had begun in earnest The Campaign in reality continues today and will effectively continue for many decades to come It will vacillate frequently in tune to the insatiable demand-driven thirsty oil consumer nations and the worldrsquos economic climate

Suffice to say in 1979 a Soviet cruiser took up station in the Gulf of Oman Soviet warship deployments had entered the Indian Ocean to effectively replace the former presence of the omnipotent British Navy Soviet maritime intentions were clear

In the same year Ayatollah Khomeini threatened to put the US hostages captured at the US Embassy in Tehran on trial as spies President Carter immediately warned the Iranian Government through back channels that if any such ldquotrialsrdquo took place Iran would suffer dire consequences To back up his threat Carter ordered an aircraft carrier battle group to take up station off the coast of Iran The USS ldquoKitty Hawkrdquo (CV-63) joined with another aircraft carrier already on station the USS ldquoMidwayrdquo (CVB-41) to form one of the largest US naval forces ever to be assembled in the region

2 Greg Ian ldquoThe Communist Challenge to Africardquo Foreign Affairs Publishing Company 1977 ISBN 0 900380217

P a g e | 3

Further retaliation by the West was immediate Mirror image naval bases with upgraded infrastructure were quickly positioned at Bahrain Diego Garcia Djibouti Seychelles and elsewhere US pre-positioning strategy for materiel soon became the norm Rapid response initiatives were put into place For the first time since the phased withdrawal of the UKrsquos military presence east of Suez3 British warships were deployed on permanent station in the Gulf of Oman

Many believed a Soviet encirclement of the Middle East oilfields was imminent The Soviet invasion of Afghanistan reinforced this sagacious perception Today military analysts perceive the long term objective of the Sino-Russian bloc is to encircle and capture the same vital oilfields

In 1979 the future air-sea-battle lines were drawn athwart oil supply routes

These routes were around the Cape of Good Hope in the Arabian Gulf the northern Indian Ocean and further afield in the southern Atlantic The largest-volume oil routes were westward to North America and Europe Significantly less oil (conservatively estimated at roughly 28 of that shipped to Europe and the US) was shipped eastward to ASEAN countries Australasia India Pakistan Japan and China Chinarsquos oil consumption was not high relatively as most of the oil shipped eastward was to support manufacturing activity in Japan The latter was at the time destined to become the worldrsquos second-largest net oil importer

Oil Tanker War (1984-88)

The oil battle was joined in September 1984

Oil supply military interdiction first occurred when Iraqi aircraft attacked the oil terminal and Iranian tankers at Kharg Island The hitherto unexpected lsquoGulf Tanker Warrsquo broke out catching the West by surprise and was to last for some four desperate years until July 1988 Sometimes it is called the ldquoforgottenrdquo war largely because it was overlooked by military historians as a subsidiary war hidden within the much larger Iraq-Iran conflict

Oil tankers were steaming at full speed through the Strait of Hormuz (ldquoSuicide Alleyrdquo) at the rate of one tanker every two minutes4 In the upper reaches of the Arabian Gulf the multi-nation tankers including Kuwaiti tankers protected by the American flag dodged Exocet missiles hostile gunboats Boghammar fast patrol boats and sea mines Several oil tankers were damaged including the supertanker al-Rekkah renamed as the Bridgeton which struck a mine whilst in a northbound convey

Air-to-ship missiles used in the Tanker War included eight categories of missiles namely the French Exocet (AM-39) the US Harpoon (AGM-84A) and Maverick (AGM-65BC) and the Soviet Kipper (AS-2) Kitchen (AS-4) Kelt (AS-5) Kingfish (AS-6) and Sea Killer Many tankers received direct and tangential hits It was a miracle only three oil tankers were abandoned and declared total losses Nonetheless on less damaged tankers crew members were killed or badly injured

3 British phased military withdrawal commenced in 1968 thus abandoning the Arabian Gulf and Indian Ocean4 Some 80 or 90 merchant ships were daily transiting the Strait of Hormuz

P a g e | 4

and numerous fires occurred in engine rooms Fortunately the fires were quickly brought under control

In total between 1984 and 1987 an estimated 259 oil tankersproduct carriers and 52 cargofreighter vessels were attacked Another 39 vessels including tugs were also attacked It is amazing that only a mere 2 to 4 of the total shipping traffic (estimate) in the Arabian Gulf was sunk (total loss) in spite of the constant rain down of missiles during the war

At the height of hostilities four US Navy carrier battle groups were rotated in the region These were the ldquoRangerrdquo (CV-61) and ldquoMidwayrdquo (CVB-41) in the Bay of Bengal and the ldquoEnterpriserdquo (CVN-65) and ldquoForrestalrdquo (CV-59) in the Arabian Sea

The media immediately drew world attention to the emergency and its projected consequences for the West

Chinese involvement in the Tanker War soon manifested itself Towards the end of the war China supplied around three hundred HY-2 ldquoSilkwormrdquo anti-ship missiles to Iran This missile has a 96 km range and carries a 450 kg explosive warhead It is a Chinese version of the Soviet ldquoStyxrdquo anti-ship missile Iran unashamedly used these missiles against Kuwaiti tankers and offshore oil platforms

Threat Analysis

The Gulf Tanker War is a dire warning as to what may happen on a wider scale later this century in other oil chokepoints around the world In 2011 total world oil production amounted to approximately 87 million barrels per day (MMbbld) and over one-half was moved by tankers on fixed maritime routes By volume of oil transit the Strait of Hormuz leading out of the Arabian Gulf and the Strait of Malacca linking the Indian and Pacific Oceans are two of the worldrsquos most strategic chokepoints Other chokepoints are the Bab el-Mandab (Red Sea) Suez Canal and SUMED Relief Pipeline Turkish Straits Danish Straits and Panama Canal

Global oil supply is obviously vulnerable Impediments military or otherwise to oil tankers transiting the seven world chokepoints will serve to reduce oil flow through the umbilical cord World oil chokepoints for maritime transit of oil are a critical part of global energy security (US Energy Information Administration)

Iran has often threatened to block the Strait of Hormuz During the Tanker War Iran laid magnetic mines in the Arabian Gulf attacked Iraqi warships and oil installations

Worst Case Scenarios

At this juncture it is useful to describe a couple of worst case scenarios

ldquoA lsquoblockshiprsquo or lsquofireshiprsquo such as an innocuous looking dredge or barge flying a disarming flag of convenience devoid of the correct international code signals or flags displaying phony navigation lights at nighttime loaded with high explosives mines or destructive ordnance towed by a powerful tug suddenly and unexpectedly positioned in the direct path of an unsuspecting outgoing fully laden ULCC unable to change course quickly enough in the narrow channel to avoid a collision The

P a g e | 5

resultant conflagration and fireball is the worst possible outcome Such a heinous act is not beyond the present day capability of insurgents political dissidents or a rogue staterdquo

ldquoAnother potential scenario could be an old WWII submarine or present day Yono Class midget submarine clandestinely positioned without detection by depth finder or radar to lie innately and inconspicuously on the bottom of the shallowest part of the channel likewise loaded with high explosives set to ascend using remote control radio signals under the keel of a passing ULCC Such interdiction is not beyond the capability of those determined to disrupt oil supply to the Westrdquo

There are many other options ndash surface or sub-surface UASs modern midget or normal electric submarines aircraft or airborne RPV suicide collision and others Iran may possess secret weapons unknown to the West

Mankind has often demonstrated gross wanton destruction using the slightest of political whims as an unforgivable weak excuse History tells us so We may well pray that these scenarios might never eventuate

From the Iranian point of view the operational success or otherwise of these postulated worst case scenarios will greatly depend upon the viability of Western detection methods For instance those vested in Omani offshore patrol vessels (OPV) and helicopter surveillance together with regular channel sweeps conducted by US naval assets attached to the US Fifth Fleet on patrol from NSA Bahrain Detection methods which could also concern the Iranian Navy include new electronic detection methodologies undertaken by using RSAFUSAF airborne AWACS 5

The eyes of the world are now and forever cast upon the Strait of Hormuz Approximately forty per cent of the worldrsquos oil supply transits the Strait Every intelligence officer is sadly remiss if unable to understand the implications for the West The logistics of global oil supply are at stake Never before in the history of mankind has there been such an urgent (energy) issue

However it may be virtually impossible for terrorists pirates political groups or rogue nations to interdict oil supply in the Strait without early detection by the West

Missile Threat

Notwithstanding this assertion it can be said no amount of maritime surveillance can protect oil tankers from the ultimate missile threat especially if the warheads are nuclear In view of the lessons learnt from the Oil Tanker War the question is whether Iran (or North Korea) is irresponsible enough to use these deadly weapons to greater destructive effect with no regard for maintaining world peace The Islamic Republic of Iran Navy (IRIN) and the Islamic Revolutionary Guard Corps Navy (IRGCN) now have an estimated thirteen classes of missile6 China Russia and

5The Royal Saudi Air Force (RSAF) using 5X Boeing 707 modified E-3 Sentry aircraft and the United States Air Force (USAF) both undertake AWACS surveillance of maritime sources in the Arabian Gulf Strait of Hormuz and Gulf of Oman These assets are based at Prince Sultan Air Base (Al Kharj) and Al Udeid Air Base (Doha) respectively6 Iranrsquos missiles include Nasr 1 and 2 Victory battlefield range ballistic missile (BRBM) virtually identical to the C704 Chinese supplied cruise missile Rarsquod Thunder SS N 22 Sunburn P270 Moskit Ghadir Fateh-110 Mehrab (Altar) Meshkat (Lantern) NoorYinji (Hawk) C-8012 ASBM Seersucker CSS-C-2 Qader (Mighty) Zafar and

P a g e | 6

North Korea have combined to supply Iranrsquos missiles7 Iran continues to insist its defence doctrine is based upon deterrence

Potentially North Korea is able to interdict oil deliveries to Taiwan Japan and South Korea using offensive missile strikes

A number of latent thoughts arise at this juncture

Russia has abundant oil Iran currently needs to sell oil to defeat international embargoes China needs to buy large quantities of Middle East oil including from Iran If and when China obtains sufficient quantities of additional oil from Russia (Siberian crude) from the Caspian Region from Africa Venezuela or elsewhere then China will be correspondingly less dependent upon oil sourced from the Arabian Gulf littoral In the longer term ceteris paribus China with support from Russia could conceivably encourage Iran to block the Strait of Hormuz

This argument is probably fallacious

If China obtained sufficient oil coming from elsewhere and it does not need oil from the Arabian Gulf then why would Iran cede to China to block the Strait of Hormuz Obviously Iran still needs to export oil to generate income or to meet its internal domestic public sector expenditures If the Strait is blocked Iran will be unable to export much of its oil production Pipelinesroad tankers alone will not suffice

The US is reducing its dependence upon Middle East oil (recently estimated at close to 30 per cent once new pipelines and infrastructure come on stream)

Oil Volumes Transited Today

Tonnages of oil shipped through the Strait have increased exponentially in recent years pari passu with the growth in VLCC and ULCC gigantic size tankers Although mammoths such as ldquoOriental Nicetyrdquo (ldquoExxon Valdezrdquo) ldquoSeawise Giantrdquo ldquoPierre Guillaumatrdquo ldquoBatillusrdquo Bellamyardquo and ldquoPrairialrdquo are now scrapped (many are scrapped at the Alang breakers yard in India) they have been replaced by even larger tankers For example Iran has procured the worldrsquos largest tanker (with 22 million barrels capacity) to add to its 49 tanker national fleet8 ldquoSirius Starrdquo ldquoHua Sanrdquo and ldquoYangtze Starrdquo although very large are not quite in the same class

China is building the largest oil tanker fleet in the world (Poten and Partners Houston TX) and the worldrsquos largest merchant marine navy

Increased oil tonnages have greatly hastened the lsquopulse throb and flowrsquo of crude oil passing through the umbilical cord global oil supply

Changes in Volume Oil Supply

Nour (Light) Some of these are nuclear capable Some were successfully tested during the Velayat 91 naval manoeuvres held December 2012 The Nour missile can be launched from an estimated fleet of 10000 plus speedboats constituting a hard to defend ldquoswarm attackrdquo on Western transit shipping China has opened a missile production plant facility in Iran for the mass production of the Nasr 1 missile Iran is building a secret missile installation in Venezuela7 Lincy Valerie ldquoMore Talks with Iran set for Januaryrdquo Iran Watch Status Report Wisconsin Project on Nuclear Arms Control 1701 K Street NW Suite 805 Washington DC December 2012 8 Recently built in China (Internet source)

P a g e | 7

Today the prevailing exigencies associated with the need for consistent global oil supply have greatly increased the volume of oil transported worldwide for immediate consumption and for government strategic reserves China has overtaken Japan and is now the worldrsquos second largest net oil importer The US still the number one net importer has retreated somewhat and desires to become self-sufficient in hydrocarbons supply (using new technology to extract ldquokerogenrdquo not actually oil but an organic matter from indigenous shale oilfields)

The US long recognising its own vulnerability to sustained oil supply from the Middle East is now determined to reduce its dependence upon imported oil Increased prospecting and oil exploration activities are on the US mainland9 The US is also looking to Canada for sources of new oil supply (known as lsquoTight Oilrsquo) such as from new shale oil fields using improved extraction technology These new oil fields include the New Brunswick Albert and Devonian Kettle Point Formations and the lesser known Ordovician Collingwood Shale The shale oil boom has given the US the means to slash its oil import dependency using the new Keystone XL pipeline delivering substantial crude from carbon-heavy Canadian tar sands

US crude oil production is set to rise to its highest level in 25 years by 201410

A note of caution prevails here David Hughes an independent geologist has written an exhaustive 178-page research paper published by the Post Carbon Institute in February 2013 The paper examines 65000 existing US shale and gas wells The main finding is thus ldquo the challenges and costs of 21st Century fossil fuel production suggest that vastly increased supplies will not be easily achieved or even possiblerdquo11 Similarly research by the US Geological Survey casts doubt upon wildly optimistic production assumptions relied on by listed US companies when raising equity and debt capital

Gervaise Heddle a little-known Australian investor has circulated a private report claiming that US shale companiesrsquo profits bear little relation to actual cash earnings Heddle states ldquoEvery model of US growth has been tweaked to recognise the accepted lsquofactrsquo that shale oil will rescue North America from its indebtedness If the new shale oil and gas drilling techniques are genuinely a revolution that will unlock boundless energy itrsquos fair to assume that the companies capitalising on them can generate attractive cash returns But the evidence suggests otherwiserdquo

9 Innovative drilling technology has greatly improved US prospects for indigenous oil production ldquoThe Octopusrdquo multi-well pad drilling system is up to eight times faster than conventional methods The US may eclipse Saudi oil production by 2015 or earlier US crude imports have already fallen by 11 per cent US based exploration companies include Continental Resources Brigham Exploration Devon Energy EnCana and North Dakota Mineral Resources Some of these companies are operating on the Bakken shale oilfield Cost per well using multi-pad technology is reduced to U$25M from the conventional cost of US$6M Source ldquoOil and Gas Traderrdquo downloaded Monday 3 June 2013 (1030 hrs AEST Australia)NOTES (a) The US anticipates total world oil production dominance by (say) 2025 or earlier (b) Also refer to the report entitled ldquo550 Windfall from Bakken Octopus Technologyrdquo produced by the ldquoOil and Gas Traderrdquo in 2013 (c) It is perceived by some that Saudi Arabia will cease exporting oil by 2030 Further research is needed10 Potter Ben The Australian Financial Review Thursday 10 January 2013 wwwafrcom 11 ldquoThe real oil on US shale may be elusiverdquo press article written by Christopher Joyce Smart Money rdquoThe Australian Financial Reviewrdquo 25-26 May 2013 wwwafrcom

P a g e | 2

Oil diplomacy will continue into the future and beyond the end of the 21st Century

In the Middle East the Gulf littoral Arab oil-producing states largely unencumbered by political intransigence in the past include Bahrain Kuwait (except for a brief Iraqi occupation period) Oman Saudi Arabia Qatar and the UAE

Oil supply from the Arabian Gulf to Europe and the North American continent is not discussed in this paper These oil supply routes are relatively free from political transgression terrorist or military action apart from sporadic piracy off Somalia in the northern Indian Ocean and from past closure of the Suez Canal Nonetheless if the Strait of Hormuz is blocked then very little Middle East oil would get through to Europe and North America

Historical Analysis

Professor Geoffrey Kemp in his ldquoLimited Contingency Studyrdquo at the Pentagon first recognised this fundamental problem in 1976 The encroachment of Soviet military bases in Cuba Guinea Guinea Bissau St Helena and Mozambique new bases close to the Strait of Hormuz Maldive Islands and elsewhere sent strategic shivers through defense analysts Between 1965 and 1975 the Soviet military juggernaut lsquoupstart-strongholdsrsquo (built quickly unexpectedly to thus catch the West by surprise) at so many diverse locations severely tested the patience of Western military analysts

These locations are depicted in a book entitled ldquoThe Communist Challenge to Africardquo authored by Ian Greig2 The relevant maps are detailed at the beginning of the first Chapter The maps detail the locations of the Soviet bases positioned adjacent to the major sea routes for the transit of crude oil

In 1978 President Jimmy Carterrsquos ldquoWorld Energy Crisisrdquo Campaign had begun in earnest The Campaign in reality continues today and will effectively continue for many decades to come It will vacillate frequently in tune to the insatiable demand-driven thirsty oil consumer nations and the worldrsquos economic climate

Suffice to say in 1979 a Soviet cruiser took up station in the Gulf of Oman Soviet warship deployments had entered the Indian Ocean to effectively replace the former presence of the omnipotent British Navy Soviet maritime intentions were clear

In the same year Ayatollah Khomeini threatened to put the US hostages captured at the US Embassy in Tehran on trial as spies President Carter immediately warned the Iranian Government through back channels that if any such ldquotrialsrdquo took place Iran would suffer dire consequences To back up his threat Carter ordered an aircraft carrier battle group to take up station off the coast of Iran The USS ldquoKitty Hawkrdquo (CV-63) joined with another aircraft carrier already on station the USS ldquoMidwayrdquo (CVB-41) to form one of the largest US naval forces ever to be assembled in the region

2 Greg Ian ldquoThe Communist Challenge to Africardquo Foreign Affairs Publishing Company 1977 ISBN 0 900380217

P a g e | 3

Further retaliation by the West was immediate Mirror image naval bases with upgraded infrastructure were quickly positioned at Bahrain Diego Garcia Djibouti Seychelles and elsewhere US pre-positioning strategy for materiel soon became the norm Rapid response initiatives were put into place For the first time since the phased withdrawal of the UKrsquos military presence east of Suez3 British warships were deployed on permanent station in the Gulf of Oman

Many believed a Soviet encirclement of the Middle East oilfields was imminent The Soviet invasion of Afghanistan reinforced this sagacious perception Today military analysts perceive the long term objective of the Sino-Russian bloc is to encircle and capture the same vital oilfields

In 1979 the future air-sea-battle lines were drawn athwart oil supply routes

These routes were around the Cape of Good Hope in the Arabian Gulf the northern Indian Ocean and further afield in the southern Atlantic The largest-volume oil routes were westward to North America and Europe Significantly less oil (conservatively estimated at roughly 28 of that shipped to Europe and the US) was shipped eastward to ASEAN countries Australasia India Pakistan Japan and China Chinarsquos oil consumption was not high relatively as most of the oil shipped eastward was to support manufacturing activity in Japan The latter was at the time destined to become the worldrsquos second-largest net oil importer

Oil Tanker War (1984-88)

The oil battle was joined in September 1984

Oil supply military interdiction first occurred when Iraqi aircraft attacked the oil terminal and Iranian tankers at Kharg Island The hitherto unexpected lsquoGulf Tanker Warrsquo broke out catching the West by surprise and was to last for some four desperate years until July 1988 Sometimes it is called the ldquoforgottenrdquo war largely because it was overlooked by military historians as a subsidiary war hidden within the much larger Iraq-Iran conflict

Oil tankers were steaming at full speed through the Strait of Hormuz (ldquoSuicide Alleyrdquo) at the rate of one tanker every two minutes4 In the upper reaches of the Arabian Gulf the multi-nation tankers including Kuwaiti tankers protected by the American flag dodged Exocet missiles hostile gunboats Boghammar fast patrol boats and sea mines Several oil tankers were damaged including the supertanker al-Rekkah renamed as the Bridgeton which struck a mine whilst in a northbound convey

Air-to-ship missiles used in the Tanker War included eight categories of missiles namely the French Exocet (AM-39) the US Harpoon (AGM-84A) and Maverick (AGM-65BC) and the Soviet Kipper (AS-2) Kitchen (AS-4) Kelt (AS-5) Kingfish (AS-6) and Sea Killer Many tankers received direct and tangential hits It was a miracle only three oil tankers were abandoned and declared total losses Nonetheless on less damaged tankers crew members were killed or badly injured

3 British phased military withdrawal commenced in 1968 thus abandoning the Arabian Gulf and Indian Ocean4 Some 80 or 90 merchant ships were daily transiting the Strait of Hormuz

P a g e | 4

and numerous fires occurred in engine rooms Fortunately the fires were quickly brought under control

In total between 1984 and 1987 an estimated 259 oil tankersproduct carriers and 52 cargofreighter vessels were attacked Another 39 vessels including tugs were also attacked It is amazing that only a mere 2 to 4 of the total shipping traffic (estimate) in the Arabian Gulf was sunk (total loss) in spite of the constant rain down of missiles during the war

At the height of hostilities four US Navy carrier battle groups were rotated in the region These were the ldquoRangerrdquo (CV-61) and ldquoMidwayrdquo (CVB-41) in the Bay of Bengal and the ldquoEnterpriserdquo (CVN-65) and ldquoForrestalrdquo (CV-59) in the Arabian Sea

The media immediately drew world attention to the emergency and its projected consequences for the West

Chinese involvement in the Tanker War soon manifested itself Towards the end of the war China supplied around three hundred HY-2 ldquoSilkwormrdquo anti-ship missiles to Iran This missile has a 96 km range and carries a 450 kg explosive warhead It is a Chinese version of the Soviet ldquoStyxrdquo anti-ship missile Iran unashamedly used these missiles against Kuwaiti tankers and offshore oil platforms

Threat Analysis

The Gulf Tanker War is a dire warning as to what may happen on a wider scale later this century in other oil chokepoints around the world In 2011 total world oil production amounted to approximately 87 million barrels per day (MMbbld) and over one-half was moved by tankers on fixed maritime routes By volume of oil transit the Strait of Hormuz leading out of the Arabian Gulf and the Strait of Malacca linking the Indian and Pacific Oceans are two of the worldrsquos most strategic chokepoints Other chokepoints are the Bab el-Mandab (Red Sea) Suez Canal and SUMED Relief Pipeline Turkish Straits Danish Straits and Panama Canal

Global oil supply is obviously vulnerable Impediments military or otherwise to oil tankers transiting the seven world chokepoints will serve to reduce oil flow through the umbilical cord World oil chokepoints for maritime transit of oil are a critical part of global energy security (US Energy Information Administration)

Iran has often threatened to block the Strait of Hormuz During the Tanker War Iran laid magnetic mines in the Arabian Gulf attacked Iraqi warships and oil installations

Worst Case Scenarios

At this juncture it is useful to describe a couple of worst case scenarios

ldquoA lsquoblockshiprsquo or lsquofireshiprsquo such as an innocuous looking dredge or barge flying a disarming flag of convenience devoid of the correct international code signals or flags displaying phony navigation lights at nighttime loaded with high explosives mines or destructive ordnance towed by a powerful tug suddenly and unexpectedly positioned in the direct path of an unsuspecting outgoing fully laden ULCC unable to change course quickly enough in the narrow channel to avoid a collision The

P a g e | 5

resultant conflagration and fireball is the worst possible outcome Such a heinous act is not beyond the present day capability of insurgents political dissidents or a rogue staterdquo

ldquoAnother potential scenario could be an old WWII submarine or present day Yono Class midget submarine clandestinely positioned without detection by depth finder or radar to lie innately and inconspicuously on the bottom of the shallowest part of the channel likewise loaded with high explosives set to ascend using remote control radio signals under the keel of a passing ULCC Such interdiction is not beyond the capability of those determined to disrupt oil supply to the Westrdquo

There are many other options ndash surface or sub-surface UASs modern midget or normal electric submarines aircraft or airborne RPV suicide collision and others Iran may possess secret weapons unknown to the West

Mankind has often demonstrated gross wanton destruction using the slightest of political whims as an unforgivable weak excuse History tells us so We may well pray that these scenarios might never eventuate

From the Iranian point of view the operational success or otherwise of these postulated worst case scenarios will greatly depend upon the viability of Western detection methods For instance those vested in Omani offshore patrol vessels (OPV) and helicopter surveillance together with regular channel sweeps conducted by US naval assets attached to the US Fifth Fleet on patrol from NSA Bahrain Detection methods which could also concern the Iranian Navy include new electronic detection methodologies undertaken by using RSAFUSAF airborne AWACS 5

The eyes of the world are now and forever cast upon the Strait of Hormuz Approximately forty per cent of the worldrsquos oil supply transits the Strait Every intelligence officer is sadly remiss if unable to understand the implications for the West The logistics of global oil supply are at stake Never before in the history of mankind has there been such an urgent (energy) issue

However it may be virtually impossible for terrorists pirates political groups or rogue nations to interdict oil supply in the Strait without early detection by the West

Missile Threat

Notwithstanding this assertion it can be said no amount of maritime surveillance can protect oil tankers from the ultimate missile threat especially if the warheads are nuclear In view of the lessons learnt from the Oil Tanker War the question is whether Iran (or North Korea) is irresponsible enough to use these deadly weapons to greater destructive effect with no regard for maintaining world peace The Islamic Republic of Iran Navy (IRIN) and the Islamic Revolutionary Guard Corps Navy (IRGCN) now have an estimated thirteen classes of missile6 China Russia and

5The Royal Saudi Air Force (RSAF) using 5X Boeing 707 modified E-3 Sentry aircraft and the United States Air Force (USAF) both undertake AWACS surveillance of maritime sources in the Arabian Gulf Strait of Hormuz and Gulf of Oman These assets are based at Prince Sultan Air Base (Al Kharj) and Al Udeid Air Base (Doha) respectively6 Iranrsquos missiles include Nasr 1 and 2 Victory battlefield range ballistic missile (BRBM) virtually identical to the C704 Chinese supplied cruise missile Rarsquod Thunder SS N 22 Sunburn P270 Moskit Ghadir Fateh-110 Mehrab (Altar) Meshkat (Lantern) NoorYinji (Hawk) C-8012 ASBM Seersucker CSS-C-2 Qader (Mighty) Zafar and

P a g e | 6

North Korea have combined to supply Iranrsquos missiles7 Iran continues to insist its defence doctrine is based upon deterrence

Potentially North Korea is able to interdict oil deliveries to Taiwan Japan and South Korea using offensive missile strikes

A number of latent thoughts arise at this juncture

Russia has abundant oil Iran currently needs to sell oil to defeat international embargoes China needs to buy large quantities of Middle East oil including from Iran If and when China obtains sufficient quantities of additional oil from Russia (Siberian crude) from the Caspian Region from Africa Venezuela or elsewhere then China will be correspondingly less dependent upon oil sourced from the Arabian Gulf littoral In the longer term ceteris paribus China with support from Russia could conceivably encourage Iran to block the Strait of Hormuz

This argument is probably fallacious

If China obtained sufficient oil coming from elsewhere and it does not need oil from the Arabian Gulf then why would Iran cede to China to block the Strait of Hormuz Obviously Iran still needs to export oil to generate income or to meet its internal domestic public sector expenditures If the Strait is blocked Iran will be unable to export much of its oil production Pipelinesroad tankers alone will not suffice

The US is reducing its dependence upon Middle East oil (recently estimated at close to 30 per cent once new pipelines and infrastructure come on stream)

Oil Volumes Transited Today

Tonnages of oil shipped through the Strait have increased exponentially in recent years pari passu with the growth in VLCC and ULCC gigantic size tankers Although mammoths such as ldquoOriental Nicetyrdquo (ldquoExxon Valdezrdquo) ldquoSeawise Giantrdquo ldquoPierre Guillaumatrdquo ldquoBatillusrdquo Bellamyardquo and ldquoPrairialrdquo are now scrapped (many are scrapped at the Alang breakers yard in India) they have been replaced by even larger tankers For example Iran has procured the worldrsquos largest tanker (with 22 million barrels capacity) to add to its 49 tanker national fleet8 ldquoSirius Starrdquo ldquoHua Sanrdquo and ldquoYangtze Starrdquo although very large are not quite in the same class

China is building the largest oil tanker fleet in the world (Poten and Partners Houston TX) and the worldrsquos largest merchant marine navy

Increased oil tonnages have greatly hastened the lsquopulse throb and flowrsquo of crude oil passing through the umbilical cord global oil supply

Changes in Volume Oil Supply

Nour (Light) Some of these are nuclear capable Some were successfully tested during the Velayat 91 naval manoeuvres held December 2012 The Nour missile can be launched from an estimated fleet of 10000 plus speedboats constituting a hard to defend ldquoswarm attackrdquo on Western transit shipping China has opened a missile production plant facility in Iran for the mass production of the Nasr 1 missile Iran is building a secret missile installation in Venezuela7 Lincy Valerie ldquoMore Talks with Iran set for Januaryrdquo Iran Watch Status Report Wisconsin Project on Nuclear Arms Control 1701 K Street NW Suite 805 Washington DC December 2012 8 Recently built in China (Internet source)

P a g e | 7

Today the prevailing exigencies associated with the need for consistent global oil supply have greatly increased the volume of oil transported worldwide for immediate consumption and for government strategic reserves China has overtaken Japan and is now the worldrsquos second largest net oil importer The US still the number one net importer has retreated somewhat and desires to become self-sufficient in hydrocarbons supply (using new technology to extract ldquokerogenrdquo not actually oil but an organic matter from indigenous shale oilfields)

The US long recognising its own vulnerability to sustained oil supply from the Middle East is now determined to reduce its dependence upon imported oil Increased prospecting and oil exploration activities are on the US mainland9 The US is also looking to Canada for sources of new oil supply (known as lsquoTight Oilrsquo) such as from new shale oil fields using improved extraction technology These new oil fields include the New Brunswick Albert and Devonian Kettle Point Formations and the lesser known Ordovician Collingwood Shale The shale oil boom has given the US the means to slash its oil import dependency using the new Keystone XL pipeline delivering substantial crude from carbon-heavy Canadian tar sands

US crude oil production is set to rise to its highest level in 25 years by 201410

A note of caution prevails here David Hughes an independent geologist has written an exhaustive 178-page research paper published by the Post Carbon Institute in February 2013 The paper examines 65000 existing US shale and gas wells The main finding is thus ldquo the challenges and costs of 21st Century fossil fuel production suggest that vastly increased supplies will not be easily achieved or even possiblerdquo11 Similarly research by the US Geological Survey casts doubt upon wildly optimistic production assumptions relied on by listed US companies when raising equity and debt capital

Gervaise Heddle a little-known Australian investor has circulated a private report claiming that US shale companiesrsquo profits bear little relation to actual cash earnings Heddle states ldquoEvery model of US growth has been tweaked to recognise the accepted lsquofactrsquo that shale oil will rescue North America from its indebtedness If the new shale oil and gas drilling techniques are genuinely a revolution that will unlock boundless energy itrsquos fair to assume that the companies capitalising on them can generate attractive cash returns But the evidence suggests otherwiserdquo

9 Innovative drilling technology has greatly improved US prospects for indigenous oil production ldquoThe Octopusrdquo multi-well pad drilling system is up to eight times faster than conventional methods The US may eclipse Saudi oil production by 2015 or earlier US crude imports have already fallen by 11 per cent US based exploration companies include Continental Resources Brigham Exploration Devon Energy EnCana and North Dakota Mineral Resources Some of these companies are operating on the Bakken shale oilfield Cost per well using multi-pad technology is reduced to U$25M from the conventional cost of US$6M Source ldquoOil and Gas Traderrdquo downloaded Monday 3 June 2013 (1030 hrs AEST Australia)NOTES (a) The US anticipates total world oil production dominance by (say) 2025 or earlier (b) Also refer to the report entitled ldquo550 Windfall from Bakken Octopus Technologyrdquo produced by the ldquoOil and Gas Traderrdquo in 2013 (c) It is perceived by some that Saudi Arabia will cease exporting oil by 2030 Further research is needed10 Potter Ben The Australian Financial Review Thursday 10 January 2013 wwwafrcom 11 ldquoThe real oil on US shale may be elusiverdquo press article written by Christopher Joyce Smart Money rdquoThe Australian Financial Reviewrdquo 25-26 May 2013 wwwafrcom

P a g e | 3

Further retaliation by the West was immediate Mirror image naval bases with upgraded infrastructure were quickly positioned at Bahrain Diego Garcia Djibouti Seychelles and elsewhere US pre-positioning strategy for materiel soon became the norm Rapid response initiatives were put into place For the first time since the phased withdrawal of the UKrsquos military presence east of Suez3 British warships were deployed on permanent station in the Gulf of Oman

Many believed a Soviet encirclement of the Middle East oilfields was imminent The Soviet invasion of Afghanistan reinforced this sagacious perception Today military analysts perceive the long term objective of the Sino-Russian bloc is to encircle and capture the same vital oilfields

In 1979 the future air-sea-battle lines were drawn athwart oil supply routes

These routes were around the Cape of Good Hope in the Arabian Gulf the northern Indian Ocean and further afield in the southern Atlantic The largest-volume oil routes were westward to North America and Europe Significantly less oil (conservatively estimated at roughly 28 of that shipped to Europe and the US) was shipped eastward to ASEAN countries Australasia India Pakistan Japan and China Chinarsquos oil consumption was not high relatively as most of the oil shipped eastward was to support manufacturing activity in Japan The latter was at the time destined to become the worldrsquos second-largest net oil importer

Oil Tanker War (1984-88)

The oil battle was joined in September 1984

Oil supply military interdiction first occurred when Iraqi aircraft attacked the oil terminal and Iranian tankers at Kharg Island The hitherto unexpected lsquoGulf Tanker Warrsquo broke out catching the West by surprise and was to last for some four desperate years until July 1988 Sometimes it is called the ldquoforgottenrdquo war largely because it was overlooked by military historians as a subsidiary war hidden within the much larger Iraq-Iran conflict

Oil tankers were steaming at full speed through the Strait of Hormuz (ldquoSuicide Alleyrdquo) at the rate of one tanker every two minutes4 In the upper reaches of the Arabian Gulf the multi-nation tankers including Kuwaiti tankers protected by the American flag dodged Exocet missiles hostile gunboats Boghammar fast patrol boats and sea mines Several oil tankers were damaged including the supertanker al-Rekkah renamed as the Bridgeton which struck a mine whilst in a northbound convey

Air-to-ship missiles used in the Tanker War included eight categories of missiles namely the French Exocet (AM-39) the US Harpoon (AGM-84A) and Maverick (AGM-65BC) and the Soviet Kipper (AS-2) Kitchen (AS-4) Kelt (AS-5) Kingfish (AS-6) and Sea Killer Many tankers received direct and tangential hits It was a miracle only three oil tankers were abandoned and declared total losses Nonetheless on less damaged tankers crew members were killed or badly injured

3 British phased military withdrawal commenced in 1968 thus abandoning the Arabian Gulf and Indian Ocean4 Some 80 or 90 merchant ships were daily transiting the Strait of Hormuz

P a g e | 4

and numerous fires occurred in engine rooms Fortunately the fires were quickly brought under control

In total between 1984 and 1987 an estimated 259 oil tankersproduct carriers and 52 cargofreighter vessels were attacked Another 39 vessels including tugs were also attacked It is amazing that only a mere 2 to 4 of the total shipping traffic (estimate) in the Arabian Gulf was sunk (total loss) in spite of the constant rain down of missiles during the war

At the height of hostilities four US Navy carrier battle groups were rotated in the region These were the ldquoRangerrdquo (CV-61) and ldquoMidwayrdquo (CVB-41) in the Bay of Bengal and the ldquoEnterpriserdquo (CVN-65) and ldquoForrestalrdquo (CV-59) in the Arabian Sea

The media immediately drew world attention to the emergency and its projected consequences for the West

Chinese involvement in the Tanker War soon manifested itself Towards the end of the war China supplied around three hundred HY-2 ldquoSilkwormrdquo anti-ship missiles to Iran This missile has a 96 km range and carries a 450 kg explosive warhead It is a Chinese version of the Soviet ldquoStyxrdquo anti-ship missile Iran unashamedly used these missiles against Kuwaiti tankers and offshore oil platforms

Threat Analysis

The Gulf Tanker War is a dire warning as to what may happen on a wider scale later this century in other oil chokepoints around the world In 2011 total world oil production amounted to approximately 87 million barrels per day (MMbbld) and over one-half was moved by tankers on fixed maritime routes By volume of oil transit the Strait of Hormuz leading out of the Arabian Gulf and the Strait of Malacca linking the Indian and Pacific Oceans are two of the worldrsquos most strategic chokepoints Other chokepoints are the Bab el-Mandab (Red Sea) Suez Canal and SUMED Relief Pipeline Turkish Straits Danish Straits and Panama Canal

Global oil supply is obviously vulnerable Impediments military or otherwise to oil tankers transiting the seven world chokepoints will serve to reduce oil flow through the umbilical cord World oil chokepoints for maritime transit of oil are a critical part of global energy security (US Energy Information Administration)

Iran has often threatened to block the Strait of Hormuz During the Tanker War Iran laid magnetic mines in the Arabian Gulf attacked Iraqi warships and oil installations

Worst Case Scenarios

At this juncture it is useful to describe a couple of worst case scenarios

ldquoA lsquoblockshiprsquo or lsquofireshiprsquo such as an innocuous looking dredge or barge flying a disarming flag of convenience devoid of the correct international code signals or flags displaying phony navigation lights at nighttime loaded with high explosives mines or destructive ordnance towed by a powerful tug suddenly and unexpectedly positioned in the direct path of an unsuspecting outgoing fully laden ULCC unable to change course quickly enough in the narrow channel to avoid a collision The

P a g e | 5

resultant conflagration and fireball is the worst possible outcome Such a heinous act is not beyond the present day capability of insurgents political dissidents or a rogue staterdquo

ldquoAnother potential scenario could be an old WWII submarine or present day Yono Class midget submarine clandestinely positioned without detection by depth finder or radar to lie innately and inconspicuously on the bottom of the shallowest part of the channel likewise loaded with high explosives set to ascend using remote control radio signals under the keel of a passing ULCC Such interdiction is not beyond the capability of those determined to disrupt oil supply to the Westrdquo

There are many other options ndash surface or sub-surface UASs modern midget or normal electric submarines aircraft or airborne RPV suicide collision and others Iran may possess secret weapons unknown to the West

Mankind has often demonstrated gross wanton destruction using the slightest of political whims as an unforgivable weak excuse History tells us so We may well pray that these scenarios might never eventuate

From the Iranian point of view the operational success or otherwise of these postulated worst case scenarios will greatly depend upon the viability of Western detection methods For instance those vested in Omani offshore patrol vessels (OPV) and helicopter surveillance together with regular channel sweeps conducted by US naval assets attached to the US Fifth Fleet on patrol from NSA Bahrain Detection methods which could also concern the Iranian Navy include new electronic detection methodologies undertaken by using RSAFUSAF airborne AWACS 5

The eyes of the world are now and forever cast upon the Strait of Hormuz Approximately forty per cent of the worldrsquos oil supply transits the Strait Every intelligence officer is sadly remiss if unable to understand the implications for the West The logistics of global oil supply are at stake Never before in the history of mankind has there been such an urgent (energy) issue

However it may be virtually impossible for terrorists pirates political groups or rogue nations to interdict oil supply in the Strait without early detection by the West

Missile Threat

Notwithstanding this assertion it can be said no amount of maritime surveillance can protect oil tankers from the ultimate missile threat especially if the warheads are nuclear In view of the lessons learnt from the Oil Tanker War the question is whether Iran (or North Korea) is irresponsible enough to use these deadly weapons to greater destructive effect with no regard for maintaining world peace The Islamic Republic of Iran Navy (IRIN) and the Islamic Revolutionary Guard Corps Navy (IRGCN) now have an estimated thirteen classes of missile6 China Russia and

5The Royal Saudi Air Force (RSAF) using 5X Boeing 707 modified E-3 Sentry aircraft and the United States Air Force (USAF) both undertake AWACS surveillance of maritime sources in the Arabian Gulf Strait of Hormuz and Gulf of Oman These assets are based at Prince Sultan Air Base (Al Kharj) and Al Udeid Air Base (Doha) respectively6 Iranrsquos missiles include Nasr 1 and 2 Victory battlefield range ballistic missile (BRBM) virtually identical to the C704 Chinese supplied cruise missile Rarsquod Thunder SS N 22 Sunburn P270 Moskit Ghadir Fateh-110 Mehrab (Altar) Meshkat (Lantern) NoorYinji (Hawk) C-8012 ASBM Seersucker CSS-C-2 Qader (Mighty) Zafar and

P a g e | 6

North Korea have combined to supply Iranrsquos missiles7 Iran continues to insist its defence doctrine is based upon deterrence

Potentially North Korea is able to interdict oil deliveries to Taiwan Japan and South Korea using offensive missile strikes

A number of latent thoughts arise at this juncture

Russia has abundant oil Iran currently needs to sell oil to defeat international embargoes China needs to buy large quantities of Middle East oil including from Iran If and when China obtains sufficient quantities of additional oil from Russia (Siberian crude) from the Caspian Region from Africa Venezuela or elsewhere then China will be correspondingly less dependent upon oil sourced from the Arabian Gulf littoral In the longer term ceteris paribus China with support from Russia could conceivably encourage Iran to block the Strait of Hormuz

This argument is probably fallacious

If China obtained sufficient oil coming from elsewhere and it does not need oil from the Arabian Gulf then why would Iran cede to China to block the Strait of Hormuz Obviously Iran still needs to export oil to generate income or to meet its internal domestic public sector expenditures If the Strait is blocked Iran will be unable to export much of its oil production Pipelinesroad tankers alone will not suffice

The US is reducing its dependence upon Middle East oil (recently estimated at close to 30 per cent once new pipelines and infrastructure come on stream)

Oil Volumes Transited Today

Tonnages of oil shipped through the Strait have increased exponentially in recent years pari passu with the growth in VLCC and ULCC gigantic size tankers Although mammoths such as ldquoOriental Nicetyrdquo (ldquoExxon Valdezrdquo) ldquoSeawise Giantrdquo ldquoPierre Guillaumatrdquo ldquoBatillusrdquo Bellamyardquo and ldquoPrairialrdquo are now scrapped (many are scrapped at the Alang breakers yard in India) they have been replaced by even larger tankers For example Iran has procured the worldrsquos largest tanker (with 22 million barrels capacity) to add to its 49 tanker national fleet8 ldquoSirius Starrdquo ldquoHua Sanrdquo and ldquoYangtze Starrdquo although very large are not quite in the same class

China is building the largest oil tanker fleet in the world (Poten and Partners Houston TX) and the worldrsquos largest merchant marine navy

Increased oil tonnages have greatly hastened the lsquopulse throb and flowrsquo of crude oil passing through the umbilical cord global oil supply

Changes in Volume Oil Supply

Nour (Light) Some of these are nuclear capable Some were successfully tested during the Velayat 91 naval manoeuvres held December 2012 The Nour missile can be launched from an estimated fleet of 10000 plus speedboats constituting a hard to defend ldquoswarm attackrdquo on Western transit shipping China has opened a missile production plant facility in Iran for the mass production of the Nasr 1 missile Iran is building a secret missile installation in Venezuela7 Lincy Valerie ldquoMore Talks with Iran set for Januaryrdquo Iran Watch Status Report Wisconsin Project on Nuclear Arms Control 1701 K Street NW Suite 805 Washington DC December 2012 8 Recently built in China (Internet source)

P a g e | 7

Today the prevailing exigencies associated with the need for consistent global oil supply have greatly increased the volume of oil transported worldwide for immediate consumption and for government strategic reserves China has overtaken Japan and is now the worldrsquos second largest net oil importer The US still the number one net importer has retreated somewhat and desires to become self-sufficient in hydrocarbons supply (using new technology to extract ldquokerogenrdquo not actually oil but an organic matter from indigenous shale oilfields)

The US long recognising its own vulnerability to sustained oil supply from the Middle East is now determined to reduce its dependence upon imported oil Increased prospecting and oil exploration activities are on the US mainland9 The US is also looking to Canada for sources of new oil supply (known as lsquoTight Oilrsquo) such as from new shale oil fields using improved extraction technology These new oil fields include the New Brunswick Albert and Devonian Kettle Point Formations and the lesser known Ordovician Collingwood Shale The shale oil boom has given the US the means to slash its oil import dependency using the new Keystone XL pipeline delivering substantial crude from carbon-heavy Canadian tar sands

US crude oil production is set to rise to its highest level in 25 years by 201410

A note of caution prevails here David Hughes an independent geologist has written an exhaustive 178-page research paper published by the Post Carbon Institute in February 2013 The paper examines 65000 existing US shale and gas wells The main finding is thus ldquo the challenges and costs of 21st Century fossil fuel production suggest that vastly increased supplies will not be easily achieved or even possiblerdquo11 Similarly research by the US Geological Survey casts doubt upon wildly optimistic production assumptions relied on by listed US companies when raising equity and debt capital

Gervaise Heddle a little-known Australian investor has circulated a private report claiming that US shale companiesrsquo profits bear little relation to actual cash earnings Heddle states ldquoEvery model of US growth has been tweaked to recognise the accepted lsquofactrsquo that shale oil will rescue North America from its indebtedness If the new shale oil and gas drilling techniques are genuinely a revolution that will unlock boundless energy itrsquos fair to assume that the companies capitalising on them can generate attractive cash returns But the evidence suggests otherwiserdquo

9 Innovative drilling technology has greatly improved US prospects for indigenous oil production ldquoThe Octopusrdquo multi-well pad drilling system is up to eight times faster than conventional methods The US may eclipse Saudi oil production by 2015 or earlier US crude imports have already fallen by 11 per cent US based exploration companies include Continental Resources Brigham Exploration Devon Energy EnCana and North Dakota Mineral Resources Some of these companies are operating on the Bakken shale oilfield Cost per well using multi-pad technology is reduced to U$25M from the conventional cost of US$6M Source ldquoOil and Gas Traderrdquo downloaded Monday 3 June 2013 (1030 hrs AEST Australia)NOTES (a) The US anticipates total world oil production dominance by (say) 2025 or earlier (b) Also refer to the report entitled ldquo550 Windfall from Bakken Octopus Technologyrdquo produced by the ldquoOil and Gas Traderrdquo in 2013 (c) It is perceived by some that Saudi Arabia will cease exporting oil by 2030 Further research is needed10 Potter Ben The Australian Financial Review Thursday 10 January 2013 wwwafrcom 11 ldquoThe real oil on US shale may be elusiverdquo press article written by Christopher Joyce Smart Money rdquoThe Australian Financial Reviewrdquo 25-26 May 2013 wwwafrcom

P a g e | 4

and numerous fires occurred in engine rooms Fortunately the fires were quickly brought under control

In total between 1984 and 1987 an estimated 259 oil tankersproduct carriers and 52 cargofreighter vessels were attacked Another 39 vessels including tugs were also attacked It is amazing that only a mere 2 to 4 of the total shipping traffic (estimate) in the Arabian Gulf was sunk (total loss) in spite of the constant rain down of missiles during the war

At the height of hostilities four US Navy carrier battle groups were rotated in the region These were the ldquoRangerrdquo (CV-61) and ldquoMidwayrdquo (CVB-41) in the Bay of Bengal and the ldquoEnterpriserdquo (CVN-65) and ldquoForrestalrdquo (CV-59) in the Arabian Sea

The media immediately drew world attention to the emergency and its projected consequences for the West

Chinese involvement in the Tanker War soon manifested itself Towards the end of the war China supplied around three hundred HY-2 ldquoSilkwormrdquo anti-ship missiles to Iran This missile has a 96 km range and carries a 450 kg explosive warhead It is a Chinese version of the Soviet ldquoStyxrdquo anti-ship missile Iran unashamedly used these missiles against Kuwaiti tankers and offshore oil platforms

Threat Analysis

The Gulf Tanker War is a dire warning as to what may happen on a wider scale later this century in other oil chokepoints around the world In 2011 total world oil production amounted to approximately 87 million barrels per day (MMbbld) and over one-half was moved by tankers on fixed maritime routes By volume of oil transit the Strait of Hormuz leading out of the Arabian Gulf and the Strait of Malacca linking the Indian and Pacific Oceans are two of the worldrsquos most strategic chokepoints Other chokepoints are the Bab el-Mandab (Red Sea) Suez Canal and SUMED Relief Pipeline Turkish Straits Danish Straits and Panama Canal

Global oil supply is obviously vulnerable Impediments military or otherwise to oil tankers transiting the seven world chokepoints will serve to reduce oil flow through the umbilical cord World oil chokepoints for maritime transit of oil are a critical part of global energy security (US Energy Information Administration)

Iran has often threatened to block the Strait of Hormuz During the Tanker War Iran laid magnetic mines in the Arabian Gulf attacked Iraqi warships and oil installations

Worst Case Scenarios

At this juncture it is useful to describe a couple of worst case scenarios

ldquoA lsquoblockshiprsquo or lsquofireshiprsquo such as an innocuous looking dredge or barge flying a disarming flag of convenience devoid of the correct international code signals or flags displaying phony navigation lights at nighttime loaded with high explosives mines or destructive ordnance towed by a powerful tug suddenly and unexpectedly positioned in the direct path of an unsuspecting outgoing fully laden ULCC unable to change course quickly enough in the narrow channel to avoid a collision The

P a g e | 5

resultant conflagration and fireball is the worst possible outcome Such a heinous act is not beyond the present day capability of insurgents political dissidents or a rogue staterdquo

ldquoAnother potential scenario could be an old WWII submarine or present day Yono Class midget submarine clandestinely positioned without detection by depth finder or radar to lie innately and inconspicuously on the bottom of the shallowest part of the channel likewise loaded with high explosives set to ascend using remote control radio signals under the keel of a passing ULCC Such interdiction is not beyond the capability of those determined to disrupt oil supply to the Westrdquo

There are many other options ndash surface or sub-surface UASs modern midget or normal electric submarines aircraft or airborne RPV suicide collision and others Iran may possess secret weapons unknown to the West

Mankind has often demonstrated gross wanton destruction using the slightest of political whims as an unforgivable weak excuse History tells us so We may well pray that these scenarios might never eventuate

From the Iranian point of view the operational success or otherwise of these postulated worst case scenarios will greatly depend upon the viability of Western detection methods For instance those vested in Omani offshore patrol vessels (OPV) and helicopter surveillance together with regular channel sweeps conducted by US naval assets attached to the US Fifth Fleet on patrol from NSA Bahrain Detection methods which could also concern the Iranian Navy include new electronic detection methodologies undertaken by using RSAFUSAF airborne AWACS 5

The eyes of the world are now and forever cast upon the Strait of Hormuz Approximately forty per cent of the worldrsquos oil supply transits the Strait Every intelligence officer is sadly remiss if unable to understand the implications for the West The logistics of global oil supply are at stake Never before in the history of mankind has there been such an urgent (energy) issue

However it may be virtually impossible for terrorists pirates political groups or rogue nations to interdict oil supply in the Strait without early detection by the West

Missile Threat

Notwithstanding this assertion it can be said no amount of maritime surveillance can protect oil tankers from the ultimate missile threat especially if the warheads are nuclear In view of the lessons learnt from the Oil Tanker War the question is whether Iran (or North Korea) is irresponsible enough to use these deadly weapons to greater destructive effect with no regard for maintaining world peace The Islamic Republic of Iran Navy (IRIN) and the Islamic Revolutionary Guard Corps Navy (IRGCN) now have an estimated thirteen classes of missile6 China Russia and

5The Royal Saudi Air Force (RSAF) using 5X Boeing 707 modified E-3 Sentry aircraft and the United States Air Force (USAF) both undertake AWACS surveillance of maritime sources in the Arabian Gulf Strait of Hormuz and Gulf of Oman These assets are based at Prince Sultan Air Base (Al Kharj) and Al Udeid Air Base (Doha) respectively6 Iranrsquos missiles include Nasr 1 and 2 Victory battlefield range ballistic missile (BRBM) virtually identical to the C704 Chinese supplied cruise missile Rarsquod Thunder SS N 22 Sunburn P270 Moskit Ghadir Fateh-110 Mehrab (Altar) Meshkat (Lantern) NoorYinji (Hawk) C-8012 ASBM Seersucker CSS-C-2 Qader (Mighty) Zafar and

P a g e | 6

North Korea have combined to supply Iranrsquos missiles7 Iran continues to insist its defence doctrine is based upon deterrence

Potentially North Korea is able to interdict oil deliveries to Taiwan Japan and South Korea using offensive missile strikes

A number of latent thoughts arise at this juncture

Russia has abundant oil Iran currently needs to sell oil to defeat international embargoes China needs to buy large quantities of Middle East oil including from Iran If and when China obtains sufficient quantities of additional oil from Russia (Siberian crude) from the Caspian Region from Africa Venezuela or elsewhere then China will be correspondingly less dependent upon oil sourced from the Arabian Gulf littoral In the longer term ceteris paribus China with support from Russia could conceivably encourage Iran to block the Strait of Hormuz

This argument is probably fallacious

If China obtained sufficient oil coming from elsewhere and it does not need oil from the Arabian Gulf then why would Iran cede to China to block the Strait of Hormuz Obviously Iran still needs to export oil to generate income or to meet its internal domestic public sector expenditures If the Strait is blocked Iran will be unable to export much of its oil production Pipelinesroad tankers alone will not suffice

The US is reducing its dependence upon Middle East oil (recently estimated at close to 30 per cent once new pipelines and infrastructure come on stream)

Oil Volumes Transited Today

Tonnages of oil shipped through the Strait have increased exponentially in recent years pari passu with the growth in VLCC and ULCC gigantic size tankers Although mammoths such as ldquoOriental Nicetyrdquo (ldquoExxon Valdezrdquo) ldquoSeawise Giantrdquo ldquoPierre Guillaumatrdquo ldquoBatillusrdquo Bellamyardquo and ldquoPrairialrdquo are now scrapped (many are scrapped at the Alang breakers yard in India) they have been replaced by even larger tankers For example Iran has procured the worldrsquos largest tanker (with 22 million barrels capacity) to add to its 49 tanker national fleet8 ldquoSirius Starrdquo ldquoHua Sanrdquo and ldquoYangtze Starrdquo although very large are not quite in the same class

China is building the largest oil tanker fleet in the world (Poten and Partners Houston TX) and the worldrsquos largest merchant marine navy

Increased oil tonnages have greatly hastened the lsquopulse throb and flowrsquo of crude oil passing through the umbilical cord global oil supply

Changes in Volume Oil Supply

Nour (Light) Some of these are nuclear capable Some were successfully tested during the Velayat 91 naval manoeuvres held December 2012 The Nour missile can be launched from an estimated fleet of 10000 plus speedboats constituting a hard to defend ldquoswarm attackrdquo on Western transit shipping China has opened a missile production plant facility in Iran for the mass production of the Nasr 1 missile Iran is building a secret missile installation in Venezuela7 Lincy Valerie ldquoMore Talks with Iran set for Januaryrdquo Iran Watch Status Report Wisconsin Project on Nuclear Arms Control 1701 K Street NW Suite 805 Washington DC December 2012 8 Recently built in China (Internet source)

P a g e | 7

Today the prevailing exigencies associated with the need for consistent global oil supply have greatly increased the volume of oil transported worldwide for immediate consumption and for government strategic reserves China has overtaken Japan and is now the worldrsquos second largest net oil importer The US still the number one net importer has retreated somewhat and desires to become self-sufficient in hydrocarbons supply (using new technology to extract ldquokerogenrdquo not actually oil but an organic matter from indigenous shale oilfields)

The US long recognising its own vulnerability to sustained oil supply from the Middle East is now determined to reduce its dependence upon imported oil Increased prospecting and oil exploration activities are on the US mainland9 The US is also looking to Canada for sources of new oil supply (known as lsquoTight Oilrsquo) such as from new shale oil fields using improved extraction technology These new oil fields include the New Brunswick Albert and Devonian Kettle Point Formations and the lesser known Ordovician Collingwood Shale The shale oil boom has given the US the means to slash its oil import dependency using the new Keystone XL pipeline delivering substantial crude from carbon-heavy Canadian tar sands

US crude oil production is set to rise to its highest level in 25 years by 201410

A note of caution prevails here David Hughes an independent geologist has written an exhaustive 178-page research paper published by the Post Carbon Institute in February 2013 The paper examines 65000 existing US shale and gas wells The main finding is thus ldquo the challenges and costs of 21st Century fossil fuel production suggest that vastly increased supplies will not be easily achieved or even possiblerdquo11 Similarly research by the US Geological Survey casts doubt upon wildly optimistic production assumptions relied on by listed US companies when raising equity and debt capital

Gervaise Heddle a little-known Australian investor has circulated a private report claiming that US shale companiesrsquo profits bear little relation to actual cash earnings Heddle states ldquoEvery model of US growth has been tweaked to recognise the accepted lsquofactrsquo that shale oil will rescue North America from its indebtedness If the new shale oil and gas drilling techniques are genuinely a revolution that will unlock boundless energy itrsquos fair to assume that the companies capitalising on them can generate attractive cash returns But the evidence suggests otherwiserdquo

9 Innovative drilling technology has greatly improved US prospects for indigenous oil production ldquoThe Octopusrdquo multi-well pad drilling system is up to eight times faster than conventional methods The US may eclipse Saudi oil production by 2015 or earlier US crude imports have already fallen by 11 per cent US based exploration companies include Continental Resources Brigham Exploration Devon Energy EnCana and North Dakota Mineral Resources Some of these companies are operating on the Bakken shale oilfield Cost per well using multi-pad technology is reduced to U$25M from the conventional cost of US$6M Source ldquoOil and Gas Traderrdquo downloaded Monday 3 June 2013 (1030 hrs AEST Australia)NOTES (a) The US anticipates total world oil production dominance by (say) 2025 or earlier (b) Also refer to the report entitled ldquo550 Windfall from Bakken Octopus Technologyrdquo produced by the ldquoOil and Gas Traderrdquo in 2013 (c) It is perceived by some that Saudi Arabia will cease exporting oil by 2030 Further research is needed10 Potter Ben The Australian Financial Review Thursday 10 January 2013 wwwafrcom 11 ldquoThe real oil on US shale may be elusiverdquo press article written by Christopher Joyce Smart Money rdquoThe Australian Financial Reviewrdquo 25-26 May 2013 wwwafrcom

P a g e | 5

resultant conflagration and fireball is the worst possible outcome Such a heinous act is not beyond the present day capability of insurgents political dissidents or a rogue staterdquo

ldquoAnother potential scenario could be an old WWII submarine or present day Yono Class midget submarine clandestinely positioned without detection by depth finder or radar to lie innately and inconspicuously on the bottom of the shallowest part of the channel likewise loaded with high explosives set to ascend using remote control radio signals under the keel of a passing ULCC Such interdiction is not beyond the capability of those determined to disrupt oil supply to the Westrdquo

There are many other options ndash surface or sub-surface UASs modern midget or normal electric submarines aircraft or airborne RPV suicide collision and others Iran may possess secret weapons unknown to the West

Mankind has often demonstrated gross wanton destruction using the slightest of political whims as an unforgivable weak excuse History tells us so We may well pray that these scenarios might never eventuate

From the Iranian point of view the operational success or otherwise of these postulated worst case scenarios will greatly depend upon the viability of Western detection methods For instance those vested in Omani offshore patrol vessels (OPV) and helicopter surveillance together with regular channel sweeps conducted by US naval assets attached to the US Fifth Fleet on patrol from NSA Bahrain Detection methods which could also concern the Iranian Navy include new electronic detection methodologies undertaken by using RSAFUSAF airborne AWACS 5

The eyes of the world are now and forever cast upon the Strait of Hormuz Approximately forty per cent of the worldrsquos oil supply transits the Strait Every intelligence officer is sadly remiss if unable to understand the implications for the West The logistics of global oil supply are at stake Never before in the history of mankind has there been such an urgent (energy) issue

However it may be virtually impossible for terrorists pirates political groups or rogue nations to interdict oil supply in the Strait without early detection by the West

Missile Threat

Notwithstanding this assertion it can be said no amount of maritime surveillance can protect oil tankers from the ultimate missile threat especially if the warheads are nuclear In view of the lessons learnt from the Oil Tanker War the question is whether Iran (or North Korea) is irresponsible enough to use these deadly weapons to greater destructive effect with no regard for maintaining world peace The Islamic Republic of Iran Navy (IRIN) and the Islamic Revolutionary Guard Corps Navy (IRGCN) now have an estimated thirteen classes of missile6 China Russia and

5The Royal Saudi Air Force (RSAF) using 5X Boeing 707 modified E-3 Sentry aircraft and the United States Air Force (USAF) both undertake AWACS surveillance of maritime sources in the Arabian Gulf Strait of Hormuz and Gulf of Oman These assets are based at Prince Sultan Air Base (Al Kharj) and Al Udeid Air Base (Doha) respectively6 Iranrsquos missiles include Nasr 1 and 2 Victory battlefield range ballistic missile (BRBM) virtually identical to the C704 Chinese supplied cruise missile Rarsquod Thunder SS N 22 Sunburn P270 Moskit Ghadir Fateh-110 Mehrab (Altar) Meshkat (Lantern) NoorYinji (Hawk) C-8012 ASBM Seersucker CSS-C-2 Qader (Mighty) Zafar and

P a g e | 6

North Korea have combined to supply Iranrsquos missiles7 Iran continues to insist its defence doctrine is based upon deterrence

Potentially North Korea is able to interdict oil deliveries to Taiwan Japan and South Korea using offensive missile strikes

A number of latent thoughts arise at this juncture

Russia has abundant oil Iran currently needs to sell oil to defeat international embargoes China needs to buy large quantities of Middle East oil including from Iran If and when China obtains sufficient quantities of additional oil from Russia (Siberian crude) from the Caspian Region from Africa Venezuela or elsewhere then China will be correspondingly less dependent upon oil sourced from the Arabian Gulf littoral In the longer term ceteris paribus China with support from Russia could conceivably encourage Iran to block the Strait of Hormuz

This argument is probably fallacious

If China obtained sufficient oil coming from elsewhere and it does not need oil from the Arabian Gulf then why would Iran cede to China to block the Strait of Hormuz Obviously Iran still needs to export oil to generate income or to meet its internal domestic public sector expenditures If the Strait is blocked Iran will be unable to export much of its oil production Pipelinesroad tankers alone will not suffice

The US is reducing its dependence upon Middle East oil (recently estimated at close to 30 per cent once new pipelines and infrastructure come on stream)

Oil Volumes Transited Today

Tonnages of oil shipped through the Strait have increased exponentially in recent years pari passu with the growth in VLCC and ULCC gigantic size tankers Although mammoths such as ldquoOriental Nicetyrdquo (ldquoExxon Valdezrdquo) ldquoSeawise Giantrdquo ldquoPierre Guillaumatrdquo ldquoBatillusrdquo Bellamyardquo and ldquoPrairialrdquo are now scrapped (many are scrapped at the Alang breakers yard in India) they have been replaced by even larger tankers For example Iran has procured the worldrsquos largest tanker (with 22 million barrels capacity) to add to its 49 tanker national fleet8 ldquoSirius Starrdquo ldquoHua Sanrdquo and ldquoYangtze Starrdquo although very large are not quite in the same class

China is building the largest oil tanker fleet in the world (Poten and Partners Houston TX) and the worldrsquos largest merchant marine navy

Increased oil tonnages have greatly hastened the lsquopulse throb and flowrsquo of crude oil passing through the umbilical cord global oil supply

Changes in Volume Oil Supply

Nour (Light) Some of these are nuclear capable Some were successfully tested during the Velayat 91 naval manoeuvres held December 2012 The Nour missile can be launched from an estimated fleet of 10000 plus speedboats constituting a hard to defend ldquoswarm attackrdquo on Western transit shipping China has opened a missile production plant facility in Iran for the mass production of the Nasr 1 missile Iran is building a secret missile installation in Venezuela7 Lincy Valerie ldquoMore Talks with Iran set for Januaryrdquo Iran Watch Status Report Wisconsin Project on Nuclear Arms Control 1701 K Street NW Suite 805 Washington DC December 2012 8 Recently built in China (Internet source)

P a g e | 7

Today the prevailing exigencies associated with the need for consistent global oil supply have greatly increased the volume of oil transported worldwide for immediate consumption and for government strategic reserves China has overtaken Japan and is now the worldrsquos second largest net oil importer The US still the number one net importer has retreated somewhat and desires to become self-sufficient in hydrocarbons supply (using new technology to extract ldquokerogenrdquo not actually oil but an organic matter from indigenous shale oilfields)

The US long recognising its own vulnerability to sustained oil supply from the Middle East is now determined to reduce its dependence upon imported oil Increased prospecting and oil exploration activities are on the US mainland9 The US is also looking to Canada for sources of new oil supply (known as lsquoTight Oilrsquo) such as from new shale oil fields using improved extraction technology These new oil fields include the New Brunswick Albert and Devonian Kettle Point Formations and the lesser known Ordovician Collingwood Shale The shale oil boom has given the US the means to slash its oil import dependency using the new Keystone XL pipeline delivering substantial crude from carbon-heavy Canadian tar sands

US crude oil production is set to rise to its highest level in 25 years by 201410

A note of caution prevails here David Hughes an independent geologist has written an exhaustive 178-page research paper published by the Post Carbon Institute in February 2013 The paper examines 65000 existing US shale and gas wells The main finding is thus ldquo the challenges and costs of 21st Century fossil fuel production suggest that vastly increased supplies will not be easily achieved or even possiblerdquo11 Similarly research by the US Geological Survey casts doubt upon wildly optimistic production assumptions relied on by listed US companies when raising equity and debt capital

Gervaise Heddle a little-known Australian investor has circulated a private report claiming that US shale companiesrsquo profits bear little relation to actual cash earnings Heddle states ldquoEvery model of US growth has been tweaked to recognise the accepted lsquofactrsquo that shale oil will rescue North America from its indebtedness If the new shale oil and gas drilling techniques are genuinely a revolution that will unlock boundless energy itrsquos fair to assume that the companies capitalising on them can generate attractive cash returns But the evidence suggests otherwiserdquo

9 Innovative drilling technology has greatly improved US prospects for indigenous oil production ldquoThe Octopusrdquo multi-well pad drilling system is up to eight times faster than conventional methods The US may eclipse Saudi oil production by 2015 or earlier US crude imports have already fallen by 11 per cent US based exploration companies include Continental Resources Brigham Exploration Devon Energy EnCana and North Dakota Mineral Resources Some of these companies are operating on the Bakken shale oilfield Cost per well using multi-pad technology is reduced to U$25M from the conventional cost of US$6M Source ldquoOil and Gas Traderrdquo downloaded Monday 3 June 2013 (1030 hrs AEST Australia)NOTES (a) The US anticipates total world oil production dominance by (say) 2025 or earlier (b) Also refer to the report entitled ldquo550 Windfall from Bakken Octopus Technologyrdquo produced by the ldquoOil and Gas Traderrdquo in 2013 (c) It is perceived by some that Saudi Arabia will cease exporting oil by 2030 Further research is needed10 Potter Ben The Australian Financial Review Thursday 10 January 2013 wwwafrcom 11 ldquoThe real oil on US shale may be elusiverdquo press article written by Christopher Joyce Smart Money rdquoThe Australian Financial Reviewrdquo 25-26 May 2013 wwwafrcom

P a g e | 6

North Korea have combined to supply Iranrsquos missiles7 Iran continues to insist its defence doctrine is based upon deterrence

Potentially North Korea is able to interdict oil deliveries to Taiwan Japan and South Korea using offensive missile strikes

A number of latent thoughts arise at this juncture

Russia has abundant oil Iran currently needs to sell oil to defeat international embargoes China needs to buy large quantities of Middle East oil including from Iran If and when China obtains sufficient quantities of additional oil from Russia (Siberian crude) from the Caspian Region from Africa Venezuela or elsewhere then China will be correspondingly less dependent upon oil sourced from the Arabian Gulf littoral In the longer term ceteris paribus China with support from Russia could conceivably encourage Iran to block the Strait of Hormuz

This argument is probably fallacious

If China obtained sufficient oil coming from elsewhere and it does not need oil from the Arabian Gulf then why would Iran cede to China to block the Strait of Hormuz Obviously Iran still needs to export oil to generate income or to meet its internal domestic public sector expenditures If the Strait is blocked Iran will be unable to export much of its oil production Pipelinesroad tankers alone will not suffice

The US is reducing its dependence upon Middle East oil (recently estimated at close to 30 per cent once new pipelines and infrastructure come on stream)

Oil Volumes Transited Today

Tonnages of oil shipped through the Strait have increased exponentially in recent years pari passu with the growth in VLCC and ULCC gigantic size tankers Although mammoths such as ldquoOriental Nicetyrdquo (ldquoExxon Valdezrdquo) ldquoSeawise Giantrdquo ldquoPierre Guillaumatrdquo ldquoBatillusrdquo Bellamyardquo and ldquoPrairialrdquo are now scrapped (many are scrapped at the Alang breakers yard in India) they have been replaced by even larger tankers For example Iran has procured the worldrsquos largest tanker (with 22 million barrels capacity) to add to its 49 tanker national fleet8 ldquoSirius Starrdquo ldquoHua Sanrdquo and ldquoYangtze Starrdquo although very large are not quite in the same class

China is building the largest oil tanker fleet in the world (Poten and Partners Houston TX) and the worldrsquos largest merchant marine navy

Increased oil tonnages have greatly hastened the lsquopulse throb and flowrsquo of crude oil passing through the umbilical cord global oil supply

Changes in Volume Oil Supply

Nour (Light) Some of these are nuclear capable Some were successfully tested during the Velayat 91 naval manoeuvres held December 2012 The Nour missile can be launched from an estimated fleet of 10000 plus speedboats constituting a hard to defend ldquoswarm attackrdquo on Western transit shipping China has opened a missile production plant facility in Iran for the mass production of the Nasr 1 missile Iran is building a secret missile installation in Venezuela7 Lincy Valerie ldquoMore Talks with Iran set for Januaryrdquo Iran Watch Status Report Wisconsin Project on Nuclear Arms Control 1701 K Street NW Suite 805 Washington DC December 2012 8 Recently built in China (Internet source)

P a g e | 7

Today the prevailing exigencies associated with the need for consistent global oil supply have greatly increased the volume of oil transported worldwide for immediate consumption and for government strategic reserves China has overtaken Japan and is now the worldrsquos second largest net oil importer The US still the number one net importer has retreated somewhat and desires to become self-sufficient in hydrocarbons supply (using new technology to extract ldquokerogenrdquo not actually oil but an organic matter from indigenous shale oilfields)

The US long recognising its own vulnerability to sustained oil supply from the Middle East is now determined to reduce its dependence upon imported oil Increased prospecting and oil exploration activities are on the US mainland9 The US is also looking to Canada for sources of new oil supply (known as lsquoTight Oilrsquo) such as from new shale oil fields using improved extraction technology These new oil fields include the New Brunswick Albert and Devonian Kettle Point Formations and the lesser known Ordovician Collingwood Shale The shale oil boom has given the US the means to slash its oil import dependency using the new Keystone XL pipeline delivering substantial crude from carbon-heavy Canadian tar sands

US crude oil production is set to rise to its highest level in 25 years by 201410

A note of caution prevails here David Hughes an independent geologist has written an exhaustive 178-page research paper published by the Post Carbon Institute in February 2013 The paper examines 65000 existing US shale and gas wells The main finding is thus ldquo the challenges and costs of 21st Century fossil fuel production suggest that vastly increased supplies will not be easily achieved or even possiblerdquo11 Similarly research by the US Geological Survey casts doubt upon wildly optimistic production assumptions relied on by listed US companies when raising equity and debt capital

Gervaise Heddle a little-known Australian investor has circulated a private report claiming that US shale companiesrsquo profits bear little relation to actual cash earnings Heddle states ldquoEvery model of US growth has been tweaked to recognise the accepted lsquofactrsquo that shale oil will rescue North America from its indebtedness If the new shale oil and gas drilling techniques are genuinely a revolution that will unlock boundless energy itrsquos fair to assume that the companies capitalising on them can generate attractive cash returns But the evidence suggests otherwiserdquo

9 Innovative drilling technology has greatly improved US prospects for indigenous oil production ldquoThe Octopusrdquo multi-well pad drilling system is up to eight times faster than conventional methods The US may eclipse Saudi oil production by 2015 or earlier US crude imports have already fallen by 11 per cent US based exploration companies include Continental Resources Brigham Exploration Devon Energy EnCana and North Dakota Mineral Resources Some of these companies are operating on the Bakken shale oilfield Cost per well using multi-pad technology is reduced to U$25M from the conventional cost of US$6M Source ldquoOil and Gas Traderrdquo downloaded Monday 3 June 2013 (1030 hrs AEST Australia)NOTES (a) The US anticipates total world oil production dominance by (say) 2025 or earlier (b) Also refer to the report entitled ldquo550 Windfall from Bakken Octopus Technologyrdquo produced by the ldquoOil and Gas Traderrdquo in 2013 (c) It is perceived by some that Saudi Arabia will cease exporting oil by 2030 Further research is needed10 Potter Ben The Australian Financial Review Thursday 10 January 2013 wwwafrcom 11 ldquoThe real oil on US shale may be elusiverdquo press article written by Christopher Joyce Smart Money rdquoThe Australian Financial Reviewrdquo 25-26 May 2013 wwwafrcom

P a g e | 7

Today the prevailing exigencies associated with the need for consistent global oil supply have greatly increased the volume of oil transported worldwide for immediate consumption and for government strategic reserves China has overtaken Japan and is now the worldrsquos second largest net oil importer The US still the number one net importer has retreated somewhat and desires to become self-sufficient in hydrocarbons supply (using new technology to extract ldquokerogenrdquo not actually oil but an organic matter from indigenous shale oilfields)

The US long recognising its own vulnerability to sustained oil supply from the Middle East is now determined to reduce its dependence upon imported oil Increased prospecting and oil exploration activities are on the US mainland9 The US is also looking to Canada for sources of new oil supply (known as lsquoTight Oilrsquo) such as from new shale oil fields using improved extraction technology These new oil fields include the New Brunswick Albert and Devonian Kettle Point Formations and the lesser known Ordovician Collingwood Shale The shale oil boom has given the US the means to slash its oil import dependency using the new Keystone XL pipeline delivering substantial crude from carbon-heavy Canadian tar sands

US crude oil production is set to rise to its highest level in 25 years by 201410

A note of caution prevails here David Hughes an independent geologist has written an exhaustive 178-page research paper published by the Post Carbon Institute in February 2013 The paper examines 65000 existing US shale and gas wells The main finding is thus ldquo the challenges and costs of 21st Century fossil fuel production suggest that vastly increased supplies will not be easily achieved or even possiblerdquo11 Similarly research by the US Geological Survey casts doubt upon wildly optimistic production assumptions relied on by listed US companies when raising equity and debt capital

Gervaise Heddle a little-known Australian investor has circulated a private report claiming that US shale companiesrsquo profits bear little relation to actual cash earnings Heddle states ldquoEvery model of US growth has been tweaked to recognise the accepted lsquofactrsquo that shale oil will rescue North America from its indebtedness If the new shale oil and gas drilling techniques are genuinely a revolution that will unlock boundless energy itrsquos fair to assume that the companies capitalising on them can generate attractive cash returns But the evidence suggests otherwiserdquo

9 Innovative drilling technology has greatly improved US prospects for indigenous oil production ldquoThe Octopusrdquo multi-well pad drilling system is up to eight times faster than conventional methods The US may eclipse Saudi oil production by 2015 or earlier US crude imports have already fallen by 11 per cent US based exploration companies include Continental Resources Brigham Exploration Devon Energy EnCana and North Dakota Mineral Resources Some of these companies are operating on the Bakken shale oilfield Cost per well using multi-pad technology is reduced to U$25M from the conventional cost of US$6M Source ldquoOil and Gas Traderrdquo downloaded Monday 3 June 2013 (1030 hrs AEST Australia)NOTES (a) The US anticipates total world oil production dominance by (say) 2025 or earlier (b) Also refer to the report entitled ldquo550 Windfall from Bakken Octopus Technologyrdquo produced by the ldquoOil and Gas Traderrdquo in 2013 (c) It is perceived by some that Saudi Arabia will cease exporting oil by 2030 Further research is needed10 Potter Ben The Australian Financial Review Thursday 10 January 2013 wwwafrcom 11 ldquoThe real oil on US shale may be elusiverdquo press article written by Christopher Joyce Smart Money rdquoThe Australian Financial Reviewrdquo 25-26 May 2013 wwwafrcom

P a g e | 8

Thus it could be that a predicted US lsquosecond oil boomrsquo may be nothing more than an ephemeral mirage The initial euphoria might easily dispel by 2017 when some oil industry experts believe Tight Oil (shale oil) will peak to eventually collapse back to 2012 levels by 2019

If these dire predictions are to run true the implications for the US economy are self-evident The US dollar could weaken and fall back to 2012 exchange rates The US economy may once again totter on the edge of the fiscal cliff The US will still be dependent on Middle East oil

The paradigm of global oil supply has significantly changed The oil still flows westward around the Cape of Good Hope but compared with 2003 patterns much more oil now flows eastwards to India Pakistan ASEAN countries Australasia China12 South Korea and Japan Additional quantitative research is useful here

The rampant Chinese Dragon has replaced the Soviet Bear in the quest for military control over the oil supply chain Less obviously today rather than openly displaying military prowess over oil transit routes the Bear lurks in the background supplying Siberian crude at below market price to the Dragon

Looking at the hitherto described oil routes it is now apparent that more oil flows eastward than flows westward Based upon a simple extrapolation from The World Factbook13 oil imports expressed in millions of barrels of oil per day14 (MMbblday) for India (306) ASEAN (460) Taiwan (088) China (508) Japan (439) and South Korea (250) when combined add to approximately 2048 MMbblday The US (103) and European Union (861) together total approximately 1891 MMbblday15 This represents a difference of some 16 MMbblday16 The real figure is probably close to 3 million barrels per day when Australasia Pakistan Bangladesh and Sri Lanka are included in the eastward flow

More accurate extrapolation should be undertaken for improved research into worldwide oil flows using more recent figures and estimates

This is a quantum change in the global pattern of oil supply to that depicted in the US Pacific Command (USPACCOM) strategic map released to Middlebury College Middlebury in Vermont in 2003 USLANTCOM USCENCOM and USPACCOM

12 There are approximately 400 oil terminals on mainland China13 List of Countries by oil imports compiled by Wikipedia and based upon The World Factbook refer to wwwciagovlibrarypublicationsthe-world-factbookrankorder2175rankhtml 14 An oil barrel (abbreviated as bbl) is a unit of volume whose definition has not been universally standardized In the United States and Canada an oil barrel is defined as 42 US gallons which is equivalent to 158987294928 litres (L) exactly or approximately 349723 imperial gallons Depending on the context it can also be defined as 35 imperial gallons or as 159 liters Oil companies that are listed on American stock exchanges typically report their production in terms of volume and use the units of bbl Mbbl (one thousand barrels) or MMbbl (one million barrels) Source Wikipedia accessed March 2013 15 Figures in parenthesis are expressed as millions of barrels per day (MMbblday)16 Not all countries are included in the extrapolated figures (mostly 2009 but also inclusive of some 2010 and 2011 figures) Some bias obtains Oil flows from all sources are included Pakistan Sri Lanka Bangladesh South Korea Australasia and the Pacific Islands are excluded Estimates are for illustrative purposes only

P a g e | 9

strategic maps (classified) continue to detail the major crude oil trade flows for military logistic analysis17

Increasing Militarism

Nonetheless given these changes the same geo-strategic principles (military posturing prepositioning materiel rapid response infrastructure development) that were highlighted by Professor Geoffrey Kemp in 1976 are equally present today

Again the potential adversaries have taken up new positions with renewed vigour Military bases are again crowding the oil supply umbilical cord The adversaries will face-off each other across many millions of sq kms of ocean In tandem with obvious threats of military interdiction to the umbilical cord there are illegal (UNCLOS and EEZ) competing claims for undersea oil and gas reserves in coastal seas close to ASEAN countries Japan South Korea and China

To state the obvious truth there is a clear dichotomy between East and West The predominant powers are irreversibly aligned into two main camps The Sino-Russian bloc supported by Iran and North Korea and the US-Europe bloc supported by India ASEAN Japan and Australasia This is a simplistic analysis It does not consider emerging loyalties from smaller nations and surrogate rogue states Yet to be fully committed third-world countries play the political odds both ways to precipitate a desirable outcome for themselves

Chen Yuming Chinese ambassador to Australia ldquohas branded Australiarsquos decision to strengthen military ties with the US as demonstrating a Cold War-style ldquoconfrontation or containmentrdquo mentality towards Beijingrdquo18

Japan South Korea and Taiwan have also been chastised by Chinese diplomats for purchasing US weapons and materiel Likewise have the Western sympathetic Arab oil producing states in the Arabian Gulf littoral

The Sino-Russian and US-Europe power entities are constantly aligning their respective political economic and military strengths in anticipation of a potential East-West conflict as to who ultimately secures absolute oil supply

It is as if the would-be adversaries are deliberately rushing selfishly to guard the precious oil flow for their own consumption Indeed this on closer examination proves to be the case

China and Iran

For example the Peoplersquos Liberation Army Navy (PLAN) intends to construct new naval bases and associated infrastructure at Gwadar (Pakistan) Hambantota (Sri Lanka) Marao (Maldives) Small and Great Coco Islands (Myanmar) Chittagong (Bangladesh) Sittwe Kyuakpu Mergui and Hainggyi Island These are constituent

17 A declassified strategic map was released by USPACCOM to Middlebury College in 2003 It can be downloaded from The South China Sea Virtual Library at wwwmiddleburyedu~scs 18 ldquoChina Warns on US Tiesrdquo Front Page and Page 2 Australian Financial Review 16 January 2013

P a g e | 10

elements in Chinarsquos so-called ldquoString of Pearlsrdquo (Booz Allen Hamilton) strategic policy to protect its sea lines of communication19

It is theoretically possible China may yet construct a naval base in the Arabian Gulf The rogue state Iran may provide fortuitous assistance with a revamp of the port of Bandar Abbas directly opposite the Musandam Peninsula at the very throat of the jugular Strait of Hormuz

A Chinese naval presence in an Iranian port or in a southern Arabian port (ie Aden andor Bashayer Harbour at Port Sudan) would be a very interesting development China needs to keep its trade routes to Arabia and Africa open and safe from blockade or military interdiction

Iran has announced the inauguration of its newest naval base located near Bandar-e-Lengah only some 200 kms from the main naval base at Bandar Abbas20 Iran has stated the new base is being used to place reciprocal pressure on Western Governments Public statements by Iranian Navy officials suggest that the IRIN is endeavouring to extend its reach within the area bounded by four strategic maritime chokepoints the Strait of Hormuz the Strait of Malacca the Bab al-Mandeb and the Suez Canal (Middle East Institute) Iranrsquos expanded maritime capacity might be enough to economically disrupt the West

Given the massive US and other Western Naval fleet presence in the area it would be difficult for the Iranian Navy to extend its influence beyond the Arabian Gulf or even its territorial waters

Nonetheless the Iranian Navy is likely to be supplied from Russia with advanced cruise missiles with a range of 300 km In late April this year Iranian Defence Minister Brigadier General Ahmad Vahidi announced plans to unveil new ballistic and cruise missiles as well as other new military achievements within the next five months21

The increasing militarism within Iran has accelerated a new arms race in the Arabian Gulf region

Iran continues to defy the West with its perceived intention to develop enriched uranium and the capability to manufacture nuclear weapons In assessing the ballistic missile threat a key issue is estimating how long it may take countries like Iran (and North Korea) to build missiles that could carry a nuclear warhead sized payload to the US22

19 Hayward (Rtd) CAPT David L O ldquoChina in the Indian Ocean ndash A Case of Uncharted Watersrdquo Strategic Analysis Paper (SAP) Future Directions International (FDI) 2010-7-05 Postedarchived to wwwfuturedirectionsorgau 20 Mendiolaza Gustavo ldquoAggression or Defence New Iranian Naval Base in Strait of Hormuzrdquo Strategic Weekly Analysis Future Directions International (FDI) 14 Nov 2012 wwwfuturedirectionsorgau 21 ldquoIran Navy to Get Advanced Cruise Missilesrdquo Ria Novosti posted in ldquoMissile Threatrdquo George C Marshall and Claremont Institutes by Editor on 13 May 2013 Downloaded and printed 1900 hrs AEST Australia22 Economist Reader ldquoTimeline for an Iranian solid-fuel ICBMrdquo accessed through Linkedin 12 February 2013

P a g e | 11

Steven Hildreth an expert in missile defence has closely examined Iranrsquos ballistic missile and space launch capabilities23

Expanding Chinese Navy

China is deep into the process of creating its strongest navy since that built and commanded by Zheng He the famous admiral who led seven major expeditions to the far reaches of the Indian Ocean in the early 16th century In fact PLAN composition and capabilities are markedly different from previous major naval construction programs conducted by emerging world powers Chinarsquos new navy relies more on unmanned cruise and ballistic missiles than on manned aircraft and more on submarines than surface vessels24

Storm warnings have been sounded by VADM Doug Crowder US Navy (Rtd) ldquo the PLAN has begun to operate more as a blue-water navy moving surely and steadily beyond its coastal roots and demonstrating concepts of operations to go along with technologies that result in a clear focus on anti-access and area denial in the Western Pacificrdquo25

Aided by increased budgets and improved domestic shipbuilding capabilities the PLAN is making significant progress in its modernization efforts This includes unprecedented procurement in recent years of seven classes of modern destroyers and frigates five classes of submarines (two of which are nuclear powered) and other force enhancements such as three types of capable maritime interdiction aircraft fast missile boats and amphibious warfare ships

The present deployment of the Chinese Navy in ASEAN and Northern Indian Ocean waters is not discussed here However PLAN initiatives to protect its oil umbilical from the Middle East are discussed in another paper26

In its own backyard PLAN developments at Yulin Navy Base (Hainan Island) and at Sansha (prefecture-level city) to administer more than 200 islets in the Spratly (Nansha) Macclesfield Bank (Zhongsha) and the Paracel Islands (Xisha) are not treated in this paper27 Nor is the present conflict between China and Japan over the disputed SenkakuDiaoyu islands in the Dong Hai (East China Sea) discussed

Chinese Missiles

The Pentagon has issued a strategic map detailing Chinarsquos new ldquoCircles of lsquoInfluencersquordquo in SE Asia and beyond that is the ultimate ranges of the Peoplersquos Liberation Armyrsquos short medium and long range missiles (ie DF-11 and DF-15

23 Hildreth Steven A ldquoIranrsquos Ballistic Missile and Space Launch Programsrdquo 66-pages Congressional Research Service (CRS) 6 December 2012 7-5700 wwwcrsgov Email shildrethcrslocgov 7-7635 Refer to Figures 2 and 4 pages 16 and 22 respectively for SRBM and MRBM Sites and Ranges24 Saunders Phillip Young Christopher Swaine Michael and Yang Andrew Nien-Dzu ldquoThe Chinese Navy ndash Expanding Capabilities Evolving Rolesrdquo National Defense University Press Institute for National Strategic Studies WASHINGTON DC December 2011 25 Crowder VADM Doug ldquoStorm Warningsrdquo posted (Blog) by US Naval Institute (USNI) Proceedings Magazine 2012-4-15 refer to wwwusniorg 26 Ibid see footnote 1727 Cole Michael J ldquoChina Deploying Military Garrison to South China Seardquo The Diplomat (Blogs) Flashpoints 2012-07-23

P a g e | 12

SRBM (375 miles) DF-21 ASBM and MRBM CJ-10 LACM FB-7 and B-6 both with ASCM (900 miles) and DF-3 and B-6 with LACM (2000 miles)28

Short and medium range missiles are referred to as ldquotheatrerdquo ballistic missiles presumably earmarked for usage in the Sea of Japan Huang Hai (Yellow Sea) Dong Hai (East China Sea) Western Pacific Nan Hai (South China Sea) and Strait of Malacca

Chinarsquos new found ability to reach and strike designated targets within its declared 2000 mile radius limit also includes the Arabian Gulf Strait of Hormuz Gulf of Oman Bay of Bengal and northern Indian Ocean

China will not of course interrupt its own oil supply but will if necessary attack Western naval assets (warships OPV and port infrastructure) This is not entirely logical If China were to attack a USAllied ship in the Indian Ocean it could not only result in its oil from Arabia being blocked but also in a potential blockade on allmuch trade China can do far more damageapply influence with cyber-leverage trade embargoes and financial disruption

China imports significant oil from Iran and wants to keep the Strait of Hormuz open to its own transit shipments Some military analysts assert that the Chinese airforce and navy defence lsquoumbrellarsquo does not extend to protecting its global oil supply west of the Strait of Malacca29 Missiles however make up for the shortfall

It is difficult to comprehensively assess the full inventory of Chinese missiles Conflicting statistics for missile classes and numbers obtain namely from the International Institute of Strategic Studies (IISS) and the US DOD Annual PRC Military Report - both sources were released in 2010

It must be said that in addition to the missile classes mentioned above China definitely has at least seven classes of land-based and submarine launched inter-continental range ballistic missiles (ICBMs)30 Defence analysts believe China is currently in the middle of a major strategic nuclear forces build-up that includes four new ICBMs ndash the DF-41 JL-2 (Julang-2) DF-31A and another road-mobile missile called the DF-31 Some of these lethal missiles can be armed with multiple independently-targetable warheads (MIRVs) The modified DF-5A ICBM is thought to have a range of 15000 km and is capable of striking targets in continental US Russia and Europe quoted in Russian media 2012-12-04

Recent secret missile tests held in the Wuzhai Space and Missile Test Centre in Shanxi Province represent a new level of capability for Chinarsquos nuclear forces The total number of missile classes held by China is not known Estimates of missile numbers wildly fluctuate from 1300 to over 4000 missiles It is believed at least 1000 SRBM MRBM and ASCM are directly aimed at Taiwan and a similar class

28 Source Office of the US Secretary of Defense29 PLAN has deployed warships to the Gulf of Aden to assist in combating Somali pirates30 Seven classes of Chinese ICBM include DF-41 (new) DF-31A DF-31 DF-5A DF-5 DF-4 and Julang-2 (submarine launched) plus three classes of intermediate range missiles DF-16 DF-3A and DF-3

P a g e | 13

mix of some 800 missiles aimed at ASEAN countries Japan and South Korea Numbers of missiles targeted at India are not known

Oil supply to India ASEAN countries Australasia Japan and South Korea is thus gravely threatened by missile interdiction Australasia is not beyond the range of Chinese ICBM missiles

China is ranked second worldwide by its oil imports

ldquoArab Springrdquo Impact upon Oil Supply

To digress from China briefly the ldquoArab Springrdquo merits attention The political unrest in the Middle East has marginally reduced global oil supply This has led to mixed results amongst Arab countries

In the wake of the Arab Spring the non-oil economies of Egypt and Tunisia have suffered through budgetary constraints slower growth political uncertainty and declining tourism The same thing has happened but to a lesser extent to Jordan Lebanon and Morocco Higher oil prices have impacted upon household budgets Outside help for these economies is forthcoming from the IMF and the World Bank as well as from bilateral lenders such as the EU US and oil rich Saudi Arabia

In contrast to the generally depressed picture across the Arab worldrsquos non-oil economies oil producers such as Algeria Iran Iraq Kuwait Libya Oman Sudan Saudi Arabia and UAE have benefited from increases in oil prices Nowhere has this been more apparent than in Saudi Arabia King Abdullah bin Abdel-Aziz al-Saud recently announced lsquogiveawayrsquo largesse totalling a huge US$ 129 billion (equivalent to 30 of GDP) Kuwait has provided a smaller handout worth US$3700 to every citizen and has distributed free food

Other oil producers such as Bahrain Syria Yemen and Libya are facing twelve months or more of economic hardship in the wake of widespread domestic unrest For instance the Yemeni economy has contracted in the face of mass protests worsening violence and the ongoing interruption to oil supplies caused by sabotage and staff strikes In Libya oil production has shut down Libyarsquos loss is likely to be Iraqrsquos gain With Libya sidelined and oil prices set to remain elevated Iraq which has already signed a host of large deals to develop and repair its underdeveloped oil resources is now poised to take up the slack Iran has by-passed the US and European trade sanctions by supplying more oil to China

Syria is the only significant crude oil producing Arab state in the Eastern Mediterranean region which includes Gaza Lebanon Israel the West Bank and Jordan BP Plc estimates Syria holds the ninth-largest oil reserves in the Middle East (approximately 25 billion barrels as of January 2010) Crude production peaked at 0596 MMbblday in 1995 but declined to less than 0140 MMbblday in August 2012

As stated elsewhere Iran is an ever present threat to political and military stability in the Middle East Funded by increasing oil revenues from China Iran is progressing towards greatly increased militarism In direct retaliation to US hosted multi-nation

P a g e | 14

war games in the Gulf of OmanArabian Sea Iran decided to stage massive military manoeuvres of its own Not to be outdone Iran showcased its exercises as the biggest air defence war game in the Islamic Republicrsquos history

The current deployment of the Iranian Navy is not discussed in detail in this paper

It would be appropriate to take a snapshot of Middle East oil production before and after the Arab Spring Pluses and minuses would be apparent for the oil producers but in the main it is assumed total oil supply was slightly reduced at the onset of the Arab Spring It is theoretically possible that Kuwait Saudi Arabia and the UAE will now have increased oil production to compensate for Libya Iraq Syria and perhaps Sudan to return global oil supply to status quo

Some valuable research work has been undertaken by the Oxford Institute for Energy Studies A recent paper closely examines the implications of the Arab uprisings for oil and gas markets31

Syrian Civil War

The civil war in Syria has reached genocidal proportions It has disrupted if not shut down oil flow through the pipelines transiting the country Some oil terminals pumping stations fuel depots and service stations are damaged or beyond immediate repair Very little petrol is available at bowsers Rebels have captured two major oilfields in the south-eastern province of Deir al-Zour Syria has two major refineries at Homs and Banias The Homs refinery and its feeder pipelines have been attacked at least three times by ldquoterroristrsquo groups and allegedly by the Syrian Army Production is severely curtailed Total chaos prevails

Several proposals to build new oil refineries in Syria have been recently mooted by Iran and Venezuela (Agreement signed in Tehran) by Noor a Kuwait company and by the China National Petroleum Corporation (CNPC) The Chinese corporation commenced construction near Abu Khashab in 2011 but work is delayed due to the civil war

Conjecture as to why China and Russia continue to protect Syria from Western intervention is open to question

Russia considers Syria to be one of its last Middle East footholds where Syria hosts a repair and maintenance facility for the Russian Navy on its coast Russia has remained silent on the issue of a recent oil-for-oil products swap deal which implies economic support for the Assad regime There is also the prospect of new oil and gas field discoveries Again Russia has supplied copious quantities of light arms heavy weapons missiles and munitions to the Syrian government Arms contracts with Russia are worth at least $4 billion Iran China and North Korea have also supplied missiles

China Iran and Russia have substantial economic interests in Syria

31 Hakim Darbouche and Bassam Fattouh paper entitled ldquoThe Implications of the Arab Uprisings for Oil and Gas Marketsrdquo Oxford Institute for Energy Studies University of Oxford September 2011 ISBN 978-1-907555 ndash 33 - 6

P a g e | 15

Syria has at least six main classes of ballistic missile for which there are an estimated eleven variants These include three variants of the Scud missile (1) Scud-B (Russia R17 ldquoElbrusrdquoNATO SS-1-C) from North Korea (2) Scud-C (SS-1-D) and (3) Scud-D (Russia R-17VTONATO SS-1-EDPRK Hwasong 7 The Scud-D has a guidance system and a range of 700 km Additionally Syria has two Chinese made road-mobile SRBMs the Dong Feng-15 and the Dong Feng-11 The DF-15 has a range of 600 to 800 km and is Syriarsquos most strategically important ballistic missile Other missiles in the arsenal include the Fateh-110 (Iran) SS-21 (North Korea) and a small number of Russian anti-ship cruise missiles (ASCM) designed for coastal defence All Syriarsquos ballistic missiles are capable of carrying chemical warheads

The precise attributes of these missile classes are beyond the scope of this paper

It is impossible to exactly calculate the classes variants and numbers of missiles possessed by Syria Unknown to the West the Assad regime may have concealed secret inventories hidden away in remote silos tunnels and caves

In addition to missile systems Syria is thought to have substantial inventories of 220mm and 302mm rocket systems Syria has supplied 25 per cent of its rocket arsenal to Hezbollah in southern Lebanon Hezbollah has now emerged as a non-state rocket superpower32

During the civil war at least twenty launches of ballistic missiles have been detected by NATO radar installations in nearby Turkey

Syria has one of the most active rocket and missile programs in the Middle East today The country is of real concern to Western military analysts Once the Assad regime is in its death throes it could act irrationally strike out at neighbouring oil refineries oil infrastructure pipelines oil tankers and the Suez Canal

Israel

In January 2013 Israeli Prime Minister Binyamin Netanyahu warned his governmentof the dangers of Syriarsquos growing missile inventories that Syria is rapidly fragmenting and its political system is falling apart In response in the same month the Israeli air force launched a pre-emptive air strike on a military site within Syria The target was a truck convey believed to contain a shipment of Russian-made SA-17 anti-aircraft missiles Collateral damage was also sustained to a military research centre located at Jamraya close to the Turkish border33 Iran has vowed revenge for this attack

For its part Israel may be forced to launch additional pre-emptive air strikes

Theoretical Outcomes

32 Eisenstadt Michael ldquoThe Middle East Missile Environmentrdquo Defense Dossier American Foreign policy Council (AFPC) Issue 6 January 2013 subscribed to and downloaded from AFPC33 Hubbard Ben ldquoIsraeli air strike inside Syria targets missilesrdquo World page 37 Australian Financial Review Friday 1 February 2013

P a g e | 16

The West has not been able to stop the carnage in Syria by means of a political economic or military solution

Theoretical outcomes from the civil war include (1) birth of a new pro-Iran Islamic state or (2) creation of a new politically weak state with no discernible allegiance to either East or West or (3) a new totalitarian state contrived by a strong IranianRussian comprehensive political economic and military takeover or (4) a Middle East State troops deployment within Syria to act as arbitrator (possibly from Saudi Arabia or Kuwait or UAE or a combination of Gulf Cooperative Council (GCC) States) for a onetwo year period or (5) coupled with the establishment of a ldquoNo Flyrdquo Zone deployment of UN peacekeeper troops to separate and quell the rebel fractions and possibly to support the Syrian Armed Forces or (6) legal censure of the war crimes committed by all fractions and commencement of due international legal process to charge arrest and intern offenders or (7) escalation of the civil war into a new conflict with Israel partly encircled as it is with SRBMMRBM based on the Gaza Strip in South Lebanon Syria and Iran or (8) further conflict with Turkey if more inaccurate Scud missiles launched in Syria stray over the border into refugee camps or Turkish villages Turkish troops could well take reprisals and (9) potential for a civil war to break out in Turkey destabilizing the current regime

Whatever the outcome the West believes the Assad regime will soon be toppled and the present incumbents charged with war crimes This could be regarded as a deus ex machina solution It is idealistic and it may never happen

All of the possible outcomes except for (4) above are disadvantageous to the West especially the potential for outbreaks of unwanted new regional wars Thus far it has not been possible to instigate a ldquoNo Flyrdquo Zone China and Russia have constantly vetoed this pro tem solution The crisis constitutes a ldquoflashpointrdquo which could embroil the entire Middle East and ultimately lead to WWIII Political dialoguenegotiations must and are continuing in an urgent attempt to solve the internal multi-faceted issues and to foster a moratorium to put a stop to the civil war

The West must do something Some military analysts suggest France Germany and the UK should go it alone invade Syria and put lsquoboots on the groundrsquo This hardline action would be disastrous and is evocative of the Suez crisis in 1956

A NATO or European Union lsquoboots on the groundrsquo option is a no-go for many reasons not the least the lessons learned from Iraq Afghanistan and Libya ndash no more lsquoinfidel invaderrsquo options The Syrian Crisis must be resolved by the countries in the region with lsquominimal crusaderrsquo support The West needs to find a lsquosmart powerrsquo solution without committing combat troops

In Washington DC the American Foreign Policy Council (AFPC) is working hard with members of US Congress the Executive Branch the US policymaking community other government agencies and Western governments to come up with a satisfactory answer to mitigate the Syrian crisis

Russia and the US between them might yet save the day with their proposed Peace Conference but this now seems unlikely The imminent deployment of Russian

P a g e | 17

surface to air (SAM) S-300 missiles to Syria has heightened tension34 Likewise the possibility that France and the UK will supply weapons to the Syrian opposition coalitionrebels may bring peace negotiations to an abrupt halt

Perhaps the West is powerless to solve the deepening crisis situation Is it game set and match to Syria Iran Russia and China

Substantial research on the Syrian Crisis is currently being prepared by The Intelligence Community LLC located in Washington DC35

Western Reaction

Just as before as in the late 1970rsquos the West has again reacted angrily to increasing militarism and political unrest alongside the main oil transit routes from the Arabian Gulf eastwards to India ASEAN China Taiwan Japan South Korea Australasia and other oil-consumer nations in the Western Pacific

New air-sea-battle lines are emerging to counter Iranrsquos continued intransigence in areas such as nuclear weapons proliferation Chinarsquos ldquoString of Pearlsrdquo lsquoanti-accessrsquo and lsquoarea-denialrsquo maritime stratagems

Counter measures include (1) the deployment of supercarriers by the US Fifth Fleet to the Middle East (2) upgrades to Diego Garcia and to Bahrain36 (3) procurement by Arab states of 100 plus Euro Typhoon fighter aircraft to counter IRIN and IRGCN initiatives to gain maritime sea control in the Strait of Hormuz (4) the future deployment of additional supercarriers by the US Seventh Fleet in SE Asia37 (5) reactivation of Cam Ranh Bay naval base in Vietnam38 (6) construction of INS Kadamba in India39 (7) improved ship repair facilities at Changi naval base in Singapore40 (8) deployment of US marines to Darwin (9) redeployment of 80000 US troops to Guam and (10) supply of a new missile defence X-Brand radar system to Japan and possibly elsewhere in SE Asia41

34 Some academics assert the Russian SAM missiles have already been deployed For example in the article ldquoRussiarsquos S-300 Surface to Air Missiles already deployed and functional in Syriardquo by Professor Michel Chossudovsky Global research 30 May 2013 Refer to Web site globalresearchca This may not be strictly true for the designated missile variant However Moscow announced in June 2006 that it would deploy the older S-300PMU air defense to protect its maintenance naval base at Tartus in southern SyriaSee alsordquoIsrael could swoop on S-300 missiles in Syria but with more risksrdquo by Don Williams Reuters Jerusalem on Thursday 30 May 201335 ldquoSyria Policy Playbookrdquo contains enough material to write two entire books Deadline for additional submissions from Linkedin members has now been extended by The Intelligence Community to Tuesday 4 June 2013 Refer to wwwTheIntelligenceCommunitycom36 Bahrain is now called Naval Support Activity Bahrain (NSA Bahrain) It is home to US Naval forces Central Command and the US Fifth Fleet37 This intended deployment represents about 60 of total US naval assets Deployment will be in the Northern Indian Ocean Nan Hai Dong Hai Yellow Sea Sea of Japan and Western Pacific38 Redeveloped to permit entry and bunkering facilities for Western warships Dominates the Nan Hai and effectively replaces the abandoned US Subic Bay naval base in the Philippines39 New naval base on the Indian sub Continent south of Goa40 Changi naval base is now able to berth US Nimitz Class supercarriers In the future the base may be able to accommodate the new Ford Class supercarriers The ldquoGerald R Fordrdquo (CVN-78) is under construction and is due to be commissioned in 201541 To contain threats from North Korea and counter Chinarsquos growing missile capabilities the US has announced its intention to deploy a new missile defence shield in Japan and Asia The resulting radar arc would cover

P a g e | 18

The impending global deployment of X-Brand radar systems is treated in more detail later in this paper

US Navy Deployment

Just as in the Gulf Tanker War the US Navy has urgently deployed carrier battle groups to the Arabian Gulf and to the Gulf of Oman It was decided recently that the US Navy should always have at least two rotational carrier battle groups in the area

Given the drive by the US to become less reliant on imported oil its fiscal pressures on the military (defence budget sequestration) refits and the rising focus around the lsquoChina Seasrsquo (viz lsquoAsia-Pivotrsquo diplomacy) it may not be possible to ramp up US Navy assets in the Arabian Gulf and Indian Ocean Greater use of airborne surface and sub-surface RPVs would provide more flexible persistent and wider-area ISTAR capability to keep the lsquooil umbilicalrsquo under surveillance

With the current diplomatic impasse between Israel and Iran the stakes have risen Warships from 25 nations recently converged on the Strait of Hormuz as Israel and Iran moved towards the brink of war Ostensibly the deployment was for the largest war games ever held in the region Three US supercarrier battle groups took part in the war games comprising USS ldquoAbraham Lincolnrdquo (CVN-72) USS ldquoJohn C Stennisrdquo (CVN-74) and USS ldquoCarl Vinsonrdquo (CV-65) The three Nimitz Class supercarriers each have more than the entire complement of the Iranian airforce

Earlier in 2012 there were four US carrier groups in the region when the USS ldquoEnterpriserdquo (CV-65) visited the Arabian Gulf

The US Navyrsquos recently announced intention to deploy additional supercarriers in SE Asian and Western Pacific waters may yet prove to be nothing more than media rhetoric Severe ldquosequestrationrdquo cuts to the US defense budget proposed for January 2013 may obviate the intended deployment42 At the present time only two carriers are deployed namely the ldquoGeorge Washingtonrdquo (CVN-71) and ldquoJohn C Stennisrdquo (CVN-74) in the Western Pacific43

Official sources at the US DOD in Washington deny there will be any cut back in the future deployment of supercarriers to the Western Pacific But to the contrary Cesare Marchetti in his mathematical model suggests post-sequestration funding shortfalls will prevent the US from successfully ramping-up to support the next war funding effort possibly in 2027 or earlier44 It remains to be seen if the US Navy will be able to assume a dominant presence in the Western Pacific in future decades

This month the ldquoWashington Timesrdquo reported US Marines will serve long deployments for the next few years because of ongoing crises in the Middle East and

North Korea China Taiwan and possibly some ASEAN countries Michael Moore ldquoThe Telegraphrdquo 2012-11-02 and Shaun waterman ldquoWashington Timesrdquo 2012-9-17 42To quote lsquo the US DOD will cut more than $1 trillion out of the defense budget over the next decadersquo Carroll Chris ldquoStars and Stripesrdquo reporting for ldquoStripes Centralrdquo Washington 2012-11-0243 Stratfor Naval Update 2012-09-2644 Marchetti Cesare Victor Strategy Inc (Southern Pines NC) see his findings using a logisticdiffusion mathematical model posted in ldquoComposites World (CW) Industry News 2012-11-02 refer to wwwvector-strategycom

P a g e | 13

mix of some 800 missiles aimed at ASEAN countries Japan and South Korea Numbers of missiles targeted at India are not known

Oil supply to India ASEAN countries Australasia Japan and South Korea is thus gravely threatened by missile interdiction Australasia is not beyond the range of Chinese ICBM missiles

China is ranked second worldwide by its oil imports

ldquoArab Springrdquo Impact upon Oil Supply

To digress from China briefly the ldquoArab Springrdquo merits attention The political unrest in the Middle East has marginally reduced global oil supply This has led to mixed results amongst Arab countries

In the wake of the Arab Spring the non-oil economies of Egypt and Tunisia have suffered through budgetary constraints slower growth political uncertainty and declining tourism The same thing has happened but to a lesser extent to Jordan Lebanon and Morocco Higher oil prices have impacted upon household budgets Outside help for these economies is forthcoming from the IMF and the World Bank as well as from bilateral lenders such as the EU US and oil rich Saudi Arabia

In contrast to the generally depressed picture across the Arab worldrsquos non-oil economies oil producers such as Algeria Iran Iraq Kuwait Libya Oman Sudan Saudi Arabia and UAE have benefited from increases in oil prices Nowhere has this been more apparent than in Saudi Arabia King Abdullah bin Abdel-Aziz al-Saud recently announced lsquogiveawayrsquo largesse totalling a huge US$ 129 billion (equivalent to 30 of GDP) Kuwait has provided a smaller handout worth US$3700 to every citizen and has distributed free food

Other oil producers such as Bahrain Syria Yemen and Libya are facing twelve months or more of economic hardship in the wake of widespread domestic unrest For instance the Yemeni economy has contracted in the face of mass protests worsening violence and the ongoing interruption to oil supplies caused by sabotage and staff strikes In Libya oil production has shut down Libyarsquos loss is likely to be Iraqrsquos gain With Libya sidelined and oil prices set to remain elevated Iraq which has already signed a host of large deals to develop and repair its underdeveloped oil resources is now poised to take up the slack Iran has by-passed the US and European trade sanctions by supplying more oil to China

Syria is the only significant crude oil producing Arab state in the Eastern Mediterranean region which includes Gaza Lebanon Israel the West Bank and Jordan BP Plc estimates Syria holds the ninth-largest oil reserves in the Middle East (approximately 25 billion barrels as of January 2010) Crude production peaked at 0596 MMbblday in 1995 but declined to less than 0140 MMbblday in August 2012

As stated elsewhere Iran is an ever present threat to political and military stability in the Middle East Funded by increasing oil revenues from China Iran is progressing towards greatly increased militarism In direct retaliation to US hosted multi-nation

P a g e | 14

war games in the Gulf of OmanArabian Sea Iran decided to stage massive military manoeuvres of its own Not to be outdone Iran showcased its exercises as the biggest air defence war game in the Islamic Republicrsquos history

The current deployment of the Iranian Navy is not discussed in detail in this paper

It would be appropriate to take a snapshot of Middle East oil production before and after the Arab Spring Pluses and minuses would be apparent for the oil producers but in the main it is assumed total oil supply was slightly reduced at the onset of the Arab Spring It is theoretically possible that Kuwait Saudi Arabia and the UAE will now have increased oil production to compensate for Libya Iraq Syria and perhaps Sudan to return global oil supply to status quo

Some valuable research work has been undertaken by the Oxford Institute for Energy Studies A recent paper closely examines the implications of the Arab uprisings for oil and gas markets31

Syrian Civil War

The civil war in Syria has reached genocidal proportions It has disrupted if not shut down oil flow through the pipelines transiting the country Some oil terminals pumping stations fuel depots and service stations are damaged or beyond immediate repair Very little petrol is available at bowsers Rebels have captured two major oilfields in the south-eastern province of Deir al-Zour Syria has two major refineries at Homs and Banias The Homs refinery and its feeder pipelines have been attacked at least three times by ldquoterroristrsquo groups and allegedly by the Syrian Army Production is severely curtailed Total chaos prevails

Several proposals to build new oil refineries in Syria have been recently mooted by Iran and Venezuela (Agreement signed in Tehran) by Noor a Kuwait company and by the China National Petroleum Corporation (CNPC) The Chinese corporation commenced construction near Abu Khashab in 2011 but work is delayed due to the civil war

Conjecture as to why China and Russia continue to protect Syria from Western intervention is open to question

Russia considers Syria to be one of its last Middle East footholds where Syria hosts a repair and maintenance facility for the Russian Navy on its coast Russia has remained silent on the issue of a recent oil-for-oil products swap deal which implies economic support for the Assad regime There is also the prospect of new oil and gas field discoveries Again Russia has supplied copious quantities of light arms heavy weapons missiles and munitions to the Syrian government Arms contracts with Russia are worth at least $4 billion Iran China and North Korea have also supplied missiles

China Iran and Russia have substantial economic interests in Syria

31 Hakim Darbouche and Bassam Fattouh paper entitled ldquoThe Implications of the Arab Uprisings for Oil and Gas Marketsrdquo Oxford Institute for Energy Studies University of Oxford September 2011 ISBN 978-1-907555 ndash 33 - 6

P a g e | 15

Syria has at least six main classes of ballistic missile for which there are an estimated eleven variants These include three variants of the Scud missile (1) Scud-B (Russia R17 ldquoElbrusrdquoNATO SS-1-C) from North Korea (2) Scud-C (SS-1-D) and (3) Scud-D (Russia R-17VTONATO SS-1-EDPRK Hwasong 7 The Scud-D has a guidance system and a range of 700 km Additionally Syria has two Chinese made road-mobile SRBMs the Dong Feng-15 and the Dong Feng-11 The DF-15 has a range of 600 to 800 km and is Syriarsquos most strategically important ballistic missile Other missiles in the arsenal include the Fateh-110 (Iran) SS-21 (North Korea) and a small number of Russian anti-ship cruise missiles (ASCM) designed for coastal defence All Syriarsquos ballistic missiles are capable of carrying chemical warheads

The precise attributes of these missile classes are beyond the scope of this paper

It is impossible to exactly calculate the classes variants and numbers of missiles possessed by Syria Unknown to the West the Assad regime may have concealed secret inventories hidden away in remote silos tunnels and caves

In addition to missile systems Syria is thought to have substantial inventories of 220mm and 302mm rocket systems Syria has supplied 25 per cent of its rocket arsenal to Hezbollah in southern Lebanon Hezbollah has now emerged as a non-state rocket superpower32

During the civil war at least twenty launches of ballistic missiles have been detected by NATO radar installations in nearby Turkey

Syria has one of the most active rocket and missile programs in the Middle East today The country is of real concern to Western military analysts Once the Assad regime is in its death throes it could act irrationally strike out at neighbouring oil refineries oil infrastructure pipelines oil tankers and the Suez Canal

Israel

In January 2013 Israeli Prime Minister Binyamin Netanyahu warned his governmentof the dangers of Syriarsquos growing missile inventories that Syria is rapidly fragmenting and its political system is falling apart In response in the same month the Israeli air force launched a pre-emptive air strike on a military site within Syria The target was a truck convey believed to contain a shipment of Russian-made SA-17 anti-aircraft missiles Collateral damage was also sustained to a military research centre located at Jamraya close to the Turkish border33 Iran has vowed revenge for this attack

For its part Israel may be forced to launch additional pre-emptive air strikes

Theoretical Outcomes

32 Eisenstadt Michael ldquoThe Middle East Missile Environmentrdquo Defense Dossier American Foreign policy Council (AFPC) Issue 6 January 2013 subscribed to and downloaded from AFPC33 Hubbard Ben ldquoIsraeli air strike inside Syria targets missilesrdquo World page 37 Australian Financial Review Friday 1 February 2013

P a g e | 16

The West has not been able to stop the carnage in Syria by means of a political economic or military solution

Theoretical outcomes from the civil war include (1) birth of a new pro-Iran Islamic state or (2) creation of a new politically weak state with no discernible allegiance to either East or West or (3) a new totalitarian state contrived by a strong IranianRussian comprehensive political economic and military takeover or (4) a Middle East State troops deployment within Syria to act as arbitrator (possibly from Saudi Arabia or Kuwait or UAE or a combination of Gulf Cooperative Council (GCC) States) for a onetwo year period or (5) coupled with the establishment of a ldquoNo Flyrdquo Zone deployment of UN peacekeeper troops to separate and quell the rebel fractions and possibly to support the Syrian Armed Forces or (6) legal censure of the war crimes committed by all fractions and commencement of due international legal process to charge arrest and intern offenders or (7) escalation of the civil war into a new conflict with Israel partly encircled as it is with SRBMMRBM based on the Gaza Strip in South Lebanon Syria and Iran or (8) further conflict with Turkey if more inaccurate Scud missiles launched in Syria stray over the border into refugee camps or Turkish villages Turkish troops could well take reprisals and (9) potential for a civil war to break out in Turkey destabilizing the current regime

Whatever the outcome the West believes the Assad regime will soon be toppled and the present incumbents charged with war crimes This could be regarded as a deus ex machina solution It is idealistic and it may never happen

All of the possible outcomes except for (4) above are disadvantageous to the West especially the potential for outbreaks of unwanted new regional wars Thus far it has not been possible to instigate a ldquoNo Flyrdquo Zone China and Russia have constantly vetoed this pro tem solution The crisis constitutes a ldquoflashpointrdquo which could embroil the entire Middle East and ultimately lead to WWIII Political dialoguenegotiations must and are continuing in an urgent attempt to solve the internal multi-faceted issues and to foster a moratorium to put a stop to the civil war

The West must do something Some military analysts suggest France Germany and the UK should go it alone invade Syria and put lsquoboots on the groundrsquo This hardline action would be disastrous and is evocative of the Suez crisis in 1956

A NATO or European Union lsquoboots on the groundrsquo option is a no-go for many reasons not the least the lessons learned from Iraq Afghanistan and Libya ndash no more lsquoinfidel invaderrsquo options The Syrian Crisis must be resolved by the countries in the region with lsquominimal crusaderrsquo support The West needs to find a lsquosmart powerrsquo solution without committing combat troops

In Washington DC the American Foreign Policy Council (AFPC) is working hard with members of US Congress the Executive Branch the US policymaking community other government agencies and Western governments to come up with a satisfactory answer to mitigate the Syrian crisis

Russia and the US between them might yet save the day with their proposed Peace Conference but this now seems unlikely The imminent deployment of Russian

P a g e | 17

surface to air (SAM) S-300 missiles to Syria has heightened tension34 Likewise the possibility that France and the UK will supply weapons to the Syrian opposition coalitionrebels may bring peace negotiations to an abrupt halt

Perhaps the West is powerless to solve the deepening crisis situation Is it game set and match to Syria Iran Russia and China

Substantial research on the Syrian Crisis is currently being prepared by The Intelligence Community LLC located in Washington DC35

Western Reaction

Just as before as in the late 1970rsquos the West has again reacted angrily to increasing militarism and political unrest alongside the main oil transit routes from the Arabian Gulf eastwards to India ASEAN China Taiwan Japan South Korea Australasia and other oil-consumer nations in the Western Pacific

New air-sea-battle lines are emerging to counter Iranrsquos continued intransigence in areas such as nuclear weapons proliferation Chinarsquos ldquoString of Pearlsrdquo lsquoanti-accessrsquo and lsquoarea-denialrsquo maritime stratagems

Counter measures include (1) the deployment of supercarriers by the US Fifth Fleet to the Middle East (2) upgrades to Diego Garcia and to Bahrain36 (3) procurement by Arab states of 100 plus Euro Typhoon fighter aircraft to counter IRIN and IRGCN initiatives to gain maritime sea control in the Strait of Hormuz (4) the future deployment of additional supercarriers by the US Seventh Fleet in SE Asia37 (5) reactivation of Cam Ranh Bay naval base in Vietnam38 (6) construction of INS Kadamba in India39 (7) improved ship repair facilities at Changi naval base in Singapore40 (8) deployment of US marines to Darwin (9) redeployment of 80000 US troops to Guam and (10) supply of a new missile defence X-Brand radar system to Japan and possibly elsewhere in SE Asia41

34 Some academics assert the Russian SAM missiles have already been deployed For example in the article ldquoRussiarsquos S-300 Surface to Air Missiles already deployed and functional in Syriardquo by Professor Michel Chossudovsky Global research 30 May 2013 Refer to Web site globalresearchca This may not be strictly true for the designated missile variant However Moscow announced in June 2006 that it would deploy the older S-300PMU air defense to protect its maintenance naval base at Tartus in southern SyriaSee alsordquoIsrael could swoop on S-300 missiles in Syria but with more risksrdquo by Don Williams Reuters Jerusalem on Thursday 30 May 201335 ldquoSyria Policy Playbookrdquo contains enough material to write two entire books Deadline for additional submissions from Linkedin members has now been extended by The Intelligence Community to Tuesday 4 June 2013 Refer to wwwTheIntelligenceCommunitycom36 Bahrain is now called Naval Support Activity Bahrain (NSA Bahrain) It is home to US Naval forces Central Command and the US Fifth Fleet37 This intended deployment represents about 60 of total US naval assets Deployment will be in the Northern Indian Ocean Nan Hai Dong Hai Yellow Sea Sea of Japan and Western Pacific38 Redeveloped to permit entry and bunkering facilities for Western warships Dominates the Nan Hai and effectively replaces the abandoned US Subic Bay naval base in the Philippines39 New naval base on the Indian sub Continent south of Goa40 Changi naval base is now able to berth US Nimitz Class supercarriers In the future the base may be able to accommodate the new Ford Class supercarriers The ldquoGerald R Fordrdquo (CVN-78) is under construction and is due to be commissioned in 201541 To contain threats from North Korea and counter Chinarsquos growing missile capabilities the US has announced its intention to deploy a new missile defence shield in Japan and Asia The resulting radar arc would cover

P a g e | 18

The impending global deployment of X-Brand radar systems is treated in more detail later in this paper

US Navy Deployment

Just as in the Gulf Tanker War the US Navy has urgently deployed carrier battle groups to the Arabian Gulf and to the Gulf of Oman It was decided recently that the US Navy should always have at least two rotational carrier battle groups in the area

Given the drive by the US to become less reliant on imported oil its fiscal pressures on the military (defence budget sequestration) refits and the rising focus around the lsquoChina Seasrsquo (viz lsquoAsia-Pivotrsquo diplomacy) it may not be possible to ramp up US Navy assets in the Arabian Gulf and Indian Ocean Greater use of airborne surface and sub-surface RPVs would provide more flexible persistent and wider-area ISTAR capability to keep the lsquooil umbilicalrsquo under surveillance

With the current diplomatic impasse between Israel and Iran the stakes have risen Warships from 25 nations recently converged on the Strait of Hormuz as Israel and Iran moved towards the brink of war Ostensibly the deployment was for the largest war games ever held in the region Three US supercarrier battle groups took part in the war games comprising USS ldquoAbraham Lincolnrdquo (CVN-72) USS ldquoJohn C Stennisrdquo (CVN-74) and USS ldquoCarl Vinsonrdquo (CV-65) The three Nimitz Class supercarriers each have more than the entire complement of the Iranian airforce

Earlier in 2012 there were four US carrier groups in the region when the USS ldquoEnterpriserdquo (CV-65) visited the Arabian Gulf

The US Navyrsquos recently announced intention to deploy additional supercarriers in SE Asian and Western Pacific waters may yet prove to be nothing more than media rhetoric Severe ldquosequestrationrdquo cuts to the US defense budget proposed for January 2013 may obviate the intended deployment42 At the present time only two carriers are deployed namely the ldquoGeorge Washingtonrdquo (CVN-71) and ldquoJohn C Stennisrdquo (CVN-74) in the Western Pacific43

Official sources at the US DOD in Washington deny there will be any cut back in the future deployment of supercarriers to the Western Pacific But to the contrary Cesare Marchetti in his mathematical model suggests post-sequestration funding shortfalls will prevent the US from successfully ramping-up to support the next war funding effort possibly in 2027 or earlier44 It remains to be seen if the US Navy will be able to assume a dominant presence in the Western Pacific in future decades

This month the ldquoWashington Timesrdquo reported US Marines will serve long deployments for the next few years because of ongoing crises in the Middle East and

North Korea China Taiwan and possibly some ASEAN countries Michael Moore ldquoThe Telegraphrdquo 2012-11-02 and Shaun waterman ldquoWashington Timesrdquo 2012-9-17 42To quote lsquo the US DOD will cut more than $1 trillion out of the defense budget over the next decadersquo Carroll Chris ldquoStars and Stripesrdquo reporting for ldquoStripes Centralrdquo Washington 2012-11-0243 Stratfor Naval Update 2012-09-2644 Marchetti Cesare Victor Strategy Inc (Southern Pines NC) see his findings using a logisticdiffusion mathematical model posted in ldquoComposites World (CW) Industry News 2012-11-02 refer to wwwvector-strategycom

P a g e | 14

war games in the Gulf of OmanArabian Sea Iran decided to stage massive military manoeuvres of its own Not to be outdone Iran showcased its exercises as the biggest air defence war game in the Islamic Republicrsquos history

The current deployment of the Iranian Navy is not discussed in detail in this paper

It would be appropriate to take a snapshot of Middle East oil production before and after the Arab Spring Pluses and minuses would be apparent for the oil producers but in the main it is assumed total oil supply was slightly reduced at the onset of the Arab Spring It is theoretically possible that Kuwait Saudi Arabia and the UAE will now have increased oil production to compensate for Libya Iraq Syria and perhaps Sudan to return global oil supply to status quo

Some valuable research work has been undertaken by the Oxford Institute for Energy Studies A recent paper closely examines the implications of the Arab uprisings for oil and gas markets31

Syrian Civil War

The civil war in Syria has reached genocidal proportions It has disrupted if not shut down oil flow through the pipelines transiting the country Some oil terminals pumping stations fuel depots and service stations are damaged or beyond immediate repair Very little petrol is available at bowsers Rebels have captured two major oilfields in the south-eastern province of Deir al-Zour Syria has two major refineries at Homs and Banias The Homs refinery and its feeder pipelines have been attacked at least three times by ldquoterroristrsquo groups and allegedly by the Syrian Army Production is severely curtailed Total chaos prevails

Several proposals to build new oil refineries in Syria have been recently mooted by Iran and Venezuela (Agreement signed in Tehran) by Noor a Kuwait company and by the China National Petroleum Corporation (CNPC) The Chinese corporation commenced construction near Abu Khashab in 2011 but work is delayed due to the civil war

Conjecture as to why China and Russia continue to protect Syria from Western intervention is open to question

Russia considers Syria to be one of its last Middle East footholds where Syria hosts a repair and maintenance facility for the Russian Navy on its coast Russia has remained silent on the issue of a recent oil-for-oil products swap deal which implies economic support for the Assad regime There is also the prospect of new oil and gas field discoveries Again Russia has supplied copious quantities of light arms heavy weapons missiles and munitions to the Syrian government Arms contracts with Russia are worth at least $4 billion Iran China and North Korea have also supplied missiles

China Iran and Russia have substantial economic interests in Syria

31 Hakim Darbouche and Bassam Fattouh paper entitled ldquoThe Implications of the Arab Uprisings for Oil and Gas Marketsrdquo Oxford Institute for Energy Studies University of Oxford September 2011 ISBN 978-1-907555 ndash 33 - 6

P a g e | 15

Syria has at least six main classes of ballistic missile for which there are an estimated eleven variants These include three variants of the Scud missile (1) Scud-B (Russia R17 ldquoElbrusrdquoNATO SS-1-C) from North Korea (2) Scud-C (SS-1-D) and (3) Scud-D (Russia R-17VTONATO SS-1-EDPRK Hwasong 7 The Scud-D has a guidance system and a range of 700 km Additionally Syria has two Chinese made road-mobile SRBMs the Dong Feng-15 and the Dong Feng-11 The DF-15 has a range of 600 to 800 km and is Syriarsquos most strategically important ballistic missile Other missiles in the arsenal include the Fateh-110 (Iran) SS-21 (North Korea) and a small number of Russian anti-ship cruise missiles (ASCM) designed for coastal defence All Syriarsquos ballistic missiles are capable of carrying chemical warheads

The precise attributes of these missile classes are beyond the scope of this paper

It is impossible to exactly calculate the classes variants and numbers of missiles possessed by Syria Unknown to the West the Assad regime may have concealed secret inventories hidden away in remote silos tunnels and caves

In addition to missile systems Syria is thought to have substantial inventories of 220mm and 302mm rocket systems Syria has supplied 25 per cent of its rocket arsenal to Hezbollah in southern Lebanon Hezbollah has now emerged as a non-state rocket superpower32

During the civil war at least twenty launches of ballistic missiles have been detected by NATO radar installations in nearby Turkey

Syria has one of the most active rocket and missile programs in the Middle East today The country is of real concern to Western military analysts Once the Assad regime is in its death throes it could act irrationally strike out at neighbouring oil refineries oil infrastructure pipelines oil tankers and the Suez Canal

Israel

In January 2013 Israeli Prime Minister Binyamin Netanyahu warned his governmentof the dangers of Syriarsquos growing missile inventories that Syria is rapidly fragmenting and its political system is falling apart In response in the same month the Israeli air force launched a pre-emptive air strike on a military site within Syria The target was a truck convey believed to contain a shipment of Russian-made SA-17 anti-aircraft missiles Collateral damage was also sustained to a military research centre located at Jamraya close to the Turkish border33 Iran has vowed revenge for this attack

For its part Israel may be forced to launch additional pre-emptive air strikes

Theoretical Outcomes

32 Eisenstadt Michael ldquoThe Middle East Missile Environmentrdquo Defense Dossier American Foreign policy Council (AFPC) Issue 6 January 2013 subscribed to and downloaded from AFPC33 Hubbard Ben ldquoIsraeli air strike inside Syria targets missilesrdquo World page 37 Australian Financial Review Friday 1 February 2013

P a g e | 16

The West has not been able to stop the carnage in Syria by means of a political economic or military solution

Theoretical outcomes from the civil war include (1) birth of a new pro-Iran Islamic state or (2) creation of a new politically weak state with no discernible allegiance to either East or West or (3) a new totalitarian state contrived by a strong IranianRussian comprehensive political economic and military takeover or (4) a Middle East State troops deployment within Syria to act as arbitrator (possibly from Saudi Arabia or Kuwait or UAE or a combination of Gulf Cooperative Council (GCC) States) for a onetwo year period or (5) coupled with the establishment of a ldquoNo Flyrdquo Zone deployment of UN peacekeeper troops to separate and quell the rebel fractions and possibly to support the Syrian Armed Forces or (6) legal censure of the war crimes committed by all fractions and commencement of due international legal process to charge arrest and intern offenders or (7) escalation of the civil war into a new conflict with Israel partly encircled as it is with SRBMMRBM based on the Gaza Strip in South Lebanon Syria and Iran or (8) further conflict with Turkey if more inaccurate Scud missiles launched in Syria stray over the border into refugee camps or Turkish villages Turkish troops could well take reprisals and (9) potential for a civil war to break out in Turkey destabilizing the current regime

Whatever the outcome the West believes the Assad regime will soon be toppled and the present incumbents charged with war crimes This could be regarded as a deus ex machina solution It is idealistic and it may never happen

All of the possible outcomes except for (4) above are disadvantageous to the West especially the potential for outbreaks of unwanted new regional wars Thus far it has not been possible to instigate a ldquoNo Flyrdquo Zone China and Russia have constantly vetoed this pro tem solution The crisis constitutes a ldquoflashpointrdquo which could embroil the entire Middle East and ultimately lead to WWIII Political dialoguenegotiations must and are continuing in an urgent attempt to solve the internal multi-faceted issues and to foster a moratorium to put a stop to the civil war

The West must do something Some military analysts suggest France Germany and the UK should go it alone invade Syria and put lsquoboots on the groundrsquo This hardline action would be disastrous and is evocative of the Suez crisis in 1956

A NATO or European Union lsquoboots on the groundrsquo option is a no-go for many reasons not the least the lessons learned from Iraq Afghanistan and Libya ndash no more lsquoinfidel invaderrsquo options The Syrian Crisis must be resolved by the countries in the region with lsquominimal crusaderrsquo support The West needs to find a lsquosmart powerrsquo solution without committing combat troops

In Washington DC the American Foreign Policy Council (AFPC) is working hard with members of US Congress the Executive Branch the US policymaking community other government agencies and Western governments to come up with a satisfactory answer to mitigate the Syrian crisis

Russia and the US between them might yet save the day with their proposed Peace Conference but this now seems unlikely The imminent deployment of Russian

P a g e | 17

surface to air (SAM) S-300 missiles to Syria has heightened tension34 Likewise the possibility that France and the UK will supply weapons to the Syrian opposition coalitionrebels may bring peace negotiations to an abrupt halt

Perhaps the West is powerless to solve the deepening crisis situation Is it game set and match to Syria Iran Russia and China

Substantial research on the Syrian Crisis is currently being prepared by The Intelligence Community LLC located in Washington DC35

Western Reaction

Just as before as in the late 1970rsquos the West has again reacted angrily to increasing militarism and political unrest alongside the main oil transit routes from the Arabian Gulf eastwards to India ASEAN China Taiwan Japan South Korea Australasia and other oil-consumer nations in the Western Pacific

New air-sea-battle lines are emerging to counter Iranrsquos continued intransigence in areas such as nuclear weapons proliferation Chinarsquos ldquoString of Pearlsrdquo lsquoanti-accessrsquo and lsquoarea-denialrsquo maritime stratagems

Counter measures include (1) the deployment of supercarriers by the US Fifth Fleet to the Middle East (2) upgrades to Diego Garcia and to Bahrain36 (3) procurement by Arab states of 100 plus Euro Typhoon fighter aircraft to counter IRIN and IRGCN initiatives to gain maritime sea control in the Strait of Hormuz (4) the future deployment of additional supercarriers by the US Seventh Fleet in SE Asia37 (5) reactivation of Cam Ranh Bay naval base in Vietnam38 (6) construction of INS Kadamba in India39 (7) improved ship repair facilities at Changi naval base in Singapore40 (8) deployment of US marines to Darwin (9) redeployment of 80000 US troops to Guam and (10) supply of a new missile defence X-Brand radar system to Japan and possibly elsewhere in SE Asia41

34 Some academics assert the Russian SAM missiles have already been deployed For example in the article ldquoRussiarsquos S-300 Surface to Air Missiles already deployed and functional in Syriardquo by Professor Michel Chossudovsky Global research 30 May 2013 Refer to Web site globalresearchca This may not be strictly true for the designated missile variant However Moscow announced in June 2006 that it would deploy the older S-300PMU air defense to protect its maintenance naval base at Tartus in southern SyriaSee alsordquoIsrael could swoop on S-300 missiles in Syria but with more risksrdquo by Don Williams Reuters Jerusalem on Thursday 30 May 201335 ldquoSyria Policy Playbookrdquo contains enough material to write two entire books Deadline for additional submissions from Linkedin members has now been extended by The Intelligence Community to Tuesday 4 June 2013 Refer to wwwTheIntelligenceCommunitycom36 Bahrain is now called Naval Support Activity Bahrain (NSA Bahrain) It is home to US Naval forces Central Command and the US Fifth Fleet37 This intended deployment represents about 60 of total US naval assets Deployment will be in the Northern Indian Ocean Nan Hai Dong Hai Yellow Sea Sea of Japan and Western Pacific38 Redeveloped to permit entry and bunkering facilities for Western warships Dominates the Nan Hai and effectively replaces the abandoned US Subic Bay naval base in the Philippines39 New naval base on the Indian sub Continent south of Goa40 Changi naval base is now able to berth US Nimitz Class supercarriers In the future the base may be able to accommodate the new Ford Class supercarriers The ldquoGerald R Fordrdquo (CVN-78) is under construction and is due to be commissioned in 201541 To contain threats from North Korea and counter Chinarsquos growing missile capabilities the US has announced its intention to deploy a new missile defence shield in Japan and Asia The resulting radar arc would cover

P a g e | 18

The impending global deployment of X-Brand radar systems is treated in more detail later in this paper

US Navy Deployment

Just as in the Gulf Tanker War the US Navy has urgently deployed carrier battle groups to the Arabian Gulf and to the Gulf of Oman It was decided recently that the US Navy should always have at least two rotational carrier battle groups in the area

Given the drive by the US to become less reliant on imported oil its fiscal pressures on the military (defence budget sequestration) refits and the rising focus around the lsquoChina Seasrsquo (viz lsquoAsia-Pivotrsquo diplomacy) it may not be possible to ramp up US Navy assets in the Arabian Gulf and Indian Ocean Greater use of airborne surface and sub-surface RPVs would provide more flexible persistent and wider-area ISTAR capability to keep the lsquooil umbilicalrsquo under surveillance

With the current diplomatic impasse between Israel and Iran the stakes have risen Warships from 25 nations recently converged on the Strait of Hormuz as Israel and Iran moved towards the brink of war Ostensibly the deployment was for the largest war games ever held in the region Three US supercarrier battle groups took part in the war games comprising USS ldquoAbraham Lincolnrdquo (CVN-72) USS ldquoJohn C Stennisrdquo (CVN-74) and USS ldquoCarl Vinsonrdquo (CV-65) The three Nimitz Class supercarriers each have more than the entire complement of the Iranian airforce

Earlier in 2012 there were four US carrier groups in the region when the USS ldquoEnterpriserdquo (CV-65) visited the Arabian Gulf

The US Navyrsquos recently announced intention to deploy additional supercarriers in SE Asian and Western Pacific waters may yet prove to be nothing more than media rhetoric Severe ldquosequestrationrdquo cuts to the US defense budget proposed for January 2013 may obviate the intended deployment42 At the present time only two carriers are deployed namely the ldquoGeorge Washingtonrdquo (CVN-71) and ldquoJohn C Stennisrdquo (CVN-74) in the Western Pacific43

Official sources at the US DOD in Washington deny there will be any cut back in the future deployment of supercarriers to the Western Pacific But to the contrary Cesare Marchetti in his mathematical model suggests post-sequestration funding shortfalls will prevent the US from successfully ramping-up to support the next war funding effort possibly in 2027 or earlier44 It remains to be seen if the US Navy will be able to assume a dominant presence in the Western Pacific in future decades

This month the ldquoWashington Timesrdquo reported US Marines will serve long deployments for the next few years because of ongoing crises in the Middle East and

North Korea China Taiwan and possibly some ASEAN countries Michael Moore ldquoThe Telegraphrdquo 2012-11-02 and Shaun waterman ldquoWashington Timesrdquo 2012-9-17 42To quote lsquo the US DOD will cut more than $1 trillion out of the defense budget over the next decadersquo Carroll Chris ldquoStars and Stripesrdquo reporting for ldquoStripes Centralrdquo Washington 2012-11-0243 Stratfor Naval Update 2012-09-2644 Marchetti Cesare Victor Strategy Inc (Southern Pines NC) see his findings using a logisticdiffusion mathematical model posted in ldquoComposites World (CW) Industry News 2012-11-02 refer to wwwvector-strategycom

P a g e | 15

Syria has at least six main classes of ballistic missile for which there are an estimated eleven variants These include three variants of the Scud missile (1) Scud-B (Russia R17 ldquoElbrusrdquoNATO SS-1-C) from North Korea (2) Scud-C (SS-1-D) and (3) Scud-D (Russia R-17VTONATO SS-1-EDPRK Hwasong 7 The Scud-D has a guidance system and a range of 700 km Additionally Syria has two Chinese made road-mobile SRBMs the Dong Feng-15 and the Dong Feng-11 The DF-15 has a range of 600 to 800 km and is Syriarsquos most strategically important ballistic missile Other missiles in the arsenal include the Fateh-110 (Iran) SS-21 (North Korea) and a small number of Russian anti-ship cruise missiles (ASCM) designed for coastal defence All Syriarsquos ballistic missiles are capable of carrying chemical warheads

The precise attributes of these missile classes are beyond the scope of this paper

It is impossible to exactly calculate the classes variants and numbers of missiles possessed by Syria Unknown to the West the Assad regime may have concealed secret inventories hidden away in remote silos tunnels and caves

In addition to missile systems Syria is thought to have substantial inventories of 220mm and 302mm rocket systems Syria has supplied 25 per cent of its rocket arsenal to Hezbollah in southern Lebanon Hezbollah has now emerged as a non-state rocket superpower32

During the civil war at least twenty launches of ballistic missiles have been detected by NATO radar installations in nearby Turkey

Syria has one of the most active rocket and missile programs in the Middle East today The country is of real concern to Western military analysts Once the Assad regime is in its death throes it could act irrationally strike out at neighbouring oil refineries oil infrastructure pipelines oil tankers and the Suez Canal

Israel

In January 2013 Israeli Prime Minister Binyamin Netanyahu warned his governmentof the dangers of Syriarsquos growing missile inventories that Syria is rapidly fragmenting and its political system is falling apart In response in the same month the Israeli air force launched a pre-emptive air strike on a military site within Syria The target was a truck convey believed to contain a shipment of Russian-made SA-17 anti-aircraft missiles Collateral damage was also sustained to a military research centre located at Jamraya close to the Turkish border33 Iran has vowed revenge for this attack

For its part Israel may be forced to launch additional pre-emptive air strikes

Theoretical Outcomes

32 Eisenstadt Michael ldquoThe Middle East Missile Environmentrdquo Defense Dossier American Foreign policy Council (AFPC) Issue 6 January 2013 subscribed to and downloaded from AFPC33 Hubbard Ben ldquoIsraeli air strike inside Syria targets missilesrdquo World page 37 Australian Financial Review Friday 1 February 2013

P a g e | 16

The West has not been able to stop the carnage in Syria by means of a political economic or military solution

Theoretical outcomes from the civil war include (1) birth of a new pro-Iran Islamic state or (2) creation of a new politically weak state with no discernible allegiance to either East or West or (3) a new totalitarian state contrived by a strong IranianRussian comprehensive political economic and military takeover or (4) a Middle East State troops deployment within Syria to act as arbitrator (possibly from Saudi Arabia or Kuwait or UAE or a combination of Gulf Cooperative Council (GCC) States) for a onetwo year period or (5) coupled with the establishment of a ldquoNo Flyrdquo Zone deployment of UN peacekeeper troops to separate and quell the rebel fractions and possibly to support the Syrian Armed Forces or (6) legal censure of the war crimes committed by all fractions and commencement of due international legal process to charge arrest and intern offenders or (7) escalation of the civil war into a new conflict with Israel partly encircled as it is with SRBMMRBM based on the Gaza Strip in South Lebanon Syria and Iran or (8) further conflict with Turkey if more inaccurate Scud missiles launched in Syria stray over the border into refugee camps or Turkish villages Turkish troops could well take reprisals and (9) potential for a civil war to break out in Turkey destabilizing the current regime

Whatever the outcome the West believes the Assad regime will soon be toppled and the present incumbents charged with war crimes This could be regarded as a deus ex machina solution It is idealistic and it may never happen

All of the possible outcomes except for (4) above are disadvantageous to the West especially the potential for outbreaks of unwanted new regional wars Thus far it has not been possible to instigate a ldquoNo Flyrdquo Zone China and Russia have constantly vetoed this pro tem solution The crisis constitutes a ldquoflashpointrdquo which could embroil the entire Middle East and ultimately lead to WWIII Political dialoguenegotiations must and are continuing in an urgent attempt to solve the internal multi-faceted issues and to foster a moratorium to put a stop to the civil war

The West must do something Some military analysts suggest France Germany and the UK should go it alone invade Syria and put lsquoboots on the groundrsquo This hardline action would be disastrous and is evocative of the Suez crisis in 1956

A NATO or European Union lsquoboots on the groundrsquo option is a no-go for many reasons not the least the lessons learned from Iraq Afghanistan and Libya ndash no more lsquoinfidel invaderrsquo options The Syrian Crisis must be resolved by the countries in the region with lsquominimal crusaderrsquo support The West needs to find a lsquosmart powerrsquo solution without committing combat troops

In Washington DC the American Foreign Policy Council (AFPC) is working hard with members of US Congress the Executive Branch the US policymaking community other government agencies and Western governments to come up with a satisfactory answer to mitigate the Syrian crisis

Russia and the US between them might yet save the day with their proposed Peace Conference but this now seems unlikely The imminent deployment of Russian

P a g e | 17

surface to air (SAM) S-300 missiles to Syria has heightened tension34 Likewise the possibility that France and the UK will supply weapons to the Syrian opposition coalitionrebels may bring peace negotiations to an abrupt halt

Perhaps the West is powerless to solve the deepening crisis situation Is it game set and match to Syria Iran Russia and China

Substantial research on the Syrian Crisis is currently being prepared by The Intelligence Community LLC located in Washington DC35

Western Reaction

Just as before as in the late 1970rsquos the West has again reacted angrily to increasing militarism and political unrest alongside the main oil transit routes from the Arabian Gulf eastwards to India ASEAN China Taiwan Japan South Korea Australasia and other oil-consumer nations in the Western Pacific

New air-sea-battle lines are emerging to counter Iranrsquos continued intransigence in areas such as nuclear weapons proliferation Chinarsquos ldquoString of Pearlsrdquo lsquoanti-accessrsquo and lsquoarea-denialrsquo maritime stratagems

Counter measures include (1) the deployment of supercarriers by the US Fifth Fleet to the Middle East (2) upgrades to Diego Garcia and to Bahrain36 (3) procurement by Arab states of 100 plus Euro Typhoon fighter aircraft to counter IRIN and IRGCN initiatives to gain maritime sea control in the Strait of Hormuz (4) the future deployment of additional supercarriers by the US Seventh Fleet in SE Asia37 (5) reactivation of Cam Ranh Bay naval base in Vietnam38 (6) construction of INS Kadamba in India39 (7) improved ship repair facilities at Changi naval base in Singapore40 (8) deployment of US marines to Darwin (9) redeployment of 80000 US troops to Guam and (10) supply of a new missile defence X-Brand radar system to Japan and possibly elsewhere in SE Asia41

34 Some academics assert the Russian SAM missiles have already been deployed For example in the article ldquoRussiarsquos S-300 Surface to Air Missiles already deployed and functional in Syriardquo by Professor Michel Chossudovsky Global research 30 May 2013 Refer to Web site globalresearchca This may not be strictly true for the designated missile variant However Moscow announced in June 2006 that it would deploy the older S-300PMU air defense to protect its maintenance naval base at Tartus in southern SyriaSee alsordquoIsrael could swoop on S-300 missiles in Syria but with more risksrdquo by Don Williams Reuters Jerusalem on Thursday 30 May 201335 ldquoSyria Policy Playbookrdquo contains enough material to write two entire books Deadline for additional submissions from Linkedin members has now been extended by The Intelligence Community to Tuesday 4 June 2013 Refer to wwwTheIntelligenceCommunitycom36 Bahrain is now called Naval Support Activity Bahrain (NSA Bahrain) It is home to US Naval forces Central Command and the US Fifth Fleet37 This intended deployment represents about 60 of total US naval assets Deployment will be in the Northern Indian Ocean Nan Hai Dong Hai Yellow Sea Sea of Japan and Western Pacific38 Redeveloped to permit entry and bunkering facilities for Western warships Dominates the Nan Hai and effectively replaces the abandoned US Subic Bay naval base in the Philippines39 New naval base on the Indian sub Continent south of Goa40 Changi naval base is now able to berth US Nimitz Class supercarriers In the future the base may be able to accommodate the new Ford Class supercarriers The ldquoGerald R Fordrdquo (CVN-78) is under construction and is due to be commissioned in 201541 To contain threats from North Korea and counter Chinarsquos growing missile capabilities the US has announced its intention to deploy a new missile defence shield in Japan and Asia The resulting radar arc would cover

P a g e | 18

The impending global deployment of X-Brand radar systems is treated in more detail later in this paper

US Navy Deployment

Just as in the Gulf Tanker War the US Navy has urgently deployed carrier battle groups to the Arabian Gulf and to the Gulf of Oman It was decided recently that the US Navy should always have at least two rotational carrier battle groups in the area

Given the drive by the US to become less reliant on imported oil its fiscal pressures on the military (defence budget sequestration) refits and the rising focus around the lsquoChina Seasrsquo (viz lsquoAsia-Pivotrsquo diplomacy) it may not be possible to ramp up US Navy assets in the Arabian Gulf and Indian Ocean Greater use of airborne surface and sub-surface RPVs would provide more flexible persistent and wider-area ISTAR capability to keep the lsquooil umbilicalrsquo under surveillance

With the current diplomatic impasse between Israel and Iran the stakes have risen Warships from 25 nations recently converged on the Strait of Hormuz as Israel and Iran moved towards the brink of war Ostensibly the deployment was for the largest war games ever held in the region Three US supercarrier battle groups took part in the war games comprising USS ldquoAbraham Lincolnrdquo (CVN-72) USS ldquoJohn C Stennisrdquo (CVN-74) and USS ldquoCarl Vinsonrdquo (CV-65) The three Nimitz Class supercarriers each have more than the entire complement of the Iranian airforce

Earlier in 2012 there were four US carrier groups in the region when the USS ldquoEnterpriserdquo (CV-65) visited the Arabian Gulf

The US Navyrsquos recently announced intention to deploy additional supercarriers in SE Asian and Western Pacific waters may yet prove to be nothing more than media rhetoric Severe ldquosequestrationrdquo cuts to the US defense budget proposed for January 2013 may obviate the intended deployment42 At the present time only two carriers are deployed namely the ldquoGeorge Washingtonrdquo (CVN-71) and ldquoJohn C Stennisrdquo (CVN-74) in the Western Pacific43

Official sources at the US DOD in Washington deny there will be any cut back in the future deployment of supercarriers to the Western Pacific But to the contrary Cesare Marchetti in his mathematical model suggests post-sequestration funding shortfalls will prevent the US from successfully ramping-up to support the next war funding effort possibly in 2027 or earlier44 It remains to be seen if the US Navy will be able to assume a dominant presence in the Western Pacific in future decades

This month the ldquoWashington Timesrdquo reported US Marines will serve long deployments for the next few years because of ongoing crises in the Middle East and

North Korea China Taiwan and possibly some ASEAN countries Michael Moore ldquoThe Telegraphrdquo 2012-11-02 and Shaun waterman ldquoWashington Timesrdquo 2012-9-17 42To quote lsquo the US DOD will cut more than $1 trillion out of the defense budget over the next decadersquo Carroll Chris ldquoStars and Stripesrdquo reporting for ldquoStripes Centralrdquo Washington 2012-11-0243 Stratfor Naval Update 2012-09-2644 Marchetti Cesare Victor Strategy Inc (Southern Pines NC) see his findings using a logisticdiffusion mathematical model posted in ldquoComposites World (CW) Industry News 2012-11-02 refer to wwwvector-strategycom

P a g e | 16

The West has not been able to stop the carnage in Syria by means of a political economic or military solution

Theoretical outcomes from the civil war include (1) birth of a new pro-Iran Islamic state or (2) creation of a new politically weak state with no discernible allegiance to either East or West or (3) a new totalitarian state contrived by a strong IranianRussian comprehensive political economic and military takeover or (4) a Middle East State troops deployment within Syria to act as arbitrator (possibly from Saudi Arabia or Kuwait or UAE or a combination of Gulf Cooperative Council (GCC) States) for a onetwo year period or (5) coupled with the establishment of a ldquoNo Flyrdquo Zone deployment of UN peacekeeper troops to separate and quell the rebel fractions and possibly to support the Syrian Armed Forces or (6) legal censure of the war crimes committed by all fractions and commencement of due international legal process to charge arrest and intern offenders or (7) escalation of the civil war into a new conflict with Israel partly encircled as it is with SRBMMRBM based on the Gaza Strip in South Lebanon Syria and Iran or (8) further conflict with Turkey if more inaccurate Scud missiles launched in Syria stray over the border into refugee camps or Turkish villages Turkish troops could well take reprisals and (9) potential for a civil war to break out in Turkey destabilizing the current regime

Whatever the outcome the West believes the Assad regime will soon be toppled and the present incumbents charged with war crimes This could be regarded as a deus ex machina solution It is idealistic and it may never happen

All of the possible outcomes except for (4) above are disadvantageous to the West especially the potential for outbreaks of unwanted new regional wars Thus far it has not been possible to instigate a ldquoNo Flyrdquo Zone China and Russia have constantly vetoed this pro tem solution The crisis constitutes a ldquoflashpointrdquo which could embroil the entire Middle East and ultimately lead to WWIII Political dialoguenegotiations must and are continuing in an urgent attempt to solve the internal multi-faceted issues and to foster a moratorium to put a stop to the civil war

The West must do something Some military analysts suggest France Germany and the UK should go it alone invade Syria and put lsquoboots on the groundrsquo This hardline action would be disastrous and is evocative of the Suez crisis in 1956

A NATO or European Union lsquoboots on the groundrsquo option is a no-go for many reasons not the least the lessons learned from Iraq Afghanistan and Libya ndash no more lsquoinfidel invaderrsquo options The Syrian Crisis must be resolved by the countries in the region with lsquominimal crusaderrsquo support The West needs to find a lsquosmart powerrsquo solution without committing combat troops

In Washington DC the American Foreign Policy Council (AFPC) is working hard with members of US Congress the Executive Branch the US policymaking community other government agencies and Western governments to come up with a satisfactory answer to mitigate the Syrian crisis

Russia and the US between them might yet save the day with their proposed Peace Conference but this now seems unlikely The imminent deployment of Russian

P a g e | 17

surface to air (SAM) S-300 missiles to Syria has heightened tension34 Likewise the possibility that France and the UK will supply weapons to the Syrian opposition coalitionrebels may bring peace negotiations to an abrupt halt

Perhaps the West is powerless to solve the deepening crisis situation Is it game set and match to Syria Iran Russia and China

Substantial research on the Syrian Crisis is currently being prepared by The Intelligence Community LLC located in Washington DC35

Western Reaction

Just as before as in the late 1970rsquos the West has again reacted angrily to increasing militarism and political unrest alongside the main oil transit routes from the Arabian Gulf eastwards to India ASEAN China Taiwan Japan South Korea Australasia and other oil-consumer nations in the Western Pacific

New air-sea-battle lines are emerging to counter Iranrsquos continued intransigence in areas such as nuclear weapons proliferation Chinarsquos ldquoString of Pearlsrdquo lsquoanti-accessrsquo and lsquoarea-denialrsquo maritime stratagems

Counter measures include (1) the deployment of supercarriers by the US Fifth Fleet to the Middle East (2) upgrades to Diego Garcia and to Bahrain36 (3) procurement by Arab states of 100 plus Euro Typhoon fighter aircraft to counter IRIN and IRGCN initiatives to gain maritime sea control in the Strait of Hormuz (4) the future deployment of additional supercarriers by the US Seventh Fleet in SE Asia37 (5) reactivation of Cam Ranh Bay naval base in Vietnam38 (6) construction of INS Kadamba in India39 (7) improved ship repair facilities at Changi naval base in Singapore40 (8) deployment of US marines to Darwin (9) redeployment of 80000 US troops to Guam and (10) supply of a new missile defence X-Brand radar system to Japan and possibly elsewhere in SE Asia41

34 Some academics assert the Russian SAM missiles have already been deployed For example in the article ldquoRussiarsquos S-300 Surface to Air Missiles already deployed and functional in Syriardquo by Professor Michel Chossudovsky Global research 30 May 2013 Refer to Web site globalresearchca This may not be strictly true for the designated missile variant However Moscow announced in June 2006 that it would deploy the older S-300PMU air defense to protect its maintenance naval base at Tartus in southern SyriaSee alsordquoIsrael could swoop on S-300 missiles in Syria but with more risksrdquo by Don Williams Reuters Jerusalem on Thursday 30 May 201335 ldquoSyria Policy Playbookrdquo contains enough material to write two entire books Deadline for additional submissions from Linkedin members has now been extended by The Intelligence Community to Tuesday 4 June 2013 Refer to wwwTheIntelligenceCommunitycom36 Bahrain is now called Naval Support Activity Bahrain (NSA Bahrain) It is home to US Naval forces Central Command and the US Fifth Fleet37 This intended deployment represents about 60 of total US naval assets Deployment will be in the Northern Indian Ocean Nan Hai Dong Hai Yellow Sea Sea of Japan and Western Pacific38 Redeveloped to permit entry and bunkering facilities for Western warships Dominates the Nan Hai and effectively replaces the abandoned US Subic Bay naval base in the Philippines39 New naval base on the Indian sub Continent south of Goa40 Changi naval base is now able to berth US Nimitz Class supercarriers In the future the base may be able to accommodate the new Ford Class supercarriers The ldquoGerald R Fordrdquo (CVN-78) is under construction and is due to be commissioned in 201541 To contain threats from North Korea and counter Chinarsquos growing missile capabilities the US has announced its intention to deploy a new missile defence shield in Japan and Asia The resulting radar arc would cover

P a g e | 18

The impending global deployment of X-Brand radar systems is treated in more detail later in this paper

US Navy Deployment

Just as in the Gulf Tanker War the US Navy has urgently deployed carrier battle groups to the Arabian Gulf and to the Gulf of Oman It was decided recently that the US Navy should always have at least two rotational carrier battle groups in the area

Given the drive by the US to become less reliant on imported oil its fiscal pressures on the military (defence budget sequestration) refits and the rising focus around the lsquoChina Seasrsquo (viz lsquoAsia-Pivotrsquo diplomacy) it may not be possible to ramp up US Navy assets in the Arabian Gulf and Indian Ocean Greater use of airborne surface and sub-surface RPVs would provide more flexible persistent and wider-area ISTAR capability to keep the lsquooil umbilicalrsquo under surveillance

With the current diplomatic impasse between Israel and Iran the stakes have risen Warships from 25 nations recently converged on the Strait of Hormuz as Israel and Iran moved towards the brink of war Ostensibly the deployment was for the largest war games ever held in the region Three US supercarrier battle groups took part in the war games comprising USS ldquoAbraham Lincolnrdquo (CVN-72) USS ldquoJohn C Stennisrdquo (CVN-74) and USS ldquoCarl Vinsonrdquo (CV-65) The three Nimitz Class supercarriers each have more than the entire complement of the Iranian airforce

Earlier in 2012 there were four US carrier groups in the region when the USS ldquoEnterpriserdquo (CV-65) visited the Arabian Gulf

The US Navyrsquos recently announced intention to deploy additional supercarriers in SE Asian and Western Pacific waters may yet prove to be nothing more than media rhetoric Severe ldquosequestrationrdquo cuts to the US defense budget proposed for January 2013 may obviate the intended deployment42 At the present time only two carriers are deployed namely the ldquoGeorge Washingtonrdquo (CVN-71) and ldquoJohn C Stennisrdquo (CVN-74) in the Western Pacific43

Official sources at the US DOD in Washington deny there will be any cut back in the future deployment of supercarriers to the Western Pacific But to the contrary Cesare Marchetti in his mathematical model suggests post-sequestration funding shortfalls will prevent the US from successfully ramping-up to support the next war funding effort possibly in 2027 or earlier44 It remains to be seen if the US Navy will be able to assume a dominant presence in the Western Pacific in future decades

This month the ldquoWashington Timesrdquo reported US Marines will serve long deployments for the next few years because of ongoing crises in the Middle East and

North Korea China Taiwan and possibly some ASEAN countries Michael Moore ldquoThe Telegraphrdquo 2012-11-02 and Shaun waterman ldquoWashington Timesrdquo 2012-9-17 42To quote lsquo the US DOD will cut more than $1 trillion out of the defense budget over the next decadersquo Carroll Chris ldquoStars and Stripesrdquo reporting for ldquoStripes Centralrdquo Washington 2012-11-0243 Stratfor Naval Update 2012-09-2644 Marchetti Cesare Victor Strategy Inc (Southern Pines NC) see his findings using a logisticdiffusion mathematical model posted in ldquoComposites World (CW) Industry News 2012-11-02 refer to wwwvector-strategycom

P a g e | 17

surface to air (SAM) S-300 missiles to Syria has heightened tension34 Likewise the possibility that France and the UK will supply weapons to the Syrian opposition coalitionrebels may bring peace negotiations to an abrupt halt

Perhaps the West is powerless to solve the deepening crisis situation Is it game set and match to Syria Iran Russia and China

Substantial research on the Syrian Crisis is currently being prepared by The Intelligence Community LLC located in Washington DC35

Western Reaction

Just as before as in the late 1970rsquos the West has again reacted angrily to increasing militarism and political unrest alongside the main oil transit routes from the Arabian Gulf eastwards to India ASEAN China Taiwan Japan South Korea Australasia and other oil-consumer nations in the Western Pacific

New air-sea-battle lines are emerging to counter Iranrsquos continued intransigence in areas such as nuclear weapons proliferation Chinarsquos ldquoString of Pearlsrdquo lsquoanti-accessrsquo and lsquoarea-denialrsquo maritime stratagems

Counter measures include (1) the deployment of supercarriers by the US Fifth Fleet to the Middle East (2) upgrades to Diego Garcia and to Bahrain36 (3) procurement by Arab states of 100 plus Euro Typhoon fighter aircraft to counter IRIN and IRGCN initiatives to gain maritime sea control in the Strait of Hormuz (4) the future deployment of additional supercarriers by the US Seventh Fleet in SE Asia37 (5) reactivation of Cam Ranh Bay naval base in Vietnam38 (6) construction of INS Kadamba in India39 (7) improved ship repair facilities at Changi naval base in Singapore40 (8) deployment of US marines to Darwin (9) redeployment of 80000 US troops to Guam and (10) supply of a new missile defence X-Brand radar system to Japan and possibly elsewhere in SE Asia41

34 Some academics assert the Russian SAM missiles have already been deployed For example in the article ldquoRussiarsquos S-300 Surface to Air Missiles already deployed and functional in Syriardquo by Professor Michel Chossudovsky Global research 30 May 2013 Refer to Web site globalresearchca This may not be strictly true for the designated missile variant However Moscow announced in June 2006 that it would deploy the older S-300PMU air defense to protect its maintenance naval base at Tartus in southern SyriaSee alsordquoIsrael could swoop on S-300 missiles in Syria but with more risksrdquo by Don Williams Reuters Jerusalem on Thursday 30 May 201335 ldquoSyria Policy Playbookrdquo contains enough material to write two entire books Deadline for additional submissions from Linkedin members has now been extended by The Intelligence Community to Tuesday 4 June 2013 Refer to wwwTheIntelligenceCommunitycom36 Bahrain is now called Naval Support Activity Bahrain (NSA Bahrain) It is home to US Naval forces Central Command and the US Fifth Fleet37 This intended deployment represents about 60 of total US naval assets Deployment will be in the Northern Indian Ocean Nan Hai Dong Hai Yellow Sea Sea of Japan and Western Pacific38 Redeveloped to permit entry and bunkering facilities for Western warships Dominates the Nan Hai and effectively replaces the abandoned US Subic Bay naval base in the Philippines39 New naval base on the Indian sub Continent south of Goa40 Changi naval base is now able to berth US Nimitz Class supercarriers In the future the base may be able to accommodate the new Ford Class supercarriers The ldquoGerald R Fordrdquo (CVN-78) is under construction and is due to be commissioned in 201541 To contain threats from North Korea and counter Chinarsquos growing missile capabilities the US has announced its intention to deploy a new missile defence shield in Japan and Asia The resulting radar arc would cover

P a g e | 18

The impending global deployment of X-Brand radar systems is treated in more detail later in this paper

US Navy Deployment

Just as in the Gulf Tanker War the US Navy has urgently deployed carrier battle groups to the Arabian Gulf and to the Gulf of Oman It was decided recently that the US Navy should always have at least two rotational carrier battle groups in the area

Given the drive by the US to become less reliant on imported oil its fiscal pressures on the military (defence budget sequestration) refits and the rising focus around the lsquoChina Seasrsquo (viz lsquoAsia-Pivotrsquo diplomacy) it may not be possible to ramp up US Navy assets in the Arabian Gulf and Indian Ocean Greater use of airborne surface and sub-surface RPVs would provide more flexible persistent and wider-area ISTAR capability to keep the lsquooil umbilicalrsquo under surveillance

With the current diplomatic impasse between Israel and Iran the stakes have risen Warships from 25 nations recently converged on the Strait of Hormuz as Israel and Iran moved towards the brink of war Ostensibly the deployment was for the largest war games ever held in the region Three US supercarrier battle groups took part in the war games comprising USS ldquoAbraham Lincolnrdquo (CVN-72) USS ldquoJohn C Stennisrdquo (CVN-74) and USS ldquoCarl Vinsonrdquo (CV-65) The three Nimitz Class supercarriers each have more than the entire complement of the Iranian airforce

Earlier in 2012 there were four US carrier groups in the region when the USS ldquoEnterpriserdquo (CV-65) visited the Arabian Gulf

The US Navyrsquos recently announced intention to deploy additional supercarriers in SE Asian and Western Pacific waters may yet prove to be nothing more than media rhetoric Severe ldquosequestrationrdquo cuts to the US defense budget proposed for January 2013 may obviate the intended deployment42 At the present time only two carriers are deployed namely the ldquoGeorge Washingtonrdquo (CVN-71) and ldquoJohn C Stennisrdquo (CVN-74) in the Western Pacific43

Official sources at the US DOD in Washington deny there will be any cut back in the future deployment of supercarriers to the Western Pacific But to the contrary Cesare Marchetti in his mathematical model suggests post-sequestration funding shortfalls will prevent the US from successfully ramping-up to support the next war funding effort possibly in 2027 or earlier44 It remains to be seen if the US Navy will be able to assume a dominant presence in the Western Pacific in future decades

This month the ldquoWashington Timesrdquo reported US Marines will serve long deployments for the next few years because of ongoing crises in the Middle East and

North Korea China Taiwan and possibly some ASEAN countries Michael Moore ldquoThe Telegraphrdquo 2012-11-02 and Shaun waterman ldquoWashington Timesrdquo 2012-9-17 42To quote lsquo the US DOD will cut more than $1 trillion out of the defense budget over the next decadersquo Carroll Chris ldquoStars and Stripesrdquo reporting for ldquoStripes Centralrdquo Washington 2012-11-0243 Stratfor Naval Update 2012-09-2644 Marchetti Cesare Victor Strategy Inc (Southern Pines NC) see his findings using a logisticdiffusion mathematical model posted in ldquoComposites World (CW) Industry News 2012-11-02 refer to wwwvector-strategycom

P a g e | 18

The impending global deployment of X-Brand radar systems is treated in more detail later in this paper

US Navy Deployment

Just as in the Gulf Tanker War the US Navy has urgently deployed carrier battle groups to the Arabian Gulf and to the Gulf of Oman It was decided recently that the US Navy should always have at least two rotational carrier battle groups in the area

Given the drive by the US to become less reliant on imported oil its fiscal pressures on the military (defence budget sequestration) refits and the rising focus around the lsquoChina Seasrsquo (viz lsquoAsia-Pivotrsquo diplomacy) it may not be possible to ramp up US Navy assets in the Arabian Gulf and Indian Ocean Greater use of airborne surface and sub-surface RPVs would provide more flexible persistent and wider-area ISTAR capability to keep the lsquooil umbilicalrsquo under surveillance

With the current diplomatic impasse between Israel and Iran the stakes have risen Warships from 25 nations recently converged on the Strait of Hormuz as Israel and Iran moved towards the brink of war Ostensibly the deployment was for the largest war games ever held in the region Three US supercarrier battle groups took part in the war games comprising USS ldquoAbraham Lincolnrdquo (CVN-72) USS ldquoJohn C Stennisrdquo (CVN-74) and USS ldquoCarl Vinsonrdquo (CV-65) The three Nimitz Class supercarriers each have more than the entire complement of the Iranian airforce

Earlier in 2012 there were four US carrier groups in the region when the USS ldquoEnterpriserdquo (CV-65) visited the Arabian Gulf

The US Navyrsquos recently announced intention to deploy additional supercarriers in SE Asian and Western Pacific waters may yet prove to be nothing more than media rhetoric Severe ldquosequestrationrdquo cuts to the US defense budget proposed for January 2013 may obviate the intended deployment42 At the present time only two carriers are deployed namely the ldquoGeorge Washingtonrdquo (CVN-71) and ldquoJohn C Stennisrdquo (CVN-74) in the Western Pacific43

Official sources at the US DOD in Washington deny there will be any cut back in the future deployment of supercarriers to the Western Pacific But to the contrary Cesare Marchetti in his mathematical model suggests post-sequestration funding shortfalls will prevent the US from successfully ramping-up to support the next war funding effort possibly in 2027 or earlier44 It remains to be seen if the US Navy will be able to assume a dominant presence in the Western Pacific in future decades

This month the ldquoWashington Timesrdquo reported US Marines will serve long deployments for the next few years because of ongoing crises in the Middle East and

North Korea China Taiwan and possibly some ASEAN countries Michael Moore ldquoThe Telegraphrdquo 2012-11-02 and Shaun waterman ldquoWashington Timesrdquo 2012-9-17 42To quote lsquo the US DOD will cut more than $1 trillion out of the defense budget over the next decadersquo Carroll Chris ldquoStars and Stripesrdquo reporting for ldquoStripes Centralrdquo Washington 2012-11-0243 Stratfor Naval Update 2012-09-2644 Marchetti Cesare Victor Strategy Inc (Southern Pines NC) see his findings using a logisticdiffusion mathematical model posted in ldquoComposites World (CW) Industry News 2012-11-02 refer to wwwvector-strategycom

P a g e | 19

a shrinking number of US carriers available for deployment The USS ldquoEnterpriserdquo (CV-65) was deactivated last December and the USS ldquoAbraham Lincolnrdquo (CVN-72) is undergoing a four year overhaul to increase its life span This has reduced the US fleet of carriers from eleven to nine as the US Navy struggles to maintain a two carrier presence in the Middle East as required by the Obama administration since 201045

To further comment Diego Garcia and Guam are too far removed and provide insufficient defence assets to fully protect the global oil supply chain Nevertheless Diego Garcia has been upgraded to assume ldquofullest capability soonestrdquo and troops have been re-deployed to Guam (from Japan) and to Darwin (Australia) More importantly Cam Ranh Bay naval base in Vietnam is being modernised as a substitute for the previous loss of Subic Bay Singapore has lsquode factorsquo become the new ldquohubrdquo of the US Navyrsquos Seventh Fleet operational capability in SE Asia Manama (Bahrain) is now the home of the US Fifth Fleet The latterrsquos area of responsibility includes about 65 million sq kms of blue-water spanning the coastlines of 27 countries

Bahrain virtually at the lsquofountain headrsquo of the global oil supply has taken on a much more significant role On 27 May 2010 the Pentagon announced that NSA Bahrain is to receive US$580 million to double the size of the naval station The ASRY floating dock and other infrastructure is to be upgraded

If necessary the US could cut off crude oil supply from the Arabian Gulf littoral to its perceived adversaries (ie China and North Korea) This would be a drastic last resort step with dire consequences for world peace

US Missile Defence Agency (MDA)

The US is well aware of the increasing offensive rocket and ballistic missile threat to the oil supply chain stemming from Iran China North Korea and rogue States The very real threat pertains to the so-called ldquoaxis of resistancerdquo comprising Iran Syria and the non-states Hezbollah Hamas and Palestinian Islamic Jihad In March 2012 the Pentagon Missile Defense Agency announced a new watershed defense policy the US is seeking to build regional shields against ballistic missiles in both Asia and the Middle East

At present the US and its allies (except for Israel) lack the ability to counter the rocket threat as well as facing the danger of being numerically overwhelmed by the ballistic missile threat

Apart from a few defensive gaps Israel is better prepared than the US and its other regional allies Israel has fielded the lsquoIron Domersquo system to defend against shortmedium range rockets from Gaza and has used Patriot PAC-2GEM and Arrow IIIII interceptors to counter shortmedium range ballistic missiles from Syria and Iran However Israel does not have enough Iron Dome batteries to defend against high volume attacks of shortmedium range rockets The anticipated

45 Wong Kristina ldquoNavy to stretch deployments aircraft carrier fleet down to 9rdquo The Washington Times Thursday 10 January 2013

P a g e | 20

deployment of the Davidrsquos Sling interceptor in 2014 will enable Israel to deal with Hezbollahrsquos long range rockets46

The US has yet to allocate resources to develop improved counter rocket systems The existing Phalanx Counter Rocket Artillery and Mortar SystemC-RAM is largely ineffective

According to the MDA there are some seveneight main missile defence programs The Obama administration has expanded some and recast or cut others47 Technical details for each program can be accessed at the Arms Control Association48

The Pentagon has disclosed the US is seeking to build regional shields against ballistic missiles in both (1) Asia and (2) the Middle East The US has stated the systems are designed to protect against states like Iran and North Korea

For (1) the US has already deployed powerful early-warning X-Band radar in northern Japan and plans to install a second system on an unnamed southern Japanese island The system is described as a ldquolarge phased-array fire control sensor featuring precision discrimination and interceptor supportrdquo49 Regional powers particularly ASEAN countries Japan South Korea and Australasia would be protected In the longer term the reality is the Japan-based system is looking at the lsquoelephant in the roomrsquo which is China The missile defense requirements for Asia are comprehensively outlined by Klinger50

This paper separately examines operationalproposed missile defense systems for India Taiwan Japan and South Korea in some detail below

For (2) the US also intends to deploy two X-Band systems to the United Arab Emirates (UAE) and one to Qatar to deter any Iran missile attack Again the US intends to sell more than US$42 billion in missile defence systems to Kuwait including sixty Patriot Advanced Capability missiles twenty launching platforms and four X-Band radars

Saudi Arabia has bought a large arsenal of Patriot systems the latest being US$17 billion in upgrades in 2011

The US is also set to supply two missile defence launchers for a THAAD system to be located in the United Arab Emirates

46 Ibid Eisenstadt ldquoThe Middle East Environmentrdquo Defense Dossier AFPC47 The eight main US missile defence programs are (1) Ground-Based Midcourse ldquokinetic killrdquo EKVCE-II (2) Aegis ship-based Ballistic Missile Defense (BMD) (3) Theatre High-Altitude Area Defense (THAAD) (4) Patriot Advanced Capability-3 (PAC-3) (5) Space Tracking and Surveillance System (STSS) (6) Space-Based Infrared System-high (SBIRS-high) (7) Airborne Laser (ABL) and (8) Kinetic Energy Interceptor (KEI) ndash now temporarily scrapped48 Refer to wwwarmscontrolorg 49 As described by its manufacturer Raytheon Company50 Klinger Bruce ldquoMissile Defense Requirements of the Asia Pivotrdquo Defense Dossier American Foreign Policy Council (AFPC) Issue 6 January 2013 subscribed todownloadedretrieved from the Internet

P a g e | 20

deployment of the Davidrsquos Sling interceptor in 2014 will enable Israel to deal with Hezbollahrsquos long range rockets46

The US has yet to allocate resources to develop improved counter rocket systems The existing Phalanx Counter Rocket Artillery and Mortar SystemC-RAM is largely ineffective

According to the MDA there are some seveneight main missile defence programs The Obama administration has expanded some and recast or cut others47 Technical details for each program can be accessed at the Arms Control Association48

The Pentagon has disclosed the US is seeking to build regional shields against ballistic missiles in both (1) Asia and (2) the Middle East The US has stated the systems are designed to protect against states like Iran and North Korea

For (1) the US has already deployed powerful early-warning X-Band radar in northern Japan and plans to install a second system on an unnamed southern Japanese island The system is described as a ldquolarge phased-array fire control sensor featuring precision discrimination and interceptor supportrdquo49 Regional powers particularly ASEAN countries Japan South Korea and Australasia would be protected In the longer term the reality is the Japan-based system is looking at the lsquoelephant in the roomrsquo which is China The missile defense requirements for Asia are comprehensively outlined by Klinger50

This paper separately examines operationalproposed missile defense systems for India Taiwan Japan and South Korea in some detail below

For (2) the US also intends to deploy two X-Band systems to the United Arab Emirates (UAE) and one to Qatar to deter any Iran missile attack Again the US intends to sell more than US$42 billion in missile defence systems to Kuwait including sixty Patriot Advanced Capability missiles twenty launching platforms and four X-Band radars

Saudi Arabia has bought a large arsenal of Patriot systems the latest being US$17 billion in upgrades in 2011

The US is also set to supply two missile defence launchers for a THAAD system to be located in the United Arab Emirates

46 Ibid Eisenstadt ldquoThe Middle East Environmentrdquo Defense Dossier AFPC47 The eight main US missile defence programs are (1) Ground-Based Midcourse ldquokinetic killrdquo EKVCE-II (2) Aegis ship-based Ballistic Missile Defense (BMD) (3) Theatre High-Altitude Area Defense (THAAD) (4) Patriot Advanced Capability-3 (PAC-3) (5) Space Tracking and Surveillance System (STSS) (6) Space-Based Infrared System-high (SBIRS-high) (7) Airborne Laser (ABL) and (8) Kinetic Energy Interceptor (KEI) ndash now temporarily scrapped48 Refer to wwwarmscontrolorg 49 As described by its manufacturer Raytheon Company50 Klinger Bruce ldquoMissile Defense Requirements of the Asia Pivotrdquo Defense Dossier American Foreign Policy Council (AFPC) Issue 6 January 2013 subscribed todownloadedretrieved from the Internet

P a g e | 21

US Navy warships on continuous deployment in the Arabian Gulf are equipped with Aegis missile defense systems including advanced tracking radars and interceptor missiles

It is ascertained there may be some partial protection for incoming enemy ICBMs targeted at the Gulf littoral states once advanced capability missile shields are operational

These advanced systems do not guarantee 100 effectiveness especially as Iran is increasing both the type and number of missiles fielded in the region The Iranian Republican Guard has allegedly pointed 1000 missiles at US bases in the Middle East ldquoThere will be war and we will winrdquo says the Republican Guard There are some historic rivalries and political constraints preventing the US from applying a homogenous approach to a comprehensive ldquoumbrellardquo defense solution for the Arabian Gulf littoral states

Indian Navy

India has taken a positive stand in protecting its maritime interests The new naval base of INS Kadamba (near Goa) in southern India is rapidly expanding together with enhancements to the existing Indian naval bases ADM Sureesh Mehta Indiarsquos Navy Chief has asserted ldquo each pearl in the (PLAN) string is a link in a chain of the Chinese maritime presencerdquo

The Indian Navyrsquos expansion and increased lsquoBlue Waterrsquo capability is a significant player in lsquokeeping the oil umbilicalrsquo game As Indiarsquos economic powers and aspirations increase it will require more energy and oil However the West also needs to understand its naval crew capability There are often sidewards glances to Pakistan and other neighbours Pakistanrsquos close links to China will be especially important to watch as it plays lsquocatch up with the Jonesrsquosrsquo with Chinarsquos support

If PLAN sources perceive Indian intentions to be aimed at containing China they also see India rapidly building the capabilities necessary to do so Modern Navy has covered Indiarsquos naval build-up fairly extensively In April 2003 it ran an article titled ldquoWill the South China Sea Become the lsquoSecond Persian Gulfrsquordquo that laid out Indiarsquos 2003 plan to spend $62 billion over the next 22 years to modernize the navy and also detailed Indiarsquos growing interactions with ASEAN

In a December 2005 article National Defense asserted that India seeks to have a top four navy by 201051 An October 2005 article in the PLA Daily described the efforts India is making as part of its new strategy to ldquodestroy the enemy in distant seasrdquo (远海歼敌 ) As part of this effort India spent $35 billion buying submarines from France and plans under ldquoProject 75rdquo to build 20 nuclear attack submarines equipped with long distance cruise missiles over the next 30 years In addition India

51 Gao Xinsheng ldquoZhongguo haifang fazhan mianlin de zhuyao tiaozhan yu duicerdquo [The Main Challengesand Answers to the Development of Chinarsquos Maritime Defense and Policy Countermeasures] Guofangno 11 (2005) The author is from the Shenyang Artillery Academy Basic Maritime Defense TacticsTeaching and Research Office (沈阳炮兵学院基础部海防战术教研室)

P a g e | 22

is building aircraft carriers with the first locally constructed aircraft carrier expected to be operational in 201252

Indeed the PLA Daily also reported that India wants to develop an aircraft carrier fleet on a par with Englandrsquos - this new fleet will allow it to move into the Pacific 53

Indian Missile Developments

India is surprisingly advanced in developing missile defence shield systems Phase 1 of the planned development to initially protect two major cities New Delhi and Mumbai has been largely completed according to the Indian Defence Research and Development Organisation (DRDO) located at Bhawan near New Delhi The system will eventually be extended to cover other major cities in India The Phase 1 development is comparable to the US Patriot PAC-3 system

The new two-tiered BMD system will require minimum human intervention due to the complex automation of tracking devices and counter-measures Human intervention will be required only to abort the mission To ensure maximum protection against air-borne threats DRDO intends to put together a mix of counter-attack missiles which will be able to shoot down enemy missiles both within earthrsquos atmosphere (endo-atmospheric) and outside it (exo-atmospheric) The shield has undergone a series of successful tests It can destroy an incoming ballistic missile with a range of up to 2000 km

The BMD system comprises two components (1) Prithvi Air Defence (PAD) or Pradyumna Ballistic Missile Interceptor and (2) Advanced Air Defence (AAD) or Ashwin Ballistic Missile Interceptor

PAD is an anti-ballistic missile developed to intercept incoming ballistic missiles outside of the atmosphere (exo-atmospheric) Based on the Prithvi missile PAD is a two stage missile with a maximum interception altitude of 50 to 80 km PAD has capability to engage 300 to 2000 km class of ballistic missiles at a speed of Mach 5 LRTR is the target acquisition and fire control radar for the PAD missile It is an lsquoactive phased-array radarrsquo able to track 200 targets at a range of 600 km

AAD is an anti-ballistic missile designed to intercept incoming ballistic missiles in the endo-atmosphere at an altitude of 30 km AAD is a single stage missile Guidance is similar to that of PAD it has an inertial navigation system midcourse updates from ground based radar and interactive homing in the terminal phase

Successful testings have been conducted by launching modified Prithvi missiles from Launch Complex III at Chandipur Orissa Radars located at Konark and at Paradip (these townships are 112 kms apart) detected the missile and continuously tracked it Target information was conveyed to an AAD battery located on Wheeler Island some 70 km across the sea from Chandipur The AAD was launched when the

52 Jiefangjun Bao ldquoYindu tuijin yuanhai jianmie de xin zhanluerdquo [India Pushes a New Strategy ofDestroying the Enemy in Distant Seas] November 9 2005 12

53 Jiefangjun Bao ldquoHangmu youyixia de Yatai zhanlue qijurdquo [Asiarsquos Strategic Chessboard of AircraftCarriers] July 20 2005 9

P a g e | 23

Prithvi reached an apogee of 110 km The AAD made a direct hit at an altitude of 15 km and at a speed of Mach 454

ldquoSwordfishrdquo long range tracking radar (LRTR) is the target acquisition and fire control radar for the BMD system The LRTR has a range of 600 to 1500 km and can spot objects as small as a cricket ball

Phase 2 of the BMD system is to develop two new anti-ballistic missiles namely AD-1 and AD-2 These missiles are able to intercept IRBMs The two new missiles have a range of 5000 km and are similar to the US THAAD system India is also developing a new advanced missile codenamed PDV designed to be operational by 2013 Phase 2 is to be completed by 2016

Currently India has little or no protection from incoming ICBMs The US and India are likely to cooperate to fully develop the BMD shield system according to a senior US diplomat when visiting India in July 2012

Some early doubts have been expressed within India as to the viability of the BMD system55 These are likely to be discounted in the light of recent progress and a future US-India strategic partnership

Currently India is also moving ahead with plans to test a new submarine-launched ballistic missile Once operational the K-15 ndash which has a range of 435 miles ndash will be capable of being outfitted with either a conventional payload or a tactical nuclear warhead56

Both Pakistan and China are angered by Indiarsquos forthcoming success China is developing its own missile defence system to counter the missile arsenals of India and others China is likely to assist Pakistan one of its closest allies in Asia by helping Islamabad match Indiarsquos BMD capability Pakistan is reported to be developing manoeuvrable re-entry vehicles to maintain a credible strategic deterrent in the face of Indian countermeasures

India is ranked fourth in the world by its oil imports Consumption is in excess of 31 MMbblday

Taiwan (Republic of China)

Taiwanrsquos military is developing an offensive surface-to-surface (MRBM) missile with a 1200 km range Codenamed ldquoCloud Peakrdquo (Yunfeng) the missile is outfitted with a ramjet engine capable of Mach 3 speed Production of the missile is to begin in 2014 Taiwan has also deployed other offensive missiles on the island such as the Hsiung Feng (Brave Wind) 2E land attack cruise missile (LACM) and other variants of the Hsiung Feng missile family The Taiwanese Ministry of National Defense (MND) has expanded its defense budget to modernize its SAM missile inventories to procure rocket boosters for the AIM-120 air-to-air missile to obtain new rocket motors to equip its Standard Missile 1 to conduct efficiency tests for is aging MIM23

54 Wikipedia ldquoIndian Ballistic Missile Defence Programmerdquo see page 3 (of 8 pages) retrieved from httpewikipediaorgwikiIndian_Ballistic_Missile_Defence_Programme 15 January 201355 Debak Das ldquoIndia How Credible is its Ballistic Missile Defencerdquo research intern NSP IPCS 29 November 2012 email debakdgmailcom 56 ldquoGlobal Securityrdquo Newswire 18 December 2012

P a g e | 22

is building aircraft carriers with the first locally constructed aircraft carrier expected to be operational in 201252

Indeed the PLA Daily also reported that India wants to develop an aircraft carrier fleet on a par with Englandrsquos - this new fleet will allow it to move into the Pacific 53

Indian Missile Developments

India is surprisingly advanced in developing missile defence shield systems Phase 1 of the planned development to initially protect two major cities New Delhi and Mumbai has been largely completed according to the Indian Defence Research and Development Organisation (DRDO) located at Bhawan near New Delhi The system will eventually be extended to cover other major cities in India The Phase 1 development is comparable to the US Patriot PAC-3 system

The new two-tiered BMD system will require minimum human intervention due to the complex automation of tracking devices and counter-measures Human intervention will be required only to abort the mission To ensure maximum protection against air-borne threats DRDO intends to put together a mix of counter-attack missiles which will be able to shoot down enemy missiles both within earthrsquos atmosphere (endo-atmospheric) and outside it (exo-atmospheric) The shield has undergone a series of successful tests It can destroy an incoming ballistic missile with a range of up to 2000 km

The BMD system comprises two components (1) Prithvi Air Defence (PAD) or Pradyumna Ballistic Missile Interceptor and (2) Advanced Air Defence (AAD) or Ashwin Ballistic Missile Interceptor

PAD is an anti-ballistic missile developed to intercept incoming ballistic missiles outside of the atmosphere (exo-atmospheric) Based on the Prithvi missile PAD is a two stage missile with a maximum interception altitude of 50 to 80 km PAD has capability to engage 300 to 2000 km class of ballistic missiles at a speed of Mach 5 LRTR is the target acquisition and fire control radar for the PAD missile It is an lsquoactive phased-array radarrsquo able to track 200 targets at a range of 600 km

AAD is an anti-ballistic missile designed to intercept incoming ballistic missiles in the endo-atmosphere at an altitude of 30 km AAD is a single stage missile Guidance is similar to that of PAD it has an inertial navigation system midcourse updates from ground based radar and interactive homing in the terminal phase

Successful testings have been conducted by launching modified Prithvi missiles from Launch Complex III at Chandipur Orissa Radars located at Konark and at Paradip (these townships are 112 kms apart) detected the missile and continuously tracked it Target information was conveyed to an AAD battery located on Wheeler Island some 70 km across the sea from Chandipur The AAD was launched when the

52 Jiefangjun Bao ldquoYindu tuijin yuanhai jianmie de xin zhanluerdquo [India Pushes a New Strategy ofDestroying the Enemy in Distant Seas] November 9 2005 12

53 Jiefangjun Bao ldquoHangmu youyixia de Yatai zhanlue qijurdquo [Asiarsquos Strategic Chessboard of AircraftCarriers] July 20 2005 9

P a g e | 23

Prithvi reached an apogee of 110 km The AAD made a direct hit at an altitude of 15 km and at a speed of Mach 454

ldquoSwordfishrdquo long range tracking radar (LRTR) is the target acquisition and fire control radar for the BMD system The LRTR has a range of 600 to 1500 km and can spot objects as small as a cricket ball

Phase 2 of the BMD system is to develop two new anti-ballistic missiles namely AD-1 and AD-2 These missiles are able to intercept IRBMs The two new missiles have a range of 5000 km and are similar to the US THAAD system India is also developing a new advanced missile codenamed PDV designed to be operational by 2013 Phase 2 is to be completed by 2016

Currently India has little or no protection from incoming ICBMs The US and India are likely to cooperate to fully develop the BMD shield system according to a senior US diplomat when visiting India in July 2012

Some early doubts have been expressed within India as to the viability of the BMD system55 These are likely to be discounted in the light of recent progress and a future US-India strategic partnership

Currently India is also moving ahead with plans to test a new submarine-launched ballistic missile Once operational the K-15 ndash which has a range of 435 miles ndash will be capable of being outfitted with either a conventional payload or a tactical nuclear warhead56

Both Pakistan and China are angered by Indiarsquos forthcoming success China is developing its own missile defence system to counter the missile arsenals of India and others China is likely to assist Pakistan one of its closest allies in Asia by helping Islamabad match Indiarsquos BMD capability Pakistan is reported to be developing manoeuvrable re-entry vehicles to maintain a credible strategic deterrent in the face of Indian countermeasures

India is ranked fourth in the world by its oil imports Consumption is in excess of 31 MMbblday

Taiwan (Republic of China)

Taiwanrsquos military is developing an offensive surface-to-surface (MRBM) missile with a 1200 km range Codenamed ldquoCloud Peakrdquo (Yunfeng) the missile is outfitted with a ramjet engine capable of Mach 3 speed Production of the missile is to begin in 2014 Taiwan has also deployed other offensive missiles on the island such as the Hsiung Feng (Brave Wind) 2E land attack cruise missile (LACM) and other variants of the Hsiung Feng missile family The Taiwanese Ministry of National Defense (MND) has expanded its defense budget to modernize its SAM missile inventories to procure rocket boosters for the AIM-120 air-to-air missile to obtain new rocket motors to equip its Standard Missile 1 to conduct efficiency tests for is aging MIM23

54 Wikipedia ldquoIndian Ballistic Missile Defence Programmerdquo see page 3 (of 8 pages) retrieved from httpewikipediaorgwikiIndian_Ballistic_Missile_Defence_Programme 15 January 201355 Debak Das ldquoIndia How Credible is its Ballistic Missile Defencerdquo research intern NSP IPCS 29 November 2012 email debakdgmailcom 56 ldquoGlobal Securityrdquo Newswire 18 December 2012

P a g e | 23

Prithvi reached an apogee of 110 km The AAD made a direct hit at an altitude of 15 km and at a speed of Mach 454

ldquoSwordfishrdquo long range tracking radar (LRTR) is the target acquisition and fire control radar for the BMD system The LRTR has a range of 600 to 1500 km and can spot objects as small as a cricket ball

Phase 2 of the BMD system is to develop two new anti-ballistic missiles namely AD-1 and AD-2 These missiles are able to intercept IRBMs The two new missiles have a range of 5000 km and are similar to the US THAAD system India is also developing a new advanced missile codenamed PDV designed to be operational by 2013 Phase 2 is to be completed by 2016

Currently India has little or no protection from incoming ICBMs The US and India are likely to cooperate to fully develop the BMD shield system according to a senior US diplomat when visiting India in July 2012

Some early doubts have been expressed within India as to the viability of the BMD system55 These are likely to be discounted in the light of recent progress and a future US-India strategic partnership

Currently India is also moving ahead with plans to test a new submarine-launched ballistic missile Once operational the K-15 ndash which has a range of 435 miles ndash will be capable of being outfitted with either a conventional payload or a tactical nuclear warhead56

Both Pakistan and China are angered by Indiarsquos forthcoming success China is developing its own missile defence system to counter the missile arsenals of India and others China is likely to assist Pakistan one of its closest allies in Asia by helping Islamabad match Indiarsquos BMD capability Pakistan is reported to be developing manoeuvrable re-entry vehicles to maintain a credible strategic deterrent in the face of Indian countermeasures

India is ranked fourth in the world by its oil imports Consumption is in excess of 31 MMbblday

Taiwan (Republic of China)

Taiwanrsquos military is developing an offensive surface-to-surface (MRBM) missile with a 1200 km range Codenamed ldquoCloud Peakrdquo (Yunfeng) the missile is outfitted with a ramjet engine capable of Mach 3 speed Production of the missile is to begin in 2014 Taiwan has also deployed other offensive missiles on the island such as the Hsiung Feng (Brave Wind) 2E land attack cruise missile (LACM) and other variants of the Hsiung Feng missile family The Taiwanese Ministry of National Defense (MND) has expanded its defense budget to modernize its SAM missile inventories to procure rocket boosters for the AIM-120 air-to-air missile to obtain new rocket motors to equip its Standard Missile 1 to conduct efficiency tests for is aging MIM23

54 Wikipedia ldquoIndian Ballistic Missile Defence Programmerdquo see page 3 (of 8 pages) retrieved from httpewikipediaorgwikiIndian_Ballistic_Missile_Defence_Programme 15 January 201355 Debak Das ldquoIndia How Credible is its Ballistic Missile Defencerdquo research intern NSP IPCS 29 November 2012 email debakdgmailcom 56 ldquoGlobal Securityrdquo Newswire 18 December 2012

P a g e | 24

Hawk SAM missiles and plans to acquire AGM-65G Maverick AGM-84L Harpoon and Magic II missiles The MND will also increase production of the domestically produced Tien Chien II missiles

Taiwan will be partially covered by a US anti-missile shield resulting from current and proposed deployments of X-Band radar in Japan and elsewhere in SE Asia57 To quote from the Wall Street Journal (WSJ) ldquordquo If yoursquore putting one in southern Japan and one in the Philippines yoursquore sort of bracketing Taiwan ldquo Mr Lewis said ldquoSo it does look like yoursquore making sure that you can put a missile defence cap over the Taiwaneserdquordquo (WSJ ldquoUS Plans to foster missile defence in Asiardquo 23 August 2012)

In addition Taiwan is building a missile defence shield in direct response to Chinese missiles pointed in its direction It is estimated up to 1500 Chinese shortmedian- range missiles (some equipped with advanced GPS systems) plus another 500 cruise missiles (CM) are now aimed at Taiwan58 The Taiwanese shield comprises six Patriot III missile batteries and an early warning radar based on the indigenously developed Tien Kung II (Sky Bow) SAM system and Patriot III (PAC-3) missiles Specifically the early warning radar component is the new Raytheon long-range early warning and surveillance UHF radar system

In taking delivery of the new Raytheon early warning radar system which provides 360 degrees coverage and a 3000 nautical mile reconnaissance capability Taiwan is able to detect North Korean and Chinese missile launches The system was installed in late December 2012 at Loshan air force base in Hsinchu County The radar can collect information of offensive military activity in some areas in Northeast Asia and Southeast Asia including in the disputed Diaoyutai Islands (Dong Hai) and the Taiping Island in the Spratly Island Group (Nan Hai) The new radar system can give Taiwan six minutes warning of a hostile missile launch

The US Seventh Fleet when deployed near Taiwan is able to provide supplementary cover from SM-3 missiles installed on vessels equipped with the Aegis system

Beyond this intermediate cover Taiwan urgently needs Terminal High Altitude Air Defense (THAAD) units 59 The US Government may not supply Taiwan with THAAD units as this would greatly anger the Chinese and North Korean Governments For similar reasons Taiwan is not likely to acquire the new X-Brand radar system either now or in the foreseeable future

Lockheed Martin was awarded a contract in January 2013 to product 168 Patriot Advanced Capability (PAC-3) missiles for the US Government and Taiwan The new contract is worth US$755 million Taiwan is the fifth international customer for the PAC-3 60

57 Thim Michael ldquoTaiwan in the Context of US Missile Defense Infrastructure in Asiardquo Wordpress 24 August 2013 retrieved from httpmichalthimwordpresscom20120824taiwan-in-the-context-of-us-missile-defence 13 February 201358 Taiwan is the principal receiver of missile threat from China refer to ldquoReport on Chinese Military Powerrdquo prepared annually by the US Department of Defense (DOD)59 ldquoTaiwan Builds Missile Defence Shield in face of Chinese Missile Build Uprdquo Defence Tech retrieved 6 August 201260 ldquoTaiwan Missile Threatrdquo a project of the George C Marshall and Claremont Institutes 11 January 2013

P a g e | 25

Yin Zhou a Beijing based military expert has stated ldquothe US will not spend so much energy on Taiwan to implement ballistic missiles interceptor missiles and GPS radars everywhere Just a GPS radar costs more than US$1 billion And to lsquoprotectrsquo Taiwan is just a move for the US to deal with China not an ultimate goalrdquo 61

MAJGEN Xu Guangyu senior researcher at the China Arms Control and Disarmament Association (Beijing) recently suggested that both sides urgently needed to put aside their political disagreements and work together to tackle the territorial problem amid an escalation of tensions with Japan62

Useful background reading in reference to the Taiwan flashpoint is to be found in a 17-page research paper produced by Mumin Chen at the University of Denver63

Taiwan is ranked fifteenth in the world by its oil imports Its consumption is approximately 088 MMbblday

Japan

The Japan Maritime Self-Defence Force (JMSDF) is primarily tasked with the defense of Japan The JMSD has a large fleet with significant blue-water operating capabilities Whilst based strictly on defensive armament main tasks to be undertaken by the force are to maintain control of sea lines of communication (SLOCs) and to patrol territorial waters Oil tanker and mercantile shipments to Japan will thus be protected

The JMSD operates some 150 major warships These include four helicopter destroyers (DDH ldquohelicopter carriersrdquo) comprising Shirane and Hyuga Classes eight guided-missile destroyers (DDG Hatakaze Kongo and Atago Classes) 33 destroyers (DD Hatsuyuki Asagiri Murasame Takanami and Akizuki Classes) 6 destroyer escorts or frigates (DE Abukuma Class) and many other supportive vessels in JMSD fleet Some of the DDG are equipped with Aegis combat capability64

Current JMSDF strength and capabilities have been designed to support US Navy operations in the East Asia region Defense analysts believe the JMSD in terms of its capability to conduct non-nuclear operations is possibly second only to the US Indeed some assert the size and non-strike defensive operations capabilities are almost two times as large as that of the US Seventh Fleet The JMSD and US Seventh Fleet combine effectively together as a formidable force to neutralise PLAN maritime strategies

61 Xiaokun Li in Beijing and Yingzi Tan in Washington ldquoUS insists missile defense targets DPRK not Chinardquo China Daily updated 2012-08-25 at 002962 Chan Minnie ldquoTaiwanrsquos Ma Ying-Jeou urged to pursue higher level military exchangesrdquo South China Morning Post source URL retrieved 12 February 2013 refer to Web site httpwwwscmpcomnewschinaarticle1139693taiwans-ma-ying-jeou-urged-pursue-higher-level-military-exchanges 63 Chen Mumin ldquoTheatre Missile Defense and Cross-Strait Relationsrdquo Graduate School of International Studies University of Denver email address muchenduedu 64 See ldquoList of Active Japanese Navy Ships 2012rdquo You Tube video 17 March 2012 downloaded and retrieved from wwwyoutubecomwatchv=cHTu9g54WMA 17 February 2013

P a g e | 26

James Hardy has recently appraised the evolving power of the Japanese Navy65

Klinger states ldquoTokyo has long pursued a minimalist security policy Even when faced with growing regional security threats Japan has reduced its overall defense budget for ten consecutive years Despite this Japan has significantly augmented its missile defence program spurred by concerns over North Korearsquos growing missile and nuclear capabilitiesrdquo66

Again Klinger explains ldquoJapan has developed and deployed a layered integrated missile defense system consisting of Kongo Class Aegis destroyers with Standard Missile-3 (SM-3) interceptors for high altitude missile defense and land based Patriot Advance Capability-3 (PAC-3) units for terminal phase interceptionrdquo67

ldquoFor the future Japan announced it will equip two Atago Class destroyers with Aegis systems expand PAC-3 deployment from three anti-aircraft groups to six anti-aircraft groups and develop an additional fire unit of PAC-3rdquo68

In 2012 land-based PAC-3 missile batteries were deployed to Okinawa Miyako and Ishigaki Islands bordering the Dong Hai in the south east

Additional missile inventories held by Japan include AAM variants (Types 04 69 90 99) ASM (Types 80 91 93) ATMrsquos (six variants) SAM approximately nine variants) SSM (three variants) and SM-3 Block-IIIIA (joint development with the US)69

The US has deployed two forward-based (FBM) ANTPY2 X-Band early warning radar systems in Japan These are located at Shariki base in Tsugaru City on the coast of Aomori prefecture in northern Japan (Honshu Island) and at an undisclosed location in southern Japan These systems constitute a vital component of the anti-missile shield system and are integrated with localised Joint Tactical Ground Stations (JTAG) The northern based JTAG is located at the remote Misawa Air Base in Japan one of only four in the world It is thought the US operates three other JTAGs in Germany Qatar and South Korea BRIGEN John Seward a former deputy commanding general of operations for the US Army Space and Missile Defense Command stated in January 2008 ldquoJapan is one of our strongest allies in the ballistic missile defense arenardquo70

Some defense analysts assert the US may deploy another X-Band radar system in the Philippines but this is not confirmed

Steve Hildreth a missile defence expert with the Congressional Research Service an advisory arm of Congress has stated ldquothe US was laying the foundations for a

65 Hardy James ldquoJapanrsquos Navy Sailing Towards the Futurerdquo The Diplomat 21 January 2013 refer to httpthediplomatcom20130121japans-navy-steaming-towards-the-future 66 Ibid Klinger page 1867 Ibid68 Ibid69 Wikipedia ldquoList of Missiles by Countryrdquo downloaded and extrapolated from httpenwikipediaorgwikiList_of_missiles_by_country 70 Associated Press ldquoJapan US rush to build anti-missile shieldrdquo updated 28 January 2008 retrieved from wwwnbcnewscomid22886176 on 18 February 2013 Statement made by Brigadier General John E Seward

P a g e | 27

region wide missile defense system that would combine US ballistic missile defences with those of regional powers particularly Japan South Korea and Australiardquo71

It is not known if the US intends to deploy a Terminal High-Altitude Area Defense (THAAD) anti-missile battery in Japan However the ANTPY2 X-Band early warning radar system is designed to interface with THAAD batteries just as easily as with other components of the missile shield system THAAD includes its own radar along with interceptors communications and fire control units72 (Two THAAD systems have been ordered by the United Arab Emirates (UAE))

The northern and western Pacific is also defended by a Raytheon sea-based X-Band (SBX) radar system This system is a floating self-propelled mobile radar station designed to operate in high winds and heavy seas73 This state-of-the-art radar station costing US$1 billion can be deployed anywhere in the northern Pacific Ocean The SBX homeport is Adak Alaska which is located approximately midway along the Aleutian Islands chain The SBX has often been deployed to Pearl Harbor and elsewhere

Under the current constitutional interpretation Japanese missile defense systems would not be allowed to intercept missiles attacking the United States Likewise these systems are unable to protect a US naval vessel defending Japan from missile attack even if the US vessel was adjacent to a Japanese destroyer equipped with Aegis capability

Japan is almost wholly dependent upon oil supply from the Middle East According to the Energy Information Administration (EIA) Japanrsquos crude imports from the Middle East were estimated at 82 per cent in 201174 Currently Japan is seeking to reduce its oil imports from Iran whilst increasing oil imports from the Bahrain Kuwait Qatar Saudi Arabia and UAE in compensation

Japan has increased oil infrastructure investments in the Middle East over past years to improve its own prospects for energy security75

The ongoing dispute between Japan and China (and Taiwan) over the sovereignty of the gas reserves contained in (1) the ShirakabaChunxiao and (2) the AsunaroLongjing undersea oilgas fields in the Dong Hai have nearly led to a local

71 Nicholson Brendan Defence Editor ldquoAnti-ballistic missiles could be linked to Australian systemsrdquo The Australian 24 August 2013 retrieved from httpwwwtheaustraliancomaunational-affairs on 18 Feb 201372 THAAD is a US Army system designed to shoot down SRBMMRBMIRBM with an interceptor that slams into its target It can accept cues from Lockheedrsquos Aegis weapons system satellites and other external sensors It can work in tandem with the Patriot PAC-3 air-defense missile system 73 Wikipedia ldquoSea-based X-Band Radarrdquo retrieved from httpenwikipediaorgwikiSea-based_X-band_Radaron 18 February 2013 See also ldquoRaytheon Sea-Based X-Band Radar (SBX) for Missile Defencerdquo retrieved from wwwraytheoncomnewsroomfeaturecms04_018157pdf on 18 February 2013 Other Internet sources apply The latter pdf file provides an excellent schematic as to how SBX operates as a cornerstone of the US multi-tiered missile defense shield in the northern Pacific Ocean Other systems are detailed 74 EIA ldquoJapanrsquos crude imports by source 2011rdquo Country Analysis Briefs 4 June 2012 wwweiadoegov 75 Toichi Dr Tsutomu ldquoJapan-GCC States Interdependence through Energy Security and Investmentrdquo Institute of Energy Economics Japan (IEEJ) December 2007 wwwieeorjp email reporttkyieejorjp

P a g e | 28

conflict76 (Japanese names for these gas fields are denoted first followed by the Chinese name)

This seems to be the larger stress point ndash China and Japan conflict over lsquoclose oil and gas facilitiesrsquo to reduce both China and Japan reliance on Middle East oil Alternative oilgas and other mineral resources onunder the seabed will become a stress issue if compromise cannot be achieved for mutual benefit China is more likely to use its cash to buy via Sovereign Wealth Funds and other acquisition means (sometimes using Sinopec as a frontline lsquoscoutrsquo) to gain lsquocovert influencersquo to use non-Chinese companies in which it has controlling interests (eg Husky Oil) These shadow companies will undertake exploitation on Chinarsquos behalf

For (1) above the Chunxiao gas field is barely seven minutes flying time from the new Chinese air base at Shuimen in Fujian province The base is equipped with S-300 SAM missiles the J-10 and the Sukhoi Su-30 jet fighter plus unmanned ground attack drones China has established air supremacy over the Dong Hai Shuimen base is only 246 km from Taipei and 380 km from the uninhabited Tianyutai islands The latter are claimed by China and Japan as the Diaoyuta and Senkaku islands respectively

For (2) above the AsunaroLongjing gas field is located further north practically due east from Shanghai and Ningbo on the Chinese mainland Okinawa is situated further to the east in the western Pacific This is the general area more hotly disputed between Japan and China and of less interest to Taiwan

A comprehensive account of these disputes in the Dong Hai has been given by Professor Guo Rongxing at the Brookings Institute in Washington DC77

Japan is ranked third in the world in terms of its oil imports Consumption is greater than 44 MMbblday

It is to be noted that current disputes between China and ASEAN countries pertinent to undersea oilgas reserves in the Nan Hai (disputed Paracel and Spratly Islands) are not detailed in this paper The ASEAN countries involved in the disputes include Brunei Singapore Malaysia the Philippines and Vietnam Taken collectively these countries (except for Singapore) are not relatively significant oil importers when compared with Japan78 Brunei (013) Singapore (21) Malaysia (035) Philippines (034) and Vietnam (027)

South Korea (Republic of Korea) and North Korea (DPRK)

South Korea (ROK) has a much smaller Navy than that of Japan The ROK Navy comprises 170 commissioned ships and is larger by some 20 vessels than those commissioned in the JMSDF naval force The total displacement of the ROK fleet amounts to only some 180000 tons

76 Staff Reporter ldquoPrepare for War in 2013 PLA Forces toldrdquo wwwWantChinaTimescom 15 January 2013 77 Guo Professor Rongxing ldquoTerritorial Disputes and seabed petroleum exploitation some options for the east China Seardquo Peking University Spring 2010 released at the Brookings Institution Washington September 201078 Figures in parenthesis are expressed in million barrels of oil per day (MMbblday)

P a g e | 29

The ROK Navy includes some 20 destroyers and frigates 14 submarines 100 corvettes and fast attack craft amphibious and mine warfare ships auxiliary ships plus other supportive vessels

These include three modern guided-missile destroyers (DDG King Sejong the Great Class) six ASW destroyers (DD Chungmugong Yi Sunshin Class) three destroyers armed with SAM missiles (DD Kwanggaeto the Great Class) and eight older destroyers The King Sejong Class features the Aegis combat system combined with ANSPY-1D multi-function radar antennae This Class is one of the most heavily armed warships in the world79 The amphibious and assault ships include one landing transport helicopter carrier (LPH Dokdo Class) The submarine fleet includes nine 1200 ton SS (KSS-I) Chang Bogo Class three (KSS-II) Sohn Wonyil Class and two SSM Dolgorae Class midget class boats

As is the case with the JMSDF the ROK Navy interfaces and works well with the US Seventh Fleet

North Korea (DPRK) is known to have deployed some 800 Scud short-range tactical ballistic missiles pointed at targets in South Korea (ROK) These targets include Seoul ROK defence assets and US military infrastructure

In addition to SRBM MRBM IRBM the DPRK is thought to be developing ICBM capability This is of grave concern to the West The Sino-Russian bloc is providing technological assistance to the DPRK

North Korea missile inventories include Scud missiles (as above) 300 NoDong MRBM and 200 Musudan IRBM The Paektusan-2 (commonly known as the Taepodong-2) is thought to be not longer operational The Scud missiles have an approximate range of 320 to 500 km and can target all of South Korea The NoDong can target all of Japan with a range of 1300 km The Musudan with a range up to some 4000 km can strike US bases in Okinawa and Guam

The DPRK is thought to have at least 200 mobile missile launchers These are perceived to be the so-called transport erector launchers (TEL) including up to one hundred for short range Scud missiles fifty for medium-range NoDong missiles and fifty for long-range Musudan missiles This assessment was undertaken by the State run Korea Institute for Defense Analyses (KDA) in Seoul80

It is to be noted that China has the largest offensive missiles inventory in SE Asia Discussion on Chinarsquos missiles and emerging anti-missiles is beyond the scope of this paper but the threat remains to Australasia India ASEAN countries Taiwan Japan South Korea and to the US

ROK has a limited missiles inventory This comprises an offensive capability inherent in the following missile classes Cheolmae-2 (KM-SAM) surface-to-air missiles Chiron surface-to-air missiles C-Star ship-to-ship missiles Haeseong anti-ship missiles Hyunmoo III cruise missiles and Pegasus SAM81 This is not a complete list

79 Wikipedia ldquoList of Ships of the Republic of Korea Navyrdquo retrieved from httpenwikipediaorgwikiList_of_ships_of_the_Republic_of_Korea_Navy on 18 February 201380 ldquoN Korea thought to have 200 mobile missile launchers reportrdquo Yonhap ldquoMissile Threatrdquo posted by the Editor 17 May 2013 Seoul downloaded and printed 1915 hrs AEST Australia 3 June 201381Ibid Wikipedia ldquoList of Missiles by Countryrdquo

P a g e | 30

and actual numbers are not known The Hyunmoo III is made entirely with ROK developed components

In order to diffuse the situation with North Korea the ROK has stepped back from joining a regional homogeneous defense network with the US Instead the ROK has sought to go it alone with expressions of interest in Israelrsquos ldquoIron Domerdquo rocket interceptor system with development of an independent Air and Missile Defense Cell (AMD-Cell) in Osan with reliance on older PAC-2 technology and with indigenous manufacture of the new Cheongung MRBM destined for operational deployment commencing in 2015

Last year ROK Defense Minister Kim Kwan-jin indicated the South is working toward initial defense architecture and will implement the anti-missile web rdquowithin the next few yearsrdquo The ROK military also declared its intention to wrap up work on a missile shield by 2015 capable of shooting down SRBMMRBM fired from the North

ldquoIn contrast with Japanrsquos strong development and deployment of missile defense systems South Korearsquos efforts have been disappointing Despite the steadily increasing North Korean missile threat progressive South Korean Presidents deliberately downplayed the danger to South Korea in order to garner domestic support for their attempts to foster reconciliation with Pyongyangrdquo82

ldquoThey were fearful that deploying a missile defense system ndash or even criticizing North Korea over its military provocations and human rights abuses ndash would anger Pyongyang lead to a collapse of the inter-Korean engagement policy and strain relations with Chinardquo83

South Korea needs to improve its capabilities while Japan needs to improve its abilities (eg the will to use its existing capabilities)

According to Klinger South Korea should (1) deploy a multi-layered missile defense system that is interoperable with a US regional missile network to provide for a more coherent and effective defense of allied military facilities and the South Korean populace (2) purchase and deploy PAC-3 ground based missiles and SM-3 missiles (3) augment missile defense planning and exercises with US forces and initiate trilateral missile defense cooperation and exercises with the US and Japan (4) Implement and establish a regional missile defense network with Japan and (5) establish new military relationships including sharing security information For example linking sensors would improve defense capabilities against short range ballistic missiles84

South Korea is ranked seventh in the world by its oil imports Its consumption is around 25 MMbblday

In both the Middle East and SE Asia the developing missile race between many nations is reaching a damaging crescendo ndash a lsquoperfect stormrsquo crisis for humanity

Chinese Perspectives

82 Ibid Klinger83 Ibid page 1884 Ibid Klinger page 18

P a g e | 31

Chen Zhou has recently given valuable insight on Chinese perspectives as to the worldrsquos most important bilateral relationship85 That is the China-US equation To quote ldquo the US has been using missile defense systems as one of its effective measures to break the global strategic balance It declares that the purpose of establishing missile defense systems currently in Europe Asia and the Middle East is to deal with the threats from Iran and North Koreardquo This all embracing statement rightly or wrongly provides a convenient backcloth to Zhoursquos more complex and detailed perspectives enunciated elsewhere However to support this statement Zhou plays down the ever increasing threat of ICBMs by asserting very few countries have this capability This argument is fallacious

It only takes one country to successfully launch lethal multiple nuclear warheads from a single ICBM It is not the relatively small number of countries that matters but the ability for just a single ICBM to enter outer space by satellite or ground launch to follow its trajectory path to final destructive impact It is unwise to simply negate the very real missile threat be it regional or global

To quote again ldquo The Asia-Pacific Anti-Ballistic Missile Programs is an important part of US new Asia-Pacific strategy but it brings negative influences on Asia-Pacific peace security and stability and increases complex factors in solving relevant regional issues The Asia-Pacific Anti-Ballistic Missile Systems will raise the overall offensive and defensive level of US-Japan and other military alliances ldquo

This second statement implies the US is the villain in bringing negative influences to the Asia-Pacific region This is not true China has outlined its strategic position in Asia and the Western Pacific in a plethora of official and semi-official publications published in Mandarin on mainland China The ldquohawkishrdquo views of Senior Colonel Professor Liu Mingfu are well known86 In his book Professor Mingfu refers to rivalry between China and the US as a competition to be the leading country a conflict over who rises and falls to dominate the world ldquo to save itself to save the world China must prepare to become (sic worldrsquos) helmsmanrdquo Similar views are published in MandarinCantonese documents prevailing throughout China

Nowhere is it more evident than demonstrated by Chinarsquos expanding militarism

The US in evolving a new Asia-Pacific strategy is in reactive defensive mode It has responded directly to Chinarsquos maritime aggressiveness That is as demonstrated in littoral waters close to the Chinese mainland in the Taiwan Strait and visible in stated PLAN maritime intentions in the Indian Ocean Malacca Strait and Western Pacific The US Asia-Pacific Anti-Ballistic Missile Systems are most emphatically not offensive in nature ndash the systems are a defensive measure designed to counter increasing Chinese militarism It is not correct for General Chen Zhou to state the systems are offensive means to strengthen the defensive level of US-Japan ASEAN and other military alliances

It can be argued that Ballistic Missile Defence (BMD) Programs will not break global strategic balance and security In fact these Programs will achieve the very

85 Chen Zhou Major General ldquoAnti-Ballistic Missile Program Does No Good to World Peace and Securityrdquo China-US Focus General Chen Zhou is Director of the Center for National Defense Policy at the Academy of Military Sciences Peoplersquos Liberation Army (PLA) China 24 August 2012 86Liu Mingfu Senior Colonel Professor ldquoThe China Dreamrdquo 303-page book in Mandarin Professor Mingfu is at the elite National Defense University in Beijing book was published in China in March 2010

P a g e | 32

opposite Missile first strikes launched by the Sino-Russia bloc North Korea Syria Gaza Iran Pakistan and rogue states will be neutralised assuming the defense systems are 100 per cent effective Instead of Mutually Assured Destruction (MAD)87 as portrayed during the Cold War era with the adaptation of the new replacement doctrines of ldquocountervailing strategyrdquo or Strategic Defence Initiative (SDI) and BMD the acronym MAD could be interpreted as Mutually Assured Defense

This is a contentious issue open to further debate

General Zhou fails to acknowledge that SDI and BMD defensive systems have now taken over from offensive systems Far from exacerbating mistrust between smaller regional powers defensive systems will integrate homogeneous anti-missile systems into one-whole mega solution thus providing the smaller states with greater stability and security when confronted with offensive larger powers or bloc alliances

A colleague assisting the China Research Team by carefully reviewing this draft paper in depth has commented ldquoJust as lsquoless is morersquo is 100 defence a sign of passive offensiveimmunity in the eyes of othersrdquo88

Nor will anti-missile systems precipitate a new missile arms race An arms race is already de facto in place as the Sino-Russia bloc increases production of first strike offensive ballistic missiles encourages Iran and North Korea to assemble indigenously produced missiles and distributes missiles to rogue nations andor terrorist groups

As General Zhou states it would be ideal if ldquoChina will join hands with all other nations to build an international security environment with peace and stability equality and mutual trust and co-operation and win-win resultsrdquo But China must first cease offensive missile production stand down its missile batteries facing Taiwan avoid confrontation with Japan and ASEAN nations stop sending missiles and trajectory software to Iran North Korea and Syria and foster transparency and a more open dialogue with ANZAC ASEAN NATO and with the US

The means by which the Sino-Russian bloc expects to gain world hegemony before the end of the 21st Century are not discussed in this paper This is an important area for further research

Western Defence Budgets

Whilst China Russia Iran Pakistan and North Korea are currently expanding their respective military budgets the West led by the US (US$1 Trillion cut over the next 10 years) NATO (Cuts between10 to 25) Japan (17 cut) New Zealand (slight reduction NZ$001 Billion) and Australia (AUD$55 Billion cut) are significantly reducing their defence budgets

In general most Western governments are reducing their respective defence budgets mainly as a result of hard economic times Nonetheless it must be said that

87 The MAD military doctrine originated during the Cold War (1940s to 1990s) It was seen as helping to prevent any direct full-scale nuclear conflicts between Russia and the US It has since been superseded by new doctrines such as SDI BMD and ldquoStar Warsrdquo88 GPCAPT Maurice Dixon (Rtd) ndash see Acknowledgements section

P a g e | 33

spending and the delivery of effective military capability are relative especially when comparing volunteer and conscript forces

Hilary Clinton and Leon Panetta visited Australia in November 2012 largely to discuss Australiarsquos proposed cuts to its own defence budget The Australian government is likely to restrict the defence budget to 15 of GDP possibly rising to 20 of GDP as ldquofiscal circumstances allowrdquo (Draft 2013 Defence White Paper released 11 December 2012) The potential 156 of GDP represents the lowest proportion of gross domestic product expended on defence since 1938

The final version of the Australian Defence White Paper was released in the public domain on 3 May 201389 The paper outlines defence programs for the next twenty years It is not intended to review this important official document in the context of this paper

Notwithstanding this MAJGEN Jim Molan (Rtd) former commander of the coalition forces in Iraq recently stated ldquoI simply donrsquot understand how this government can set down long-term plans for a national disability scheme or education reforms and then set about finding the funds but then it simply refuses to set down an adequately funded long-term plan for defencerdquo90

It appears ludicrous when on the one hand the Gillard government is warning Australians as to the danger of expanding North Korean militarism but on the other hand is seriously reducing Australiarsquos defence budget Former Prime Minister Kevin Rudd consistently expressed concern about the military build up in China wanted to increase the defence budget and to purchase updated military hardware91

The Gillard government has been widely criticised for cutting or deferring up to AUD$25 billion in spending on defence since the release of the 2009 Defence White Paper And it has come under fire for imposing AUD$55 billion in cuts over four years in the 2012-2013 budget - the biggest in percentage terms since 195392

The Australian defence industry has complained about a dearth of defence projects and the loss of at least five thousand jobs since 2009 Dr Mark Thomson budget analyst at the Australian Strategic Policy Institute (ASPI) indicated recently that the government had imposed the budget cuts on top of an ambitious ten-year AUD$20 billion internal savings program93

Australia is seen as lsquodefencelessrsquo by some military analysts and entirely reliant upon US support in the event of a major conflict with a powerful adversary

89 ldquoDefence White Paper 2013rdquo Defending Australia and its National Interests Department of Defence (DOD) Commonwealth of Australia 148-pages ISBN 978-0-987 4958-0-8 3 May 2013 downloaded from wwwdefencegoau 90 See also ABC News ldquoRetired major general Jim Molan says Australia could struggle to defend itself by 2020rdquo Wednesday 8 August 2012 featured video91 Rudd Kevin was a former diplomat in Beijing and speaks fluent Mandarin92 Kerin John ldquoDefence Down by $1 billionrdquo Australian Financial Review Monday 11 February 201393 Ibid Kerin John

P a g e | 31

Chen Zhou has recently given valuable insight on Chinese perspectives as to the worldrsquos most important bilateral relationship85 That is the China-US equation To quote ldquo the US has been using missile defense systems as one of its effective measures to break the global strategic balance It declares that the purpose of establishing missile defense systems currently in Europe Asia and the Middle East is to deal with the threats from Iran and North Koreardquo This all embracing statement rightly or wrongly provides a convenient backcloth to Zhoursquos more complex and detailed perspectives enunciated elsewhere However to support this statement Zhou plays down the ever increasing threat of ICBMs by asserting very few countries have this capability This argument is fallacious

It only takes one country to successfully launch lethal multiple nuclear warheads from a single ICBM It is not the relatively small number of countries that matters but the ability for just a single ICBM to enter outer space by satellite or ground launch to follow its trajectory path to final destructive impact It is unwise to simply negate the very real missile threat be it regional or global

To quote again ldquo The Asia-Pacific Anti-Ballistic Missile Programs is an important part of US new Asia-Pacific strategy but it brings negative influences on Asia-Pacific peace security and stability and increases complex factors in solving relevant regional issues The Asia-Pacific Anti-Ballistic Missile Systems will raise the overall offensive and defensive level of US-Japan and other military alliances ldquo

This second statement implies the US is the villain in bringing negative influences to the Asia-Pacific region This is not true China has outlined its strategic position in Asia and the Western Pacific in a plethora of official and semi-official publications published in Mandarin on mainland China The ldquohawkishrdquo views of Senior Colonel Professor Liu Mingfu are well known86 In his book Professor Mingfu refers to rivalry between China and the US as a competition to be the leading country a conflict over who rises and falls to dominate the world ldquo to save itself to save the world China must prepare to become (sic worldrsquos) helmsmanrdquo Similar views are published in MandarinCantonese documents prevailing throughout China

Nowhere is it more evident than demonstrated by Chinarsquos expanding militarism

The US in evolving a new Asia-Pacific strategy is in reactive defensive mode It has responded directly to Chinarsquos maritime aggressiveness That is as demonstrated in littoral waters close to the Chinese mainland in the Taiwan Strait and visible in stated PLAN maritime intentions in the Indian Ocean Malacca Strait and Western Pacific The US Asia-Pacific Anti-Ballistic Missile Systems are most emphatically not offensive in nature ndash the systems are a defensive measure designed to counter increasing Chinese militarism It is not correct for General Chen Zhou to state the systems are offensive means to strengthen the defensive level of US-Japan ASEAN and other military alliances

It can be argued that Ballistic Missile Defence (BMD) Programs will not break global strategic balance and security In fact these Programs will achieve the very

85 Chen Zhou Major General ldquoAnti-Ballistic Missile Program Does No Good to World Peace and Securityrdquo China-US Focus General Chen Zhou is Director of the Center for National Defense Policy at the Academy of Military Sciences Peoplersquos Liberation Army (PLA) China 24 August 2012 86Liu Mingfu Senior Colonel Professor ldquoThe China Dreamrdquo 303-page book in Mandarin Professor Mingfu is at the elite National Defense University in Beijing book was published in China in March 2010

P a g e | 32

opposite Missile first strikes launched by the Sino-Russia bloc North Korea Syria Gaza Iran Pakistan and rogue states will be neutralised assuming the defense systems are 100 per cent effective Instead of Mutually Assured Destruction (MAD)87 as portrayed during the Cold War era with the adaptation of the new replacement doctrines of ldquocountervailing strategyrdquo or Strategic Defence Initiative (SDI) and BMD the acronym MAD could be interpreted as Mutually Assured Defense

This is a contentious issue open to further debate

General Zhou fails to acknowledge that SDI and BMD defensive systems have now taken over from offensive systems Far from exacerbating mistrust between smaller regional powers defensive systems will integrate homogeneous anti-missile systems into one-whole mega solution thus providing the smaller states with greater stability and security when confronted with offensive larger powers or bloc alliances

A colleague assisting the China Research Team by carefully reviewing this draft paper in depth has commented ldquoJust as lsquoless is morersquo is 100 defence a sign of passive offensiveimmunity in the eyes of othersrdquo88

Nor will anti-missile systems precipitate a new missile arms race An arms race is already de facto in place as the Sino-Russia bloc increases production of first strike offensive ballistic missiles encourages Iran and North Korea to assemble indigenously produced missiles and distributes missiles to rogue nations andor terrorist groups

As General Zhou states it would be ideal if ldquoChina will join hands with all other nations to build an international security environment with peace and stability equality and mutual trust and co-operation and win-win resultsrdquo But China must first cease offensive missile production stand down its missile batteries facing Taiwan avoid confrontation with Japan and ASEAN nations stop sending missiles and trajectory software to Iran North Korea and Syria and foster transparency and a more open dialogue with ANZAC ASEAN NATO and with the US

The means by which the Sino-Russian bloc expects to gain world hegemony before the end of the 21st Century are not discussed in this paper This is an important area for further research

Western Defence Budgets

Whilst China Russia Iran Pakistan and North Korea are currently expanding their respective military budgets the West led by the US (US$1 Trillion cut over the next 10 years) NATO (Cuts between10 to 25) Japan (17 cut) New Zealand (slight reduction NZ$001 Billion) and Australia (AUD$55 Billion cut) are significantly reducing their defence budgets

In general most Western governments are reducing their respective defence budgets mainly as a result of hard economic times Nonetheless it must be said that

87 The MAD military doctrine originated during the Cold War (1940s to 1990s) It was seen as helping to prevent any direct full-scale nuclear conflicts between Russia and the US It has since been superseded by new doctrines such as SDI BMD and ldquoStar Warsrdquo88 GPCAPT Maurice Dixon (Rtd) ndash see Acknowledgements section

P a g e | 33

spending and the delivery of effective military capability are relative especially when comparing volunteer and conscript forces

Hilary Clinton and Leon Panetta visited Australia in November 2012 largely to discuss Australiarsquos proposed cuts to its own defence budget The Australian government is likely to restrict the defence budget to 15 of GDP possibly rising to 20 of GDP as ldquofiscal circumstances allowrdquo (Draft 2013 Defence White Paper released 11 December 2012) The potential 156 of GDP represents the lowest proportion of gross domestic product expended on defence since 1938

The final version of the Australian Defence White Paper was released in the public domain on 3 May 201389 The paper outlines defence programs for the next twenty years It is not intended to review this important official document in the context of this paper

Notwithstanding this MAJGEN Jim Molan (Rtd) former commander of the coalition forces in Iraq recently stated ldquoI simply donrsquot understand how this government can set down long-term plans for a national disability scheme or education reforms and then set about finding the funds but then it simply refuses to set down an adequately funded long-term plan for defencerdquo90

It appears ludicrous when on the one hand the Gillard government is warning Australians as to the danger of expanding North Korean militarism but on the other hand is seriously reducing Australiarsquos defence budget Former Prime Minister Kevin Rudd consistently expressed concern about the military build up in China wanted to increase the defence budget and to purchase updated military hardware91

The Gillard government has been widely criticised for cutting or deferring up to AUD$25 billion in spending on defence since the release of the 2009 Defence White Paper And it has come under fire for imposing AUD$55 billion in cuts over four years in the 2012-2013 budget - the biggest in percentage terms since 195392

The Australian defence industry has complained about a dearth of defence projects and the loss of at least five thousand jobs since 2009 Dr Mark Thomson budget analyst at the Australian Strategic Policy Institute (ASPI) indicated recently that the government had imposed the budget cuts on top of an ambitious ten-year AUD$20 billion internal savings program93

Australia is seen as lsquodefencelessrsquo by some military analysts and entirely reliant upon US support in the event of a major conflict with a powerful adversary

89 ldquoDefence White Paper 2013rdquo Defending Australia and its National Interests Department of Defence (DOD) Commonwealth of Australia 148-pages ISBN 978-0-987 4958-0-8 3 May 2013 downloaded from wwwdefencegoau 90 See also ABC News ldquoRetired major general Jim Molan says Australia could struggle to defend itself by 2020rdquo Wednesday 8 August 2012 featured video91 Rudd Kevin was a former diplomat in Beijing and speaks fluent Mandarin92 Kerin John ldquoDefence Down by $1 billionrdquo Australian Financial Review Monday 11 February 201393 Ibid Kerin John

P a g e | 32

opposite Missile first strikes launched by the Sino-Russia bloc North Korea Syria Gaza Iran Pakistan and rogue states will be neutralised assuming the defense systems are 100 per cent effective Instead of Mutually Assured Destruction (MAD)87 as portrayed during the Cold War era with the adaptation of the new replacement doctrines of ldquocountervailing strategyrdquo or Strategic Defence Initiative (SDI) and BMD the acronym MAD could be interpreted as Mutually Assured Defense

This is a contentious issue open to further debate

General Zhou fails to acknowledge that SDI and BMD defensive systems have now taken over from offensive systems Far from exacerbating mistrust between smaller regional powers defensive systems will integrate homogeneous anti-missile systems into one-whole mega solution thus providing the smaller states with greater stability and security when confronted with offensive larger powers or bloc alliances

A colleague assisting the China Research Team by carefully reviewing this draft paper in depth has commented ldquoJust as lsquoless is morersquo is 100 defence a sign of passive offensiveimmunity in the eyes of othersrdquo88

Nor will anti-missile systems precipitate a new missile arms race An arms race is already de facto in place as the Sino-Russia bloc increases production of first strike offensive ballistic missiles encourages Iran and North Korea to assemble indigenously produced missiles and distributes missiles to rogue nations andor terrorist groups

As General Zhou states it would be ideal if ldquoChina will join hands with all other nations to build an international security environment with peace and stability equality and mutual trust and co-operation and win-win resultsrdquo But China must first cease offensive missile production stand down its missile batteries facing Taiwan avoid confrontation with Japan and ASEAN nations stop sending missiles and trajectory software to Iran North Korea and Syria and foster transparency and a more open dialogue with ANZAC ASEAN NATO and with the US

The means by which the Sino-Russian bloc expects to gain world hegemony before the end of the 21st Century are not discussed in this paper This is an important area for further research

Western Defence Budgets

Whilst China Russia Iran Pakistan and North Korea are currently expanding their respective military budgets the West led by the US (US$1 Trillion cut over the next 10 years) NATO (Cuts between10 to 25) Japan (17 cut) New Zealand (slight reduction NZ$001 Billion) and Australia (AUD$55 Billion cut) are significantly reducing their defence budgets

In general most Western governments are reducing their respective defence budgets mainly as a result of hard economic times Nonetheless it must be said that

87 The MAD military doctrine originated during the Cold War (1940s to 1990s) It was seen as helping to prevent any direct full-scale nuclear conflicts between Russia and the US It has since been superseded by new doctrines such as SDI BMD and ldquoStar Warsrdquo88 GPCAPT Maurice Dixon (Rtd) ndash see Acknowledgements section

P a g e | 33

spending and the delivery of effective military capability are relative especially when comparing volunteer and conscript forces

Hilary Clinton and Leon Panetta visited Australia in November 2012 largely to discuss Australiarsquos proposed cuts to its own defence budget The Australian government is likely to restrict the defence budget to 15 of GDP possibly rising to 20 of GDP as ldquofiscal circumstances allowrdquo (Draft 2013 Defence White Paper released 11 December 2012) The potential 156 of GDP represents the lowest proportion of gross domestic product expended on defence since 1938

The final version of the Australian Defence White Paper was released in the public domain on 3 May 201389 The paper outlines defence programs for the next twenty years It is not intended to review this important official document in the context of this paper

Notwithstanding this MAJGEN Jim Molan (Rtd) former commander of the coalition forces in Iraq recently stated ldquoI simply donrsquot understand how this government can set down long-term plans for a national disability scheme or education reforms and then set about finding the funds but then it simply refuses to set down an adequately funded long-term plan for defencerdquo90

It appears ludicrous when on the one hand the Gillard government is warning Australians as to the danger of expanding North Korean militarism but on the other hand is seriously reducing Australiarsquos defence budget Former Prime Minister Kevin Rudd consistently expressed concern about the military build up in China wanted to increase the defence budget and to purchase updated military hardware91

The Gillard government has been widely criticised for cutting or deferring up to AUD$25 billion in spending on defence since the release of the 2009 Defence White Paper And it has come under fire for imposing AUD$55 billion in cuts over four years in the 2012-2013 budget - the biggest in percentage terms since 195392

The Australian defence industry has complained about a dearth of defence projects and the loss of at least five thousand jobs since 2009 Dr Mark Thomson budget analyst at the Australian Strategic Policy Institute (ASPI) indicated recently that the government had imposed the budget cuts on top of an ambitious ten-year AUD$20 billion internal savings program93

Australia is seen as lsquodefencelessrsquo by some military analysts and entirely reliant upon US support in the event of a major conflict with a powerful adversary

89 ldquoDefence White Paper 2013rdquo Defending Australia and its National Interests Department of Defence (DOD) Commonwealth of Australia 148-pages ISBN 978-0-987 4958-0-8 3 May 2013 downloaded from wwwdefencegoau 90 See also ABC News ldquoRetired major general Jim Molan says Australia could struggle to defend itself by 2020rdquo Wednesday 8 August 2012 featured video91 Rudd Kevin was a former diplomat in Beijing and speaks fluent Mandarin92 Kerin John ldquoDefence Down by $1 billionrdquo Australian Financial Review Monday 11 February 201393 Ibid Kerin John

P a g e | 33

spending and the delivery of effective military capability are relative especially when comparing volunteer and conscript forces

Hilary Clinton and Leon Panetta visited Australia in November 2012 largely to discuss Australiarsquos proposed cuts to its own defence budget The Australian government is likely to restrict the defence budget to 15 of GDP possibly rising to 20 of GDP as ldquofiscal circumstances allowrdquo (Draft 2013 Defence White Paper released 11 December 2012) The potential 156 of GDP represents the lowest proportion of gross domestic product expended on defence since 1938

The final version of the Australian Defence White Paper was released in the public domain on 3 May 201389 The paper outlines defence programs for the next twenty years It is not intended to review this important official document in the context of this paper

Notwithstanding this MAJGEN Jim Molan (Rtd) former commander of the coalition forces in Iraq recently stated ldquoI simply donrsquot understand how this government can set down long-term plans for a national disability scheme or education reforms and then set about finding the funds but then it simply refuses to set down an adequately funded long-term plan for defencerdquo90

It appears ludicrous when on the one hand the Gillard government is warning Australians as to the danger of expanding North Korean militarism but on the other hand is seriously reducing Australiarsquos defence budget Former Prime Minister Kevin Rudd consistently expressed concern about the military build up in China wanted to increase the defence budget and to purchase updated military hardware91

The Gillard government has been widely criticised for cutting or deferring up to AUD$25 billion in spending on defence since the release of the 2009 Defence White Paper And it has come under fire for imposing AUD$55 billion in cuts over four years in the 2012-2013 budget - the biggest in percentage terms since 195392

The Australian defence industry has complained about a dearth of defence projects and the loss of at least five thousand jobs since 2009 Dr Mark Thomson budget analyst at the Australian Strategic Policy Institute (ASPI) indicated recently that the government had imposed the budget cuts on top of an ambitious ten-year AUD$20 billion internal savings program93

Australia is seen as lsquodefencelessrsquo by some military analysts and entirely reliant upon US support in the event of a major conflict with a powerful adversary

89 ldquoDefence White Paper 2013rdquo Defending Australia and its National Interests Department of Defence (DOD) Commonwealth of Australia 148-pages ISBN 978-0-987 4958-0-8 3 May 2013 downloaded from wwwdefencegoau 90 See also ABC News ldquoRetired major general Jim Molan says Australia could struggle to defend itself by 2020rdquo Wednesday 8 August 2012 featured video91 Rudd Kevin was a former diplomat in Beijing and speaks fluent Mandarin92 Kerin John ldquoDefence Down by $1 billionrdquo Australian Financial Review Monday 11 February 201393 Ibid Kerin John

P a g e | 34

Some ASEAN countries (particularly lsquolynchpinrsquo Singapore and resurgent Vietnam) together with India are rapidly increasing their defence budgets to meet the perceived expanding Chinese and North Korean militarism

It would be appropriate to produce an academic research paper comparing defence budgets in real terms using the pertinent indices for the above countries

Findings and Conclusions

As military history has often demonstrated once again the clouds of war are gathering This time in SE Asia seen as the dark side of our planet The military balance in the SE Asian littoral in the Western Pacific favours a natural concentration of PLAN naval assets By contrast the US deploys its strategic weight globally -dispersed among widely spaced bases Bahrain Diego Garcia and Guam are simply too far geographically removed from Chinese controlled local waters

Notwithstanding the newly revamped Cam Ranh Bay (Vietnam) and the pre-established Okinawa naval bases are closest to Chinese controlled waters These bases will enable the US to deploy military assets to counter PLAN initiatives

The stage is set for future conflict in many theatres This time Professor Hugh White outlines a worst case scenario in his new book94 Professor White stipulates the US has responded to Chinarsquos strident assertion of its claims to the disputed waters and islands of the Nan Hai by increasing its support for other claimants such as Vietnam and the Philippines His brutal conclusion is ldquothat once its willingness (US) to support its Asian friends and allies is put to the test America can only protect its position in Asia by willing to engage in combat with Chinese forcesrdquo

In view of Chinarsquos continuing purchases of Iranian oil thus circumventing the Western imposed sanctions against Iran it may be concluded the threat to close the Strait of Hormuz is a lesser problem than the current political disputes in the Nan Hai (South China Sea) and Dong Hai (East China Sea) China does not want the Strait closed The threatened closure may well be a hollow gesture even if it is backed by an expanding IRGCN and IRIN The past history of missile attacks on oil tankers may not be repeated

Today the most critical flashpoints are at the eastern end of the oil supply conduit These are in the Nan Hai and Dong Hai These seas contain not just oil and gas in apparent abundance but also large amounts of other seabed resources including sand and gravel shell and carbonate sand heavy-metal sand phosphorus precious coral rock salt as well as varying amounts of titanium gold platinum zircon and other heavy metals Chinese geologists believe immense wealth on the seabed can be extracted using new technology95

Chinese assessments of the seabed wealth may be grossly inflated Wood-Mackenzie estimates a total of 25 billion barrels equivalent of proven oil and gas are

94 White Professor Hugh ldquoThe China Choicerdquo published by Black Inc in Australia 2012 9781863955621 (pbk)95 In May 2012 CNOOC announced it had developed a deep-sea oil platform at a cost of roughly US$1 billion capable of extracting oil at a depth of 12000 metres

P a g e | 35

in the Nan Hai This estimate is 100 times less than China claims Western oil companies such as Royal Dutch Shell and Unocal have now withdrawn from joint venture projects with Chinese National Offshore Oil Corporation (CNOOC) and Sinopec to explore gas reserves in the XihuOkinawa trough96 Japan has also withdrawn from joint venture Only a couple of joint venture foreign oil companies remain in the Dong Hai Husky Oil China a subsidiary of Canadian Husky Energy holds an exploration block in the Dong Hai It is also present in the Nan Hai Primeline Petroleum Corp has entered into joint venture with CNOOC to build a gas pipeline to Wenzhou

China has blatantly claimed sovereignty over these resources disputing UNCLOS and EEZ international boundaries Consequently China has frustrated and upset many ASEAN countries (Brunei Malaysia the Philippines and Vietnam) littoral to the Nan Hai and Taiwan Japan and South Korea littoral to the Dong Hai These seven countries have been pushed aside In implementing its new ldquoAsia Pivotrdquo foreign policy the US may well be forced to arbitrate on behalf of these disadvantaged countries

The late Chinese leader Deng Xiaoping proposed the competing countries should ldquoput aside differences and jointly develop resourcesrdquo This is not happening To quote ldquoGiven the opaque Chinese decision-making process itrsquos tempting to speculate whether the combination of maritime military ambitions mercantilist resource policies inflated hopes of energy and new oil technology capabilities may account for the apparent abandoning of Dengrsquos policiesrdquo97

Whoever controls the irreplaceable umbilical cord controls the lifespan of our demand-driven thirsty consumer world as we know it today The worldrsquos two remaining fully active imperial navies China and the US will probably confront each other before the end of the 21st Century The modernised Indian Navy will also play a part in this endgame as will a rejuvenated Russian Navy It is known Russia intends to send nuclear submarines to southern seas98 The next 87 years are critical mass which could explode and destroy us all That is a lsquocritical massrsquo of damaging and interactive factors which could eventually destroy our planet

This controversial assessment is by nature an empirical statement There is no hard evidence for this China has too much to lose in conflict with JapanUS North Korea and Iran are perhaps just bluster to keep despotic heads of State in power This may be short term only as their populations cannot be hoodwinked for much longer if economic sanctions bring more pain to them Some defense analysts advocate for an lsquoAsian Uprisingrsquo as early as 2015 as a convenient solution

96 EIA East China Sea Country Analysis last updated 25 September 2012 downloaded from httpwwweiagovcountriesregions-topicscfmfips=ECS on 16 February 201397 Manning Robert A ldquoIn Disputes Over Asian Seas Winner May Take Zilchrdquo YaleGlobal Online published on YaleGlobal Online Magazine 14 January 2013 downloaded from httpyaleglobalyaleedu on 15 February 2013 Robert Manning is a Senior Fellow with the Brent Scowcroft Center for International Security at the Atlantic Council98 ldquoRussia to send nuclear submarines to southern seasrdquo authored by Alexei Anishchuk Reuters Moscow Saturday 1 June 2013 These could be the relatively new Borei Class submarines with up to 16 nuclear SLBM

P a g e | 35

in the Nan Hai This estimate is 100 times less than China claims Western oil companies such as Royal Dutch Shell and Unocal have now withdrawn from joint venture projects with Chinese National Offshore Oil Corporation (CNOOC) and Sinopec to explore gas reserves in the XihuOkinawa trough96 Japan has also withdrawn from joint venture Only a couple of joint venture foreign oil companies remain in the Dong Hai Husky Oil China a subsidiary of Canadian Husky Energy holds an exploration block in the Dong Hai It is also present in the Nan Hai Primeline Petroleum Corp has entered into joint venture with CNOOC to build a gas pipeline to Wenzhou

China has blatantly claimed sovereignty over these resources disputing UNCLOS and EEZ international boundaries Consequently China has frustrated and upset many ASEAN countries (Brunei Malaysia the Philippines and Vietnam) littoral to the Nan Hai and Taiwan Japan and South Korea littoral to the Dong Hai These seven countries have been pushed aside In implementing its new ldquoAsia Pivotrdquo foreign policy the US may well be forced to arbitrate on behalf of these disadvantaged countries

The late Chinese leader Deng Xiaoping proposed the competing countries should ldquoput aside differences and jointly develop resourcesrdquo This is not happening To quote ldquoGiven the opaque Chinese decision-making process itrsquos tempting to speculate whether the combination of maritime military ambitions mercantilist resource policies inflated hopes of energy and new oil technology capabilities may account for the apparent abandoning of Dengrsquos policiesrdquo97

Whoever controls the irreplaceable umbilical cord controls the lifespan of our demand-driven thirsty consumer world as we know it today The worldrsquos two remaining fully active imperial navies China and the US will probably confront each other before the end of the 21st Century The modernised Indian Navy will also play a part in this endgame as will a rejuvenated Russian Navy It is known Russia intends to send nuclear submarines to southern seas98 The next 87 years are critical mass which could explode and destroy us all That is a lsquocritical massrsquo of damaging and interactive factors which could eventually destroy our planet

This controversial assessment is by nature an empirical statement There is no hard evidence for this China has too much to lose in conflict with JapanUS North Korea and Iran are perhaps just bluster to keep despotic heads of State in power This may be short term only as their populations cannot be hoodwinked for much longer if economic sanctions bring more pain to them Some defense analysts advocate for an lsquoAsian Uprisingrsquo as early as 2015 as a convenient solution

96 EIA East China Sea Country Analysis last updated 25 September 2012 downloaded from httpwwweiagovcountriesregions-topicscfmfips=ECS on 16 February 201397 Manning Robert A ldquoIn Disputes Over Asian Seas Winner May Take Zilchrdquo YaleGlobal Online published on YaleGlobal Online Magazine 14 January 2013 downloaded from httpyaleglobalyaleedu on 15 February 2013 Robert Manning is a Senior Fellow with the Brent Scowcroft Center for International Security at the Atlantic Council98 ldquoRussia to send nuclear submarines to southern seasrdquo authored by Alexei Anishchuk Reuters Moscow Saturday 1 June 2013 These could be the relatively new Borei Class submarines with up to 16 nuclear SLBM

P a g e | 36

The following questions arise (1) does the West perceive ChinaRussia teaming up against the USJapanIndia and others for a massive bust up in the Pacific Ocean (2) Will China disrupt the Arabian Gulf (as it needs the oilgas itself) (3) Could the Arabian Gulf not produceexport so much that the non-OPEC countries (together with new exploration areas99) could not take up some of the slack (4) Does the acceleration away from fossil fuel also reduce the need for Arabian Gulf oil

As Saudi Arabia has set targets to be off domestic fossil fuel use by 2035 this sends an important message to the West The same could not be said for China

Military interdiction to the global oil supply will undoubtedly serve to dampen down the critical mass as lack of oil will inhibit the movements of conventional military forces But this is only one isolated factor amongst the total range of problems confronting our planet

One other important factor worthy of mention is the potential for another US recession stemming from the so-called lsquofiscal-cliffrsquo in Washington DC In January 2013 the US narrowly avoided the lsquofiscal cliffrsquo But as the US National Debt is in excess of some $16 trillion and Congress has yet to agree on how to implement savage government spending cuts the US economy could still slide into another recession If this transpires it will severely constrict the lsquopulse ratersquo imbued in the lifeblood umbilical cord global oil supply Demand for oil will plummet

There is a degree of optimism in the US at present The economy appears to be slowly recovering Perhaps this could be associated with the prospects for a second oil boom as indigenous oil production increases

The other constituent factors inherent in the critical mass include (apart from military interdiction) climate change (scientists assert the melting Arctic permafrost will increase the worldrsquos temperature by 4 to 6 degrees Centigrade this Century effectively doubling previous estimates) environmental degradation ldquosee-sawrdquo crisis economics high sovereign debt levels (Europe) fallout from global currency war production shrinkages (declining manufacturing indices) overpopulation (China is considering revising its one child policy to permit a second child) resource depletion food and water scarcity (China is destined to run out of water and food to feed its 135 billion population) propensity to engage in warfare (proliferation of weapons including WMD missiles and anti-missiles asymmetric warfare terrorism local wars and cyber espionage) regime changes and the prevailing geopolitics The new leadership in China must be taken into consideration

Historically food water and resource scarcity for a growing population and population cross-border migration due to negative climate change impacts is the real lsquothreat multiplierrsquo issue in SE Asia Pertinent countries are China India Sri Lanka Pakistan Bangladesh and Myanmar

In respect of missiles and anti-missiles the so-called ldquoStar Warsrdquo (Strategic Defense Initiative signature program for missile defense) coined by President Reagan in

99 New Arctic exploration areas opened up by accelerating climate change are likely to produce significant quantities of oilgas this Century and perhaps beyond

P a g e | 37

1983 is today still conceptually feasible The original concept has been transmogrified from a national defense system to theatre missile defense Its scope has been altered from a global to a more regional coverage

This paper in analysing the diverse problems surrounding the global oil supply conduit briefly reviews the latest variants (ie theatre anti-ballistic missile systems) of the Star Wars concept These variants are in progress pending successful installation in the regional areaslittoral nations bordering on the sea transit routes for moving bulk shipments of oil around the world As stated elsewhere the paper is mainly limited to discussions on missile arsenalsmissile shields for those countries adjacent to the global oil supply conduit from the Arabian Gulf ultimately to SE Asia mainland China Japan and South Korea

In July 2012 US defense firm Raytheon was awarded a $636 million seven year contract to continue producing its missile based Exo-atmospheric Kill Vehicle (EKV) delivery device Travelling at 15000 miles per hour ndash called a kinetic device ndash the EKV is designed to simply ram into a hostile incoming nuclear device

In reality in one form or another a hybrid Star Wars concept will probably be invoked before the end of the 21st Century Russia and China are bitterly opposed to any variant of the Star Wars concept100

Oil tyranny and missile mania is the scourge of the 21st Century

Global political economic and military equilibrium no longer exists between the Sino-Russian Iranian and North Korean power blocs and between the West led by the US and its allies together with NATO ANZAC ASEAN and smaller nations In the Cold War era the mutually assured destruction (MAD) military doctrine did promise a modicum of equilibrium

Perhaps there never has been real equilibrium

The so-called lsquoaxis-of-evilrsquo (President Bush) has transformed into a new offensive arc This stretches from western Russia through the Caucasus region through Iran and Afghanistan to former Tibet skirting the borders of Myanmar Laos Vietnam and the Chinese coastline northwards to North Korea thence to eastern Russia

Behind this offensive arc a multitude of hostile missiles are poised ready to target Western interests and military assets It is impossible to correctly estimate how many missiles are aimed at the West The number must be in the thousands This paper has alluded to missile numbers for two nations China (4000) and North Korea (1300) but these are largely guesswork

In direct response the West has contrived a defensive arc This originates in Poland traverses Turkey and includes Israel the Gulf littoral states (apart from Iran)

100 ldquoMissiles and Missile Defense Systemsrdquo Times Topics The New York Times Monday 21 January 2013 and Chen Zhou Major General ldquoAnti-Ballistic Missile Program Does No Good to World Peace and Securityrdquo Director of the Center for National Defense Policy at the Academy of Military Science Peoplersquos Liberation Army (PLA) China 24 August 2012

P a g e | 38

Djibouti India Singapore the Philippines and Vietnam to include Taiwan Japan and South Korea Diego Garcia and Guam bolster the defensive arc from afar

Along the defensive arc the West spearheaded by the US is urgently positioning a homogeneous anti-missile shield system Some nations prefer to develop their own indigenous systems namely Israel Taiwan and South Korea There is no certainty the in-place anti-missile shields will be able to destroy all incoming hostile missiles

To add complexity the oil supply transit conduit bisects the two arcs running as it does from the Strait of Hormuz across the northern Indian Ocean through the Malacca strait into the contested Nan Hai through the Taiwan Strait into the disputed Dong Hai to ultimate destinations in China Japan and South Korea

Oil and missiles are a dangerous volatile mix endangering world peace In WWII the U-boat menace in the Atlantic gave example of the pillage and wanton destructive power of torpedoes able to strike at whim amongst vulnerable lsquositting-duckrsquo oil tanker convoys The missile onslaught in the Oil Tanker War fortunately was not as destructive compared to WWII However it could have been much worse

Missiles may be used as a consequence of conflict starting but other technology and approaches RPVs cyber economic and asymmetric warfare are more likely to be the precursors and seed corn of conflict

ldquoNemesisrdquo an interpretationsymbolic relevance

The declining world economy will surely one day tilt our planet towards a disastrous global war of unforseen dimension

The above noxious ingredients have the potential to destroy our lifestyle within this Century

It has often been said by pundits that the world with an estimated total current population of over six billion destined to grow to as much as nine plus billion in a few decades will no longer be able to sustain its expanding population This will be the planetrsquos true retribution to forever-greedy mankind Nemesis indeed in the so-called Asian Century

Mother Earth will not forgive us for raping our planet In the context of this paper the competing nations of the world are perceived as Mother Earthrsquos delinquent children Humanity is in dire threat of extinction Must we eventually abandon our planet Tomorrow will there be a Chinese penal institution on Mars or will there be a UN contrived free-world colony101

Must mankind always relapse to the past to bring on a future to it which in turn relapses to repeat the past history of world conflicts thus engendering fresh conflicts This is a never ending tragedy for us all101 Robinson Kim Stanley ldquoThe Mars Trilogyrdquo Spectra publisher Archives Fine Books Charlotte street Brisbane Queensland Australia

P a g e | 39

Our progress in the 21st Century is often said to be limited only by our imagination Are we constrained by a straitjacket in the form of the potential for future conflict in a world of ever diminishing resources

Notwithstanding the findings and conclusions expressed above there is a glimmer of hope for mankind lsquoA saviour candle in the dark so to speakrsquo not directly related to discussion in this paper This is seen as too late for the Syrian Crisis It may be hard to believe but according to research due to be published in early 2013 a world without war may be evident this century Professor Haavard Hegre and colleagues at the Peace Research Institute Oslo have advanced a statistical model predicting that global conflict will halve within the next 40 years102

The predictions are based on dynamic multinomial logit model estimation on a 1970-2009 cross-sectional dataset of changes between no armed conflict minor conflict and major conflict Core exogenous predictors are population size infant mortality rates demographic composition education levels oil dependence ethnic changes and neighbourhood characteristics These predictors are somewhat analogous to the critical mass factors explained above

Using this model the Oslo research suggests conflicts in Libya Tajikistan Syria Senegal Senegal Ivory Coast Mauritania and Iraq will probably end in the next five years By 2017 the risk of war will be greatest in India Ethiopia Philippines Uganda and Myanmar By 2050 as the number of countries at war falls from one in six to one in 12 the risk of conflict will be greatest in India Nigeria Sudan Ethiopia and Tanzania

Theoretically it may be possible to substitute pertinent critical mass factors outlined above for some of the core exogenous predictors used in the logit model For example climate change environmental degradation ldquosee-sawrdquo crisis economics geopolitical indices overpopulation resource depletion food and water scarcity and weapons proliferation Essentially oil dependence should be retained perhaps with some of the other original predictors

The logit model could possibly be revised to reflect arbitrary political groupings for the larger powers For instance the Sino-Russian bloc coupled together with lsquosurrogatersquo Iran Syria Sudan Pakistan North Korea and rogue nations Similarly the West grouped together as another bloc comprising ANZAC ASEAN NATO Canada and the US These random choices and groupings could introduce new statistical inferences into the logit model

By doing this the logit model may more closely parallel the global dichotomy perceived between China and the US The so-called ldquoChina-US Equationrdquo ndash undoubtedly the worldrsquos most important relationship It remains to be seen whether the logit model can be pragmatically revised in the manner described If so new predictions for armed conflict from lsquo2010 to 2100rsquo may be closer to the truth

102 Hegre Professor Haavard Department of Political Science Oslo in collaboration with the Peace Research Institute Oslo Forthcoming publication authored by Hegre Haavard Joakim Karlsen Haavard Mokleiv Nygaard Henrik Urdal and Haavard Strand 2013 entitled ldquopredicting Armed Conflict 2011 ndash 2050rdquo to be published in Wiley International Studies Quarterly forthcoming email address haavardhegrestvuiono

P a g e | 37

1983 is today still conceptually feasible The original concept has been transmogrified from a national defense system to theatre missile defense Its scope has been altered from a global to a more regional coverage

This paper in analysing the diverse problems surrounding the global oil supply conduit briefly reviews the latest variants (ie theatre anti-ballistic missile systems) of the Star Wars concept These variants are in progress pending successful installation in the regional areaslittoral nations bordering on the sea transit routes for moving bulk shipments of oil around the world As stated elsewhere the paper is mainly limited to discussions on missile arsenalsmissile shields for those countries adjacent to the global oil supply conduit from the Arabian Gulf ultimately to SE Asia mainland China Japan and South Korea

In July 2012 US defense firm Raytheon was awarded a $636 million seven year contract to continue producing its missile based Exo-atmospheric Kill Vehicle (EKV) delivery device Travelling at 15000 miles per hour ndash called a kinetic device ndash the EKV is designed to simply ram into a hostile incoming nuclear device

In reality in one form or another a hybrid Star Wars concept will probably be invoked before the end of the 21st Century Russia and China are bitterly opposed to any variant of the Star Wars concept100

Oil tyranny and missile mania is the scourge of the 21st Century

Global political economic and military equilibrium no longer exists between the Sino-Russian Iranian and North Korean power blocs and between the West led by the US and its allies together with NATO ANZAC ASEAN and smaller nations In the Cold War era the mutually assured destruction (MAD) military doctrine did promise a modicum of equilibrium

Perhaps there never has been real equilibrium

The so-called lsquoaxis-of-evilrsquo (President Bush) has transformed into a new offensive arc This stretches from western Russia through the Caucasus region through Iran and Afghanistan to former Tibet skirting the borders of Myanmar Laos Vietnam and the Chinese coastline northwards to North Korea thence to eastern Russia

Behind this offensive arc a multitude of hostile missiles are poised ready to target Western interests and military assets It is impossible to correctly estimate how many missiles are aimed at the West The number must be in the thousands This paper has alluded to missile numbers for two nations China (4000) and North Korea (1300) but these are largely guesswork

In direct response the West has contrived a defensive arc This originates in Poland traverses Turkey and includes Israel the Gulf littoral states (apart from Iran)

100 ldquoMissiles and Missile Defense Systemsrdquo Times Topics The New York Times Monday 21 January 2013 and Chen Zhou Major General ldquoAnti-Ballistic Missile Program Does No Good to World Peace and Securityrdquo Director of the Center for National Defense Policy at the Academy of Military Science Peoplersquos Liberation Army (PLA) China 24 August 2012

P a g e | 38

Djibouti India Singapore the Philippines and Vietnam to include Taiwan Japan and South Korea Diego Garcia and Guam bolster the defensive arc from afar

Along the defensive arc the West spearheaded by the US is urgently positioning a homogeneous anti-missile shield system Some nations prefer to develop their own indigenous systems namely Israel Taiwan and South Korea There is no certainty the in-place anti-missile shields will be able to destroy all incoming hostile missiles

To add complexity the oil supply transit conduit bisects the two arcs running as it does from the Strait of Hormuz across the northern Indian Ocean through the Malacca strait into the contested Nan Hai through the Taiwan Strait into the disputed Dong Hai to ultimate destinations in China Japan and South Korea

Oil and missiles are a dangerous volatile mix endangering world peace In WWII the U-boat menace in the Atlantic gave example of the pillage and wanton destructive power of torpedoes able to strike at whim amongst vulnerable lsquositting-duckrsquo oil tanker convoys The missile onslaught in the Oil Tanker War fortunately was not as destructive compared to WWII However it could have been much worse

Missiles may be used as a consequence of conflict starting but other technology and approaches RPVs cyber economic and asymmetric warfare are more likely to be the precursors and seed corn of conflict

ldquoNemesisrdquo an interpretationsymbolic relevance

The declining world economy will surely one day tilt our planet towards a disastrous global war of unforseen dimension

The above noxious ingredients have the potential to destroy our lifestyle within this Century

It has often been said by pundits that the world with an estimated total current population of over six billion destined to grow to as much as nine plus billion in a few decades will no longer be able to sustain its expanding population This will be the planetrsquos true retribution to forever-greedy mankind Nemesis indeed in the so-called Asian Century

Mother Earth will not forgive us for raping our planet In the context of this paper the competing nations of the world are perceived as Mother Earthrsquos delinquent children Humanity is in dire threat of extinction Must we eventually abandon our planet Tomorrow will there be a Chinese penal institution on Mars or will there be a UN contrived free-world colony101

Must mankind always relapse to the past to bring on a future to it which in turn relapses to repeat the past history of world conflicts thus engendering fresh conflicts This is a never ending tragedy for us all101 Robinson Kim Stanley ldquoThe Mars Trilogyrdquo Spectra publisher Archives Fine Books Charlotte street Brisbane Queensland Australia

P a g e | 39

Our progress in the 21st Century is often said to be limited only by our imagination Are we constrained by a straitjacket in the form of the potential for future conflict in a world of ever diminishing resources

Notwithstanding the findings and conclusions expressed above there is a glimmer of hope for mankind lsquoA saviour candle in the dark so to speakrsquo not directly related to discussion in this paper This is seen as too late for the Syrian Crisis It may be hard to believe but according to research due to be published in early 2013 a world without war may be evident this century Professor Haavard Hegre and colleagues at the Peace Research Institute Oslo have advanced a statistical model predicting that global conflict will halve within the next 40 years102

The predictions are based on dynamic multinomial logit model estimation on a 1970-2009 cross-sectional dataset of changes between no armed conflict minor conflict and major conflict Core exogenous predictors are population size infant mortality rates demographic composition education levels oil dependence ethnic changes and neighbourhood characteristics These predictors are somewhat analogous to the critical mass factors explained above

Using this model the Oslo research suggests conflicts in Libya Tajikistan Syria Senegal Senegal Ivory Coast Mauritania and Iraq will probably end in the next five years By 2017 the risk of war will be greatest in India Ethiopia Philippines Uganda and Myanmar By 2050 as the number of countries at war falls from one in six to one in 12 the risk of conflict will be greatest in India Nigeria Sudan Ethiopia and Tanzania

Theoretically it may be possible to substitute pertinent critical mass factors outlined above for some of the core exogenous predictors used in the logit model For example climate change environmental degradation ldquosee-sawrdquo crisis economics geopolitical indices overpopulation resource depletion food and water scarcity and weapons proliferation Essentially oil dependence should be retained perhaps with some of the other original predictors

The logit model could possibly be revised to reflect arbitrary political groupings for the larger powers For instance the Sino-Russian bloc coupled together with lsquosurrogatersquo Iran Syria Sudan Pakistan North Korea and rogue nations Similarly the West grouped together as another bloc comprising ANZAC ASEAN NATO Canada and the US These random choices and groupings could introduce new statistical inferences into the logit model

By doing this the logit model may more closely parallel the global dichotomy perceived between China and the US The so-called ldquoChina-US Equationrdquo ndash undoubtedly the worldrsquos most important relationship It remains to be seen whether the logit model can be pragmatically revised in the manner described If so new predictions for armed conflict from lsquo2010 to 2100rsquo may be closer to the truth

102 Hegre Professor Haavard Department of Political Science Oslo in collaboration with the Peace Research Institute Oslo Forthcoming publication authored by Hegre Haavard Joakim Karlsen Haavard Mokleiv Nygaard Henrik Urdal and Haavard Strand 2013 entitled ldquopredicting Armed Conflict 2011 ndash 2050rdquo to be published in Wiley International Studies Quarterly forthcoming email address haavardhegrestvuiono

P a g e | 38

Djibouti India Singapore the Philippines and Vietnam to include Taiwan Japan and South Korea Diego Garcia and Guam bolster the defensive arc from afar

Along the defensive arc the West spearheaded by the US is urgently positioning a homogeneous anti-missile shield system Some nations prefer to develop their own indigenous systems namely Israel Taiwan and South Korea There is no certainty the in-place anti-missile shields will be able to destroy all incoming hostile missiles

To add complexity the oil supply transit conduit bisects the two arcs running as it does from the Strait of Hormuz across the northern Indian Ocean through the Malacca strait into the contested Nan Hai through the Taiwan Strait into the disputed Dong Hai to ultimate destinations in China Japan and South Korea

Oil and missiles are a dangerous volatile mix endangering world peace In WWII the U-boat menace in the Atlantic gave example of the pillage and wanton destructive power of torpedoes able to strike at whim amongst vulnerable lsquositting-duckrsquo oil tanker convoys The missile onslaught in the Oil Tanker War fortunately was not as destructive compared to WWII However it could have been much worse

Missiles may be used as a consequence of conflict starting but other technology and approaches RPVs cyber economic and asymmetric warfare are more likely to be the precursors and seed corn of conflict

ldquoNemesisrdquo an interpretationsymbolic relevance

The declining world economy will surely one day tilt our planet towards a disastrous global war of unforseen dimension

The above noxious ingredients have the potential to destroy our lifestyle within this Century

It has often been said by pundits that the world with an estimated total current population of over six billion destined to grow to as much as nine plus billion in a few decades will no longer be able to sustain its expanding population This will be the planetrsquos true retribution to forever-greedy mankind Nemesis indeed in the so-called Asian Century

Mother Earth will not forgive us for raping our planet In the context of this paper the competing nations of the world are perceived as Mother Earthrsquos delinquent children Humanity is in dire threat of extinction Must we eventually abandon our planet Tomorrow will there be a Chinese penal institution on Mars or will there be a UN contrived free-world colony101

Must mankind always relapse to the past to bring on a future to it which in turn relapses to repeat the past history of world conflicts thus engendering fresh conflicts This is a never ending tragedy for us all101 Robinson Kim Stanley ldquoThe Mars Trilogyrdquo Spectra publisher Archives Fine Books Charlotte street Brisbane Queensland Australia

P a g e | 39

Our progress in the 21st Century is often said to be limited only by our imagination Are we constrained by a straitjacket in the form of the potential for future conflict in a world of ever diminishing resources

Notwithstanding the findings and conclusions expressed above there is a glimmer of hope for mankind lsquoA saviour candle in the dark so to speakrsquo not directly related to discussion in this paper This is seen as too late for the Syrian Crisis It may be hard to believe but according to research due to be published in early 2013 a world without war may be evident this century Professor Haavard Hegre and colleagues at the Peace Research Institute Oslo have advanced a statistical model predicting that global conflict will halve within the next 40 years102

The predictions are based on dynamic multinomial logit model estimation on a 1970-2009 cross-sectional dataset of changes between no armed conflict minor conflict and major conflict Core exogenous predictors are population size infant mortality rates demographic composition education levels oil dependence ethnic changes and neighbourhood characteristics These predictors are somewhat analogous to the critical mass factors explained above

Using this model the Oslo research suggests conflicts in Libya Tajikistan Syria Senegal Senegal Ivory Coast Mauritania and Iraq will probably end in the next five years By 2017 the risk of war will be greatest in India Ethiopia Philippines Uganda and Myanmar By 2050 as the number of countries at war falls from one in six to one in 12 the risk of conflict will be greatest in India Nigeria Sudan Ethiopia and Tanzania

Theoretically it may be possible to substitute pertinent critical mass factors outlined above for some of the core exogenous predictors used in the logit model For example climate change environmental degradation ldquosee-sawrdquo crisis economics geopolitical indices overpopulation resource depletion food and water scarcity and weapons proliferation Essentially oil dependence should be retained perhaps with some of the other original predictors

The logit model could possibly be revised to reflect arbitrary political groupings for the larger powers For instance the Sino-Russian bloc coupled together with lsquosurrogatersquo Iran Syria Sudan Pakistan North Korea and rogue nations Similarly the West grouped together as another bloc comprising ANZAC ASEAN NATO Canada and the US These random choices and groupings could introduce new statistical inferences into the logit model

By doing this the logit model may more closely parallel the global dichotomy perceived between China and the US The so-called ldquoChina-US Equationrdquo ndash undoubtedly the worldrsquos most important relationship It remains to be seen whether the logit model can be pragmatically revised in the manner described If so new predictions for armed conflict from lsquo2010 to 2100rsquo may be closer to the truth

102 Hegre Professor Haavard Department of Political Science Oslo in collaboration with the Peace Research Institute Oslo Forthcoming publication authored by Hegre Haavard Joakim Karlsen Haavard Mokleiv Nygaard Henrik Urdal and Haavard Strand 2013 entitled ldquopredicting Armed Conflict 2011 ndash 2050rdquo to be published in Wiley International Studies Quarterly forthcoming email address haavardhegrestvuiono

P a g e | 39

Our progress in the 21st Century is often said to be limited only by our imagination Are we constrained by a straitjacket in the form of the potential for future conflict in a world of ever diminishing resources

Notwithstanding the findings and conclusions expressed above there is a glimmer of hope for mankind lsquoA saviour candle in the dark so to speakrsquo not directly related to discussion in this paper This is seen as too late for the Syrian Crisis It may be hard to believe but according to research due to be published in early 2013 a world without war may be evident this century Professor Haavard Hegre and colleagues at the Peace Research Institute Oslo have advanced a statistical model predicting that global conflict will halve within the next 40 years102

The predictions are based on dynamic multinomial logit model estimation on a 1970-2009 cross-sectional dataset of changes between no armed conflict minor conflict and major conflict Core exogenous predictors are population size infant mortality rates demographic composition education levels oil dependence ethnic changes and neighbourhood characteristics These predictors are somewhat analogous to the critical mass factors explained above

Using this model the Oslo research suggests conflicts in Libya Tajikistan Syria Senegal Senegal Ivory Coast Mauritania and Iraq will probably end in the next five years By 2017 the risk of war will be greatest in India Ethiopia Philippines Uganda and Myanmar By 2050 as the number of countries at war falls from one in six to one in 12 the risk of conflict will be greatest in India Nigeria Sudan Ethiopia and Tanzania

Theoretically it may be possible to substitute pertinent critical mass factors outlined above for some of the core exogenous predictors used in the logit model For example climate change environmental degradation ldquosee-sawrdquo crisis economics geopolitical indices overpopulation resource depletion food and water scarcity and weapons proliferation Essentially oil dependence should be retained perhaps with some of the other original predictors

The logit model could possibly be revised to reflect arbitrary political groupings for the larger powers For instance the Sino-Russian bloc coupled together with lsquosurrogatersquo Iran Syria Sudan Pakistan North Korea and rogue nations Similarly the West grouped together as another bloc comprising ANZAC ASEAN NATO Canada and the US These random choices and groupings could introduce new statistical inferences into the logit model

By doing this the logit model may more closely parallel the global dichotomy perceived between China and the US The so-called ldquoChina-US Equationrdquo ndash undoubtedly the worldrsquos most important relationship It remains to be seen whether the logit model can be pragmatically revised in the manner described If so new predictions for armed conflict from lsquo2010 to 2100rsquo may be closer to the truth

102 Hegre Professor Haavard Department of Political Science Oslo in collaboration with the Peace Research Institute Oslo Forthcoming publication authored by Hegre Haavard Joakim Karlsen Haavard Mokleiv Nygaard Henrik Urdal and Haavard Strand 2013 entitled ldquopredicting Armed Conflict 2011 ndash 2050rdquo to be published in Wiley International Studies Quarterly forthcoming email address haavardhegrestvuiono

P a g e | 40

Peacemaker Ombudsman and role of the United Nations

In the interests of world peace both sides should deescalate their respective military build-ups retract and stand down missile deployments destroy WMD invoke mutual trust and seek to improve the symbiotic trade opportunities for greater wealth particularly evolving from the China-US Equation

It appears there is no one person persons political lobby group independent institute government or nation capable of successfully promoting this vital task A truly effective Peacemaker Ombudsman responsible as lsquothe guardian of world peacersquo is yet to be appointed The task may well be impossible for one person as perhaps demonstrated by successive Secretary-Generals of the United Nations (UN) in the past There must be a better way Research work to promote world peace conducted by many independent institutes around the world such as the UN Stockholm International Peace Research Institute (SIPRI) the Carnegie Endowment for International Peace TES Strategic Peace and International Affairs Research Institute (SPIRIT) Chatham House and others still requires integration and cooperation under the aegis of a new effective global entity Many attempts have been made to create such an entity

Sophie Crockett political analyst considers the UN to be the most widely represented institution103 To quote ldquoThe UN currently has 192 member states which means every sovereign country in the world is affiliated to it thus making it the most widely represented institution to examine (Archer 2001 25)rdquo104 Crockett concludes the UN is essentially flawed even though without it peace would not have reigned in several countries Crockett states ldquo the UN still hold great potential and are held in high regard by the international community little confidence can be held that in the future international institutions will lead the way to world peacerdquo Today the UN has 193 member states (one new member)

United Nations Reform Proposals

One way ahead could be to reform the UN On the UN Web site attention is drawn to the continuous process of renewal including change and reform 105

To quote from the UN Web site ldquoThe world is changing and with it the demands on the United Nations The UN provides a unique platform for international action It offers unparalleled legitimacy for global engagement owing to its universal membership its inclusive decision-making processes its unequalled reach and its ability to provide critical services that are essential to international peace security stability and prosperityrdquo

Since its founding there have been many calls for reform of the UN These calls are comprehensively documented on the Internet106 The UN must embrace change It cannot remain an archaic and inflexible organisation oblivious to world power shifts 103 Crockett Sophie ldquoCan international institutions help make the world more peacefulrdquo Royal Holloway University of London 22 March 2011104 Archer Clive ldquoInternational Organisations Third Editionrdquo Routledge 2001105 UN Web site Home Page click on lsquoStrengthening the UNrsquo access ldquoWelcome to the United Nations Itrsquos your worldrdquo wwwunorgen accessed 10 February 2013

P a g e | 41

The 1920rsquos and the immediate post WWII period belong to different ages History is no longer relevant ndash the future is here and the UN must be prepared to meet it

One important new reform for consideration could be the composition of the permanent members of the UN Security Council (UNSC) Currently there are five permanent members the Peoplersquos Republic of China France the Russian Federation the United Kingdom and the US

All five member nations with permanent seats on the UNSC have operational long-range ballistic missile systems including ICBM All have submarine-launched missiles (SLBM) China Russia and the US also have land-based ICBMs China and Russia have both silo and road-mobile missiles The USrsquo missiles are silo-based

Indiarsquos rapidly expanding economy is likely to overtake China by 2020 or earlier India is currently a non-permanent member of the UNSC India has ICBM capability Brazil is also emerging as a very powerful economy but is not a member of the UNSC Brazil does not have ICBM capability Reference can be made to the so-called emerging lsquoBRICrsquo economies107 The European Economic Union (EEU) now represents the majority of the European countries including economic powerhouse Germany

With these major power shifts and economic changes in mind it is suggested India Brazil and the EEU generic-entity could become new permanent members of the UNSC As France and the UK already belong to the EEU there is no need for them to continue as individual permanent members of the UNSC

If this reform is adopted the new composition of the UNSC will be Brazil EEU India Peoplersquos Republic of China (PRC) the Russian Federation and the United States Permanent membership would increase to six members It is questionable whether the EEU is acceptable If not France and the UK could retain their permanent membership The UNSC would then comprise seven permanent members

Germany would then complain and ask for inclusion So the membership of the UNSC would possibly increase to eight permanent members It is difficult to resolve this The EEU inclusion should be preferable

A further consideration for reform could be Article 27 of the UN Charter in respect of the use of veto power From 1946 to 2008 vetoes were used on 261 occasions In the 21st Century neither France nor the UK has exercised their veto power The most recent vetoes appropriate to this research paper include (1) China and Russia vetoed a resolution threatening Chapter 7 sanctions against Syria 19 July 2012 and (2) the US vetoed a draft resolution condemning Israeli settlements in the West Bank 18 February 2011 These vetoes relate to the Middle East

106 See ldquoUnited Nations ndash Wikipedia the free encyclopediardquo Reform and Criticism Page 9 including linkages to main article Reform of the United Nations and Criticism of the United Nations accessed httpenwikipediaorgwikiUnited_Nations 10 February 2013107 The new emerging economies are Brazil Russia India and China These are the so-called BRIC economiesNamed by Goldman Sachs in the late 1990rsquos

P a g e | 42

Veto power within the UNSC whilst effective as a lsquosafeguardrsquo both to the Sino-Russian bloc and the West can often blunt initiatives to halt regional conflicts and to consequently inhibit real prospects for world peace

The old maxim so often stated lsquothe UN is a toothless tigerrsquo will still apply unless major reforms are implemented to the UN Charter to the composition of the UNSC and to overcoming the inadequacies of restrictive veto power

Former Chinese President Hu Jintao asserted ldquoMultipolarity constitutes an important base for world peace and the democratization of international relations is an lsquoessential guaranteersquo for that peacerdquo108 Hu went on to say ldquoIssues concerning global and regional peace should be resolved through consultations based on the UN Charter and universal normsrdquo

It is difficult to see how consultations can be resolved without substantial reform to the UN Charter as it is now constituted

Conclusion overall summary statement

It may be said that the continuing scramble for sustained oilgas supply to oil-thirsty nations prevailing logistics geopolitical impasse over disputed energy reserves propensity for localisedlimited theatre military confrontations and the proliferation of hostile missiles along the eastward lsquooil umbilicalrsquo could indeed one day trigger global conflict of immense proportions

Past history has often demonstrated the tyranny of oil supply

If this worst case scenario eventuates what impact will this have on the westward lsquooil umbilicalrsquo and the remainder of oil production for the world

The ever present political power struggle between the Sino-Russian block and the West will serve to accentuate the problem

David L O Hayward Word Count 20952 words 3 June 2013

CAPT David L O Hayward (Rtd) Intern ldquoThe Intelligence Community LLCrdquoChina Research Team Queensland Washington DC USA ChinaResearchTeamgmailcom wwwTheIntelligenceCommunitycom

Associate Future Directions Intl Member Desborough House Perth Royal United Services Institute (RUSI) Inc WA Australia Queensland Australia wwwfuturedirectionsorgau wwwrusiorgau

Acknowledgements

108 Jintao Hu Chinese Vice President ldquoMultipolarity Plays Key Role in World Peacerdquo address to the French International Relations Institute Paris France 6 November 2001

P a g e | 43

Alan and Maxine Baker Libor Benes Dr John Bruni GPCAPT Maurice Dixon (Rtd) Commander Dimitrios Dalaklis PhD Patricia Hayward RUSI Queensland members China Research Team and voluntary contributors who wish to remain anonymous

AcronymsABM Anti-ballistic missile (designed to counter incoming strike missiles)ASBM Anti Ship Ballistic missileASCM Anti SubShip Cruise MissileASEAN Association of Southeast Asian NationsASRY Arab Shipbuilding and Repair Yard (Bahrain)AWACS Airborne Warning and Control SystemBRBM Battlefield Range Ballistic MissileCNOOC China National Offshore Oil CorporationCNPC China National Petroleum CorporationDRDO Defence Research and Development Organisation (New Delhi)EEZ 200-Mile Exclusive Economic ZoneEIA US Energy Information AdministrationEKV Exo-atmospheric Kill Vehicle (class of ABM)GDP Gross Domestic ProductIMF International Monetary FundINS Indian Navy Support (INS Kadamba Naval Base near Karwar)ICBM Intercontinental Ballistic MissileIRGCN Islamic Revolutionary Guard Corps Navy (coastal defence force)IRBM Intermediate Range Ballistic MissileIRIN Islamic Republic of Iran Navy (ldquoblue water navyrdquo)ISTAR Intelligence Surveillance Target Acquisition and ReconnaissanceLACM Land Attack Cruise MissileLRTR Long Range Tracking RadarMMbblday Millions of barrels of oil per dayMRBM Medium Range Ballistic MissileNOSI Naval open Source Intelligence (wwwnosiorg)NSA Naval Support Activity (US Naval Base Bahrain) OPV Offshore Patrol VesselRPV Remotely piloted vehicleRSAF Royal Saudi Air ForceSIPRI Stockholm International Peace Research InstituteSRBM Short Range Ballistic MissileSUMED lsquoSuez-Mediterraneanrsquo dualised relief oil pipeline operated by Arab Petroleum Pipelines Company ULCC Ultra Large Crude Carrier (oil tanker)VLCC Very Large Crude Carrier (oil tanker)UNCLOS UN Convention on the Law of the SeaUSAF United States Air ForceWMD Weapons of Mass Destruction

Notes

P a g e | 44

The findings views and opinions expressed in this research paper by the author do not represent those of The Intelligence Community LLC Australian Department of Defence (DOD) American Foreign Policy Council (AFPC) US Department of Defense Future Directions International (FDI) Royal United Service Institute (RUSI) Queensland Inc EIA or of any other government agency ldquoThink Tankrdquo academic institution andor independent institute in Australiaoverseas

Apologies are made for any omissions or technical inaccuracies Oil consumption statistics (latest available) are quoted in millions of barrels of oil per day (MMbblday) All Internet sources are quoted where relevant in this paper

Supportive background research papers have been postedpublishedarchived in one form or another to at least eight or nine Web sites worldwide These Web sites include IAGS (Potomac) FDI (Perth) GERN-CNRS (France) RUSI (Canberra) Sage International (Adelaide) Swiss ISN Metadatabase (Zurich) two Chinese Web sites in Shanghai (in Mandarin and English) and TRUNG QUOC (Vietnam)

These Web sites can be accessed by Google search using research paper titles such as ldquoChinarsquos Dependence upon Oil Supplyrdquo (45000-word RUSI defence research paper) andor ldquoChina in the Indian Ocean A Case of Uncharted Watersrdquo (5000-word FDI strategic analysis paper) Alternatively the pertinent Web sites can be accessed by searching on the full name and military rank of the above author

END Document 3 June 2013

P a g e | 44

The findings views and opinions expressed in this research paper by the author do not represent those of The Intelligence Community LLC Australian Department of Defence (DOD) American Foreign Policy Council (AFPC) US Department of Defense Future Directions International (FDI) Royal United Service Institute (RUSI) Queensland Inc EIA or of any other government agency ldquoThink Tankrdquo academic institution andor independent institute in Australiaoverseas

Apologies are made for any omissions or technical inaccuracies Oil consumption statistics (latest available) are quoted in millions of barrels of oil per day (MMbblday) All Internet sources are quoted where relevant in this paper

Supportive background research papers have been postedpublishedarchived in one form or another to at least eight or nine Web sites worldwide These Web sites include IAGS (Potomac) FDI (Perth) GERN-CNRS (France) RUSI (Canberra) Sage International (Adelaide) Swiss ISN Metadatabase (Zurich) two Chinese Web sites in Shanghai (in Mandarin and English) and TRUNG QUOC (Vietnam)

These Web sites can be accessed by Google search using research paper titles such as ldquoChinarsquos Dependence upon Oil Supplyrdquo (45000-word RUSI defence research paper) andor ldquoChina in the Indian Ocean A Case of Uncharted Watersrdquo (5000-word FDI strategic analysis paper) Alternatively the pertinent Web sites can be accessed by searching on the full name and military rank of the above author

END Document 3 June 2013