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virtual nuke. They will be there by June, 2013. If Iran gets the bomb this will make a mockery of US and UN. Lead to copy cats developing nukes — especially KSA. It would be the end of nuclear non-proliferation and significantly increase chance of nuclear event. This is very, very unattractive. We should explore third way between now and end of the year. Diplomatic path would have to be coercive diplomacy. Sanctions are hurting, but we only have 6 months and that is not enough time. Must convince Chinese and Russians of consequences of a military strike. We should allow some (5%) enrichment with inspections. This gives Iran a way out. If none of the above works, US should strike. We could launch a devastating strike (Israel does not have that ability). (nighttime, B-2, deep penetration bombs). First strike should be limited to nuke facilities. US strike will be more effective militarily and narrow the political consequences. Energy and GCC TJP Summary: Write up Meghan O: ME may not be able to supply quantity of energy that people are assuming. 2020-2030 most predictions assume increasing oil supplies from ME. Moving world supply coming from ME from 30 to 38%. Most increase scheduled to come from KSA and Iraq. Are these reasonable assumptions. Oil is there, but politics is problematic. 1. Internal stability is in question. Following a revolution it is very slow to rebuild production; 2. Reinvestment rates will decline. KSA was planning to move from 12.5mm bbl to 15 mm bbl with a $10 bn investment. That has been cancelled in deference to social needs. As there is a push for democracy, the autocrat needs to increase social spending. As population (and joblessness) increae, autocrat needs to increase social spending. Aversion to FDI. We are likely to see supply from ME decline. Iraq and Iran could take up some of the slack. However, we have an American Energy Revolution in play. From 2006 to 2012 we have gone from importing LNG to finding 100 years supply of gas. Shale is also producing oil. Bakkan field has gone from 187k bbl/day to 750k bbl/day in 5 years. By 2020-2030 they exepect Bakkan to produce 1.3 mm bbl/day (same as Libya). Add Gulf of Mex and by 2020 US will be producing 6.7mm bbl/day. Harvard is estimating 11mm bbl/day. Similar situation in Brazil and Mexico. Economic benefits will be great. Political benefits will be there, but we will still have vital interests in ME. 1. Gas won’t substitute for oil; 2. We have other interests in ME (geography, heart of Islamic fundamentalism etc.); 3. Oiulisa global commodity. Disruptions in ME oils supply will affect US; 3. KSA still has 12 HOUSE_OVERSIGHT_025808