— This is the script of CNBC's news report for China's CCTV on June 17, Tuesday.
Welcome to the CNBC Business Daily.
Rising tensions in Iraq.
Militants belonging to the Islamic state of Iraq and Syria are advancing.
And the US is weighing its options as the highly motivated Sunni militia sets their eyes on Baghdad.
It has started removing staff from its embassy in the Iraqi capital - and is also sending a contingent of military officers and special forces to protect US diplomats... along with an aircraft carrier and three destroyers to the Persian gulf.
The U.S. says it will not rule out air strikes or working with Iran to help support the Iraqi goverment to contain the insurgency.
But Former Defense Secretary William Cohen tells CNBC it's an uphill battle.
[WILLIAM COHEN / Chairman & CEO, The Cohen Group] "I think right now its almost too little too late and i think Iraq is really dissoloved into 3 separate entities such that in the north you have kurds, south sheiq , rest of Iraq is now involved this conflict. I think its gonna be very difficult to bring about the political solution which is the only solution that will have any chance of success."
I will not advocate taking military action unless there is committment to a political resoultion which means a much more inclusive government
But the biggest challenge for the U.S. would be to decide whether to work with Iran in quelling the violence.
Former CIA director James Woolsey was on CNBC a little bit earlier and made pretty controversial remarks about trusting Iran.
[JAMES WOOLSEY / Chairman, Foundation for Defense of Democracies] "I think we need to be very careful about working with the Iranians. Historically, Persians are not known for their commitment to calling it straight. They can be very duplicitous and very disarming while they do it. So I think we need to really watch it in trying to work with them. "
One of the key concerns of course is that the crisis in Iraq could disrupt oil supplies from OPEC's second-largest producer. But so far, Iraqi exports from the terminals in the south have not been affected.
As oil traders take stock of the impact of sectarian violenece in Iraq...
Former National Security Advisor RObert McFarlane explains how this might affect the world energy market.
[ROBERT MCFARLANE / Co-Founder, United States Energy Security Council] "It wouldn't be unusual to see an increase in the range of $20 to $30 a barrel, which of course, in 2008 was sufficient to put the US economy into a recession or a contributing factor to it. "
That wraps up this edition of the Business Daily.
I'm Julia Wood, reporting from CNBC's Asian headquarters.