United for Peace of Pierce County, WA - We nonviolently oppose the reliance on unilateral military actions rather than cooperative diplomacy.

A "major military exercise" involving "[m]ore than 100 Israeli F-16 and F15 fighters" ended on Jun. 5 "over the eastern Mediterranean and over Greece," the New York Times reported Friday.[1] -- U.S. officials said the exercise "appeared to be an effort to develop the [Israeli] military’s capacity to carry out long-range strikes and to demonstrate the seriousness with which Israel views Iran’s nuclear program," Michael R. Gordon and Eric Schmitt said.[1] -- It was "a clear message to the United States and other countries that Israel was prepared to act militarily if diplomatic efforts to stop Iran from producing bomb-grade uranium continued to falter," Gordon and Schmitt said. -- "The exercise also included Israeli helicopters that could be used to rescue downed pilots. The helicopters and refueling tankers flew more than 900 miles, which is about the same distance between Israel and Iran’s uranium enrichment plant at Natanz, American officials said." -- A remark by an Israeli deputy prime minister that an Israeli attack on Iran was "inevitable" was made, it turns out, "the day after the unpublicized exercise ended." -- Israel, the White House, and the U.S. National Security Council refused to comment on the report, but a senior cleric in Iran said that "Israelis and their U.S. supporters" would be dealt "a heavy blow" if such an attack were carried out, Bloomberg News reported.[2] -- The Wall Street Journal attributed a $4 rise in the price of a barrel of oil to the New York Times report.[3] ...

U.S. SAYS EXERCISE BY ISRAEL SEEMED DIRECTED AT IRAN
By Michael R. Gordon and Eric Schmitt

WASHINGTON -- Israel carried out a major military exercise earlier this month that American officials say appeared to be a rehearsal for a potential bombing attack on Iran’s nuclear facilities.

Several American officials said the Israeli exercise appeared to be an effort to develop the military’s capacity to carry out long-range strikes and to demonstrate the seriousness with which Israel views Iran’s nuclear program.

More than 100 Israeli F-16 and F-15 fighters participated in the maneuvers, which were carried out over the eastern Mediterranean and over Greece during the first week of June, American officials said.

The exercise also included Israeli helicopters that could be used to rescue downed pilots. The helicopters and refueling tankers flew more than 900 miles, which is about the same distance between Israel and Iran’s uranium enrichment plant at Natanz, American officials said.

Israeli officials declined to discuss the details of the exercise. A spokesman for the Israeli military would say only that the country’s air force “regularly trains for various missions in order to confront and meet the challenges posed by the threats facing Israel.”

But the scope of the Israeli exercise virtually guaranteed that it would be noticed by American and other foreign intelligence agencies. A senior Pentagon official who has been briefed on the exercise, and who spoke on condition of anonymity because of the political delicacy of the matter, said the exercise appeared to serve multiple purposes.

One Israeli goal, the Pentagon official said, was to practice flight tactics, aerial refueling, and all other details of a possible strike against Iran’s nuclear installations and its long-range conventional missiles.

A second, the official said, was to send a clear message to the United States and other countries that Israel was prepared to act militarily if diplomatic efforts to stop Iran from producing bomb-grade uranium continued to falter.

“They wanted us to know, they wanted the Europeans to know, and they wanted the Iranians to know,” the Pentagon official said. “There’s a lot of signaling going on at different levels.”

Several American officials said they did not believe that the Israeli government had concluded that it must attack Iran and did not think that such a strike was imminent.

Shaul Mofaz, a former Israeli defense minister who is now a deputy prime minister, warned in a recent interview with the Israeli newspaper *Yediot Aharonot* that Israel might have no choice but to attack. “If Iran continues with its program for developing nuclear weapons, we will attack,” Mr. Mofaz said in the interview published on June 6, the day after the unpublicized exercise ended. “Attacking Iran, in order to stop its nuclear plans, will be unavoidable.”

But Mr. Mofaz was criticized by other Israeli politicians as seeking to enhance his own standing as questions mount about whether the embattled Israeli prime minister, Ehud Olmert, can hang on to power.

Israeli officials have told their American counterparts that Mr. Mofaz’s statement does not represent official policy. But American officials were also told that Israel had prepared plans for striking nuclear targets in Iran and could carry them out if needed.

Iran has shown signs that it is taking the Israeli warnings seriously, by beefing up its air defenses in recent weeks, including increasing air patrols. In one instance, Iran scrambled F-4 jets to double-check an Iraqi civilian flight from Baghdad to Tehran.

“They are clearly nervous about this and have their air defense on guard,” a Bush administration official said of the Iranians.

Any Israeli attack against Iran’s nuclear facilities would confront a number of challenges. Many American experts say they believe that such an attack could delay but not eliminate Iran’s nuclear program. Much of the program’s infrastructure is buried under earth and concrete and installed in long tunnels or hallways, making precise targeting difficult. There is also concern that not all of the facilities have been detected. To inflict maximum damage, multiple attacks might be necessary, which many analysts say is beyond Israel’s ability at this time.

But waiting also entails risks for the Israelis. Israeli officials have repeatedly expressed fears that Iran will soon master the technology it needs to produce substantial quantities of highly enriched uranium for nuclear weapons.

Iran is also taking steps to better defend its nuclear facilities. Two sets of advance Russian-made radar systems were recently delivered to Iran. The radar will enhance Iran’s ability to detect planes flying at low altitude.

Mike McConnell, the director of national intelligence, said in February that Iran was close to acquiring Russian-produced SA-20 surface-to-air missiles. American military officials said that the deployment of such systems would hamper Israel’s attack planning, putting pressure on Israel to act before the missiles are fielded.

For both the United States and Israel, Iran’s nuclear program has been a persistent worry. A National Intelligence Estimate that was issued in December by American intelligence agencies asserted that Iran had suspended work on weapons design in late 2003. The report stated that it was unclear if that work had resumed. It also noted that Iran’s work on uranium enrichment and on missiles, two steps that Iran would need to take to field a nuclear weapon, had continued.

In late May, the International Atomic Energy Agency reported that Iran’s suspected work on nuclear matters was a “matter of serious concern” and that the Iranians owed the agency “substantial explanations.”

Over the past three decades, Israel has carried out two unilateral attacks against suspected nuclear sites in the Middle East. In 1981, Israeli jets conducted a raid against Iraq’s nuclear plant at Osirak after concluding that it was part of Saddam Hussein’s program to develop nuclear weapons. In September [2007], Israeli aircraft bombed a structure in Syria that American officials said housed a nuclear reactor built with the aid of North Korea.

The United States protested the Israeli strike against Iraq in 1981, but its comments in recent months have amounted to an implicit endorsement of the Israeli strike in Syria.

Pentagon officials said that Israel’s air forces usually conducted a major early summer training exercise, often flying over the Mediterranean or training ranges in Turkey where they practice bombing runs and aerial refueling. But the exercise this month involved a larger number of aircraft than had been previously observed, and included a lengthy combat rescue mission.

Much of the planning appears to reflect a commitment by Israel’s military leaders to ensure that its armed forces are adequately equipped and trained, an imperative driven home by the difficulties the Israeli military encountered in its Lebanon operation against Hezbollah.

“They rehearse it, rehearse it, and rehearse it, so if they actually have to do it, they’re ready,” the Pentagon official said. “They’re not taking any options off the table.”

Iran would respond to an Israeli attack on nuclear facilities with a "heavy blow," a senior cleric said, following a New York Times report that Israel carried out an exercise that could prepare it for such a strike.

Ayatollah Ahmad Khatami, leading Friday prayers in Tehran, said today that Iran favored dialogue and would resist "mischievous acts," the state-run Islamic Republic News Agency said. Such an attack would prompt an "uproar on the part of our nation," Khatami said.

"If enemies, especially Israelis and their U.S. supporters, wish to speak in the language of force, they should rest assured they will be dealt a heavy blow on the face by the Iranian nation," the ayatollah said, according to IRNA.

Khatami spoke after the report in today's *Times* that the Israeli military had carried out maneuvers this month over the eastern Mediterranean with more than 100 F-16 and F-15 fighters as well as refueling tankers. Citing unidentified U.S. officials, the report said that the 900-mile (1,450-kilometer) range exercise could be a rehearsal for an attack against the Iranian nuclear plant in Natanz and Iran's long-range conventional missiles.

Iran doesn't recognize Israel and President Mahmoud Ahmadinejad has repeatedly predicted the end of the Jewish state.

The Israel Defense Forces said in a statement that the "Israeli Air Force regularly trains for various missions in order to confront and meet the challenges posed by the threats facing Israel." David Segal, spokesman for the Israeli embassy in Washington, declined to comment further.

"We are not commenting on this one," U.S. National Security Council spokeswoman Kate Starr said. White House spokesman Tony Fratto also declined to comment.

Crude oil rose today following the *Times* report that Israel held a rehearsal for a potential bombing attack on Iranian nuclear targets, and as the weaker dollar enhanced the appeal of commodities as a currency hedge.

The United Nations Security Council has approved three rounds of sanctions against Iran for its failure to halt uranium enrichment, a process used for making fuel for civilian energy or a bomb. The U.S. and European allies accuse Iran of trying to develop a bomb; Iran insists its activities are peaceful and legal under the nuclear Non-Proliferation Treaty.

A task force on Iran policy and U.S.-Israel relations organized by the Washington Institute for Near East Policy said June 16 that Israel may be more inclined to attack Iran because a U.S. intelligence assessment last year eroded support for preventing Iran's government from acquiring a nuclear weapon.

The report, the U.S. National Intelligence Estimate released in December, said Iran stopped its nuclear weapons program in 2003.

Reactions to the NIE "may have heightened the inclination of some Israeli strategists to give further consideration to unilateral military action to forestall Iran's development of a nuclear capability," the task force said.

Iranian Foreign Minister Manouchehr Mottaki said yesterday that Tehran was studying an incentive package to stop enrichment. Still, Iran's Ambassador to the U.N.'s International Atomic Energy Agency, Ali Asghar Soltanieh, said the previous day that Iran won't be pushed into suspending enrichment.

--To contact the reporter on this story: Patrick Donahue in Berlin at at pdonahue1@bloomberg.net.

Crude-oil futures jumped Friday as traders mulled a report hinting at a showdown between Israel and Iran and expressed uncertainty over the impact of an international oil summit in Saudi Arabia this weekend.

Light, sweet crude for July delivery was recently up $3.11, or 2.4%, at $135.04 a barrel on the New York Mercantile Exchange after briefly jumping as high as $136.08. The July contract expires Friday. more actively traded August Nymex crude was up $3.22, or 2.4%, to $135.82 a barrel.

The New York Times reported in Friday's editions that Israel this month carried out an airborne military exercise that American officials say looked like a "rehearsal" for a potential bombing attack on Iran's controversial nuclear facilities.

International tensions over Iran, the second-largest crude producer in the Organization of Petroleum Exporting Countries, have helped rattle the market amid oil's rise of more than 40% this year. Iran also lies on the Strait of Hormuz, a crucial conduit for the export of Gulf crude.

"At the very least it's noteworthy and potentially concerning," said Eric Wittenauer, an energy analyst at Wachovia Securities in St. Louis. "However, at this point in time the imminence of an attack isn't there. Certainly geopolitical tension in the region can prove price-supportive."

The market partly recovered from a fall precipitated Thursday by China's decision to raise the domestic price of gasoline by 17% and diesel by 18%.

"It gave us a one-day selloff," said Walter Zimmermann, an analyst at brokerage ICAP/United Energy in Jersey City, N.J. "It remains to be seen whether that is going to translate into a decrease in demand."

On Sunday, Saudi Arabia has scheduled a summit of major oil producers and consumers. Traders continue to search for clarity over whether the meeting will result in a production boost.

OPEC President Chakib Khelil said Friday that a production increase doesn't make sense.

"To ask the oil producers to increase their output is illogical and irrational," Mr. Khelil told the Algerie Presse Service. Earlier reports have indicated Saudi Arabia, OPEC's de facto leader, will increase output by at least 200,000 barrels a day after the meeting.

Front-month July reformulated gasoline blendstock, or RBOB, rose 5.89 cents, or 1.8% to $3.4115 a gallon. July heating oil rose 9.38 cents, or 2.5%, to $3.8073 a gallon.