You know it must be serious if the French fall into line. French oil giant Total (NYSE:TOT) became the last large Western oil firm to decide to forgo a deal with Iran.
According to a Marketwatch article: " Christophe de Margerie told the Financial Times that it won't invest in a project to develop natural-gas fields in Iran, leaving Iran without the technical know-how to significantly raise its gas exports until late next decade."
This obviously comes as good news as the US urges world leaders in both Europe and China to enforce tough sanctions against the Iranians. The feeling is that if they don't, an Israeli strike on the Iranian nuclear program is inevitable, and that could cause a full-fledged war in the Middle East.
While the other global oil titans were quick in announcing that they will refrain from doing business with Iran, Total basically only did it out of political pressure. The CEO basically reasoned that if they went ahead with the deal, people would say that Total has no principle whatsoever and that they would do anything to make a buck.
I guess as long as the ends justify the means we should applaud the Total position.
Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 7/10/08.
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