The United States Oil Fund and several other oil ETFs (USO, USL) may be benefiting from a report that was out last week highlighting Pentagon approval for a funding request with the following statement:

"The Department has an Urgent Operational Need (UON) for the capability to strike hard and deeply buried targets in high threat environments. The MOP is the weapon of choice to meet the requirements of the UON."

MOP stands for Massive Ordnance Penetrator, a giant bunker buster bomb that may be the only way to destroy buried nuclear facilities in Iran.  The request was for just under 70 million dollars and is mostly described to speed up the completion of the previous program.

Separately, a recent well read article by famed international journalist Robert Fisk pointed out that Saddam Hussein didn’t make it past a few months after deciding to sell oil in Euros.  Iran made a similar decision last month.

A week ago, Iran appeared to have finally made a concession to the international community by agreeing “in principle” to send its low-enriched uranium to Russia and France, to ensure that the material is not further enriched to a point where it can be made into a bomb.

Iran is led by a group of individuals who are widely believed to have manipulated their own country’s recent election and violently put down citizens in opposition to their regime.  It is particularly important to note that the Iranian leaders are considered religious fundamentalists and are untrustworthy according to their own citizens.  That, along with the Iranian president's views on Israel and the Holocaust,  suggests the Iranian regime is just as unreasonable as Saddam Hussein’s government, making successful diplomacy unlikely.

The push to speed up these bombs may suggest, among other things, that the American administration now sees a window of opportunity to strike against a very unpopular government.  Most analysts believe that oil prices would shoot up since Iranian supply would likely be interrupted.