Archive for the ‘Saudi Arabia’ Category

A leaner, more aggressive shale oil retakes market share from OPEC

March 21, 2017

High oil prices at around $100/barrel fueled the first shale oil boom in the US. Drilling rigs proliferated and the ensuing oil glut led to the sharp drop of price in 2015. Saudi Arabia then started a price war for a variety of reasons:

  1. to attack the shale oil industry (and take away the market share they had won),
  2. to hurt Iran whose return to the international oil market was imminent, and
  3. to hurt Russia because of the vulnerability of their budget to oil revenues

But most importantly they wished to attack the shale oil industry which was thought to have its Achilles heel in its relatively high production cost. With Saudi Arabian production cost at around $3/barrel, even a long period at low oil prices was considered a critical advantage. The strategy backfired and Saudi was forced to participate in OPEC’s production cuts to prop up the oil price. But even that action is now backfiring as the shale oil industry has emerged leaner and meaner and is now ramping up production again. Last week the oil price dropped some 10% as shale oil now retakes some of the market share it had lost.

The glut continues and we are unlikely to see prices much above $50-60/barrel for the next 2 or 3 years. The Saudi attacks have only helped shale oil to reduce its own costs dramatically. They are far less vulnerable to attack now than in 2015. At that time they needed an oil price of around $80 to make any reasonable profit. Now they are so much leaner that they are viable at oil prices even as low as $40/barrel (and some wells are now rivaling the Saudi production costs).

Oil Wars

Has OPEC Underestimated U.S. Shale Once Again?

The U.S. shale cowboys are back on their horses and leading a strong recovery in the oil patch that is not expected to falter even as WTI prices dropped last week below $50 per barrel for the first time in more than two months.

With lessons learned from the oil price crash and budgets streamlined and focused on the most prolific shale plays, U.S. drillers are giving OPEC a hard time by raising output and hedging future production. Meanwhile, the cartel members are trying to cut supply and fix the price of oil at such a range that would allow them to reap higher oil revenues, but not allow the shale patch to recover too much too fast.

Two and a half months into the supply-cut deal, it looks like OPEC is losing the campaign to prop up oil prices. The drop in prices that began last week saw them retreating to almost exactly the same level as on November 30 – just below $52/barrel for Brent – when the OPEC deal was announced, the International Energy Agency said in its monthly report on Wednesday.  

At the same time, reduced breakeven prices in many shale plays and forward locking-in of production is allowing the companies currently drilling in the U.S. to turn in profits even at a price of oil at $40 a barrel. The U.S. shale patch has not only emerged leaner and more resilient from the downturn, it has also hedged future production with contracts guaranteeing the price of the crude they will be pumping a year or two from now, Bloomberg reports, citing industry executives and analysts.

This is a sign that OPEC may have underestimated—yet again—the resilience of the U.S. shale patch when the cartel decided to collectively curtail oil supply.

Last week Saudi officials told American oil producers that there would be “no free rides” and that they should not expect OPEC to extend or deepen the output cuts to make up for the jump in shale production in the U.S.

And U.S. shale output has been steadily growing in the past few months, thanks to, and quite ironically so, OPEC’s cuts that have been supporting WTI prices at above $50 (or at least above $48 this past week). The U.S. shale patch is expected to lift its April oil output by 109,000 bpd, the EIA said earlier this week.


Is Saudi Arabia giving up on its oil wars?

September 29, 2016

There is a faint whiff of realism entering into Saudi Arabian government policy. They have started to curb public expenditure, they have flagged salary cuts for public employees (not just now but in 2 years), they are desperately trying to diversify their economy. Much of the change has been forced due to self-inflicted collateral damage to their various “oil wars” against shale oil, against Iranian oil and against Russian oil. They have tried to use low oil price as a weapon in their political and ideological battles. But Saudi Arabia has not yet developed the capabilities (and competence) among its indigenous work force to cope without the fat cushion of oil revenues. Without foreign competence and labour, Saudi would collapse and the only thing keeping the foreign competence and labour there is oil money.

It may be a faint hint of an increasing pragmatism that for the first time in 8 years the Saudis and OPEC have agreed to a modest cut in oil production.

It is not the end of the  oil wars but it may be the beginning of the end.


OPEC agreed on Wednesday modest oil output cuts in the first such deal since 2008, with the group’s leader Saudi Arabia softening its stance on arch-rival Iran amid mounting pressure from low oil prices.

“OPEC made an exceptional decision today … After two and a half years, OPEC reached consensus to manage the market,” said Iranian Oil Minister Bijan Zanganeh, who had repeatedly clashed with Saudi Arabia during previous meetings.

He and other ministers said the Organization of the Petroleum Exporting Countries would reduce output to a range of 32.5-33.0 million barrels per day. OPEC estimates its current output at 33.24 million bpd.

“We have decided to decrease the production around 700,000 bpd,” Zanganeh said.

The move would effectively re-establish OPEC production ceilings abandoned a year ago.

However, how much each country will produce is to be decided at the next formal OPEC meeting in November, when an invitation to join cuts could also be extended to non-OPEC countries such as Russia.

Oil prices jumped more than 5 percent to trade above $48 per barrel as of 2015 GMT. Many traders said they were impressed OPEC had managed to reach a compromise after years of wrangling but others said they wanted to see the details.

“This is the first OPEC deal in eight years! The cartel proved that it still matters even in the age of shale! This is the end of the ‘production war’ and OPEC claims victory,” said Phil Flynn, senior energy analyst at Price Futures Group. 

Jeff Quigley, director of energy markets at Houston-based Stratas Advisors, said the market had yet to discover who would produce what: “I want to hear from the mouth of the Iranian oil minister that he’s not going to go back to pre-sanction levels. For the Saudis, it just goes against the conventional wisdom of what they’ve been saying.”.

Saudi Energy Minister Khalid al-Falih said on Tuesday that Iran, Nigeria and Libya would be allowed to produce “at maximum levels that make sense” as part of any output limits.

That represents a strategy shift for Riyadh, which had said it would reduce output to ease a global glut only if every other OPEC and non-OPEC producer followed suit. Iran has argued it should be exempt from such limits as its production recovers after the lifting of EU sanctions earlier this year.

…….. Saudi Arabia is by far the largest OPEC producer with output of more than 10.7 million bpd, on par with Russia and the United States. Together, the three largest global producers extract a third of the world’s oil.

Iran’s production has been stagnant at 3.6 million bpd in the past three months, close to pre-sanctions levels although Tehran says it wants to ramp up output to more than 4 million bpd when foreign investments in its fields kick in. … Saudi oil revenue has halved over the past two years, forcing Riyadh to liquidate billions of dollars of overseas assets every month to pay bills and cut domestic fuel and utility subsidies last year.

It may even be that the Iranians and the Saudis are actually talking to each other.

Opec Countries (image

Opec Countries (image


Obama caves to Saudi pressure (what else?)

April 19, 2016

It was only to be expected.

Saudi Arabia did not like proposed legislation which would have allowed the government of Saudi Arabia to be sued in US courts for possible 9/11 involvement and would, in turn, have allowed US courts to attach Saudi accounts and assets in the US. So they made some threats of selling off their US assets. And the President of the United States, in good democratic style, caved in to the demands of a dictator. President Obama wasted no time in telling the legislators that he would veto any such legislation.

The HillThe White House on Monday signaled President Obama would veto legislation to allow Americans to sue the government of Saudi Arabia for any role officials played in the Sept. 11, 2001, terror attacks. ……

The legislation drew widespread attention after Saudi officials reportedly informed the Obama administration that they would sell off $750 billion in U.S. assets if the bill became law, a threat that carries widespread economic consequences if the Saudis follow through.

Earnest appeared to strongly caution the Saudi government against taking such a step.

“A country with a modern and large economy like Saudi Arabia would not benefit from a destabilized global financial market, and neither would the United States,” he said.

The fierce debate over the legislation has bubbled up at a precarious time for Obama, who is set to land in Saudi Arabia on Wednesday to meet with King Salman.


Saudi Prince royally renditioned from Paris?

March 29, 2016

Strange goings on in the Kingdom. Prince Sultan bin Turki, (who is suing the Saudi government for being kidnapped in 2003) boarded a plane in Paris bound for Cairo, but didn’t arrive. It seems he may have been whisked off to Saudi Arabia. Saudi princes wouldn’t normally interest me greatly but he “is the third Saudi prince seemingly to go missing in suspicious circumstances in the last year”.

The US has made the practice of extraordinary renditions a regular and allowable action against its perceived enemies. Saudi Arabia, it seems, favours royal renditions. The orders may have come from King Salman but are more likely to have come from his son, Deputy Crown Prince Mohammad bin Salman Al Saud, who is also the power behind the throne

…. the BND, the German intelligence agency … portrayed Saudi defence minister and Deputy Crown Prince Mohammed bin Salman … as a political gambler who is destabilising the Arab world through proxy wars in Yemen and Syria. – Wikipedia

The royal dungeons must be filling up.

The Guardian:

Staff working for a Saudi prince involved in high-profile legal proceedings against the Saudi government claim he has been taken to Saudi Arabia from Europe against his will.

Prince Sultan bin Turki, who has elaborate 24-hour protection, brought legal action in Switzerland against the Saudi government over a kidnapping in 2003, which he says left him with serious, ongoing medical problems.

On 1 February he and his entourage boarded a Saudi plane in Paris ostensibly bound for Cairo, where he had made plans to visit friends and his father, the Saudi king’s elder brother, who lives there. His aide made reservations at the Kempinski Hotel in Cairo’s Garden City district. But he never arrived.

“There was a Saudi plane with a flight plan to Cairo but the plane did not fly to Cairo,” said an associate of the prince who was with him in Paris. “This airplane had a Saudi flag on the tail. This plane came from the Kingdom.”

The Guardian concludes

Saudi Arabia has long had problems managing disaffected royal family members. In 1975 King Faisal was assassinated by a disaffected prince, but until now there have been no claims that the kingdom might have a concerted campaign targeting defectors and dissidents.

Attempts to contact the three princes directly and members of their entourage received no response. The Saudi government and Moroccan authorities did not reply to requests to comment.


Six months of Russian intervention shows up 5 years of Obama’s ineptitude in Syria

March 13, 2016

Russia began its current intervention in Syria on September 30th last year, whereas the US began its anti-Assad campaign in 2011:

……… with the financing, training and encouragement of selected “moderate rebels”. They have no doubt weakened Assad but have also been instrumental in creating ISIS.

The Russian intervention has had a focus and an end-game in mind, both of which were missing from the US/NATO “strategy”. The “ceasefire” that is currently in place allows Russia (and Assad) to continue operating against the “terrorists” (ISIS, Al Nusra…) who are not party to the ceasefire. The US is now just following Russia’s lead much to the chagrin of the many Sunni opposition groups and of Saudi Arabia.

The only objective which Obama and Kerry ever had in Syria was to remove Assad but they had no strategy either for that or for what would follow. In Syria, Vladimir Putin has highlighted Obama’s ineptitude.

Canada Free Press:

On February 27, 2016, a ceasefire went into effect in Syria between the forces of the Assad regime and the opposition. The ceasefire was achieved after the United States and Russia reached understandings regarding the terms of the agreement; Bashar al-Assad and the representatives of the opposition who took part in the contacts accepted its terms; and the ceasefire was grounded in a UN Security Council resolution.

The Islamic State, Jabhat al-Nusra, and other jihadist rebel groups are not party to the ceasefire, and Russia and the United States have agreed that they would continue fighting them in cooperation with one another. In actuality, the ceasefire was reached as a result of the combined efforts of the two superpowers currently engaged in leading the campaign for a political solution to the Syrian crisis. All the other actors are dependent on the assistance of these two powers and are subject to their influence.

In order to translate its military achievements in the Syrian arena into achievements in the realm of international politics, Russia worked intensively to advance the ceasefire along two parallel channels. The first channel was operational – specifically, a joint air and ground offensive against rebel forces aimed at exhausting them, carried out by a pro-Assad coalition including Iran, Syrian military forces that are loyal to Assad, Hezbollah, and Shiite militias. The severe damage sustained by the rebel forces is what brought them to the negotiating table. The second channel focused on advancing a political process, primarily vis-à-vis the United States, but also Saudi Arabia.

Moscow sought to promote the political dialogue while it enjoyed the upper hand on the military battlefield and was able to dictate the outcome of the process. Russia translated its achievements on the ground into a political roadmap for a cessation of hostilities and the establishment of a transitional period toward a solution to the conflict within 18 months. Russian policy with regard to the Syrian crisis was also motivated by Russia’s aspiration to promote its standing within the international arena and reduce the Western foreign and economic pressure leveled against it following its actions in Ukraine. In this context, Moscow led the joint offensive of the forces of the pro-Assad coalition in an effort to demonstrate its determination and to create pressure on the West and on Turkey by means of a massive flight of refugees toward Turkey from the embattled areas. It is unclear whether Russia received anything in return from the contacts that took place behind the scenes between Washington and Moscow, such as an easing of the Western sanctions.

Syria conflict map 13th March 2016 Carter Center

Syria conflict map 13th March 2016 Carter Center

The Russian intervention has seen the ISIS expansion halted and reversed. They have secured breathing space for the Assad regime though they expect to have him replaced in an orderly manner in time. ISIS will shift (is already shifting) to Libya which is in chaos (for which Obama passes the buck to Cameron and Sarkozy). The EU with its shambles of a refugee policy is providing the sink which swallows the bulk of those displaced.

The real Middle East end-game is a very long way away but Russia is reaching its immediate objectives of supporting the Syrian regime, halting the march of Sunni- groups, restraining the ambitions of Saudi Arabia and of getting in the good books of Iran.

The US and Europe will still have to handle ISIS in Libya but here they will not have the Russians to rescue them.


Saudi Arabia seeks bank loans for first time in a decade

March 9, 2016

I am still of the opinion that the oil price war that Saudi Arabia has been waging against shale oil, Russia and Iran, was misguided and due primarily to a geopolitical machismo that was grossly overestimated. It was misguided because shale fracking is not a technology that is going to go away. In the short term some of the more expensive shale wells may close, but they can very soon start up again. But more importantly, shale gas and oil are available all over the world. They just haven’t been developed yet. And those that don’t have access to shale – like Japan – will have access to gas from methane hydrates within a decade. And there is more gas available from methane hydrate than from shale which, in turn, is more gas than all the natural gas resources known.

In the long run I expect the Saudis to be the losers. Their budget deficit climbed to approach $100 billion last year and now, for the first time in a decade, they are looking to borrow.


Saudi Arabia is seeking a bank loan of between $6 billion and $8 billion, sources familiar with the matter told Reuters, in what would be the first significant foreign borrowing by the kingdom’s government for over a decade.

Riyadh has asked lenders to submit proposals to extend it a five-year U.S. dollar loan of that size, with an option to increase it, the sources said, to help plug a record budget deficit caused by low oil prices.

The sources declined to be named because the matter is not public. …

The kingdom’s budget deficit reached nearly $100 billion last year. The government is currently bridging the gap by drawing down its massive store of foreign assets and issuing domestic bonds. But the assets will only last a few more years at their current rate of decline, while the bond issues have started to strain liquidity in the banking system. …….. 

…… Analysts say sovereign borrowing by the six wealthy Gulf Arab oil exporters could total $20 billion or more in 2016 – a big shift from years past, when the region had a surfeit of funds and was lending to the rest of the world.

All of the six states have either launched borrowing programs in response to low oil prices or are laying plans to do so. With money becoming scarcer at home, Gulf companies are also expected to borrow more from abroad.

In mid-February, Standard & Poor’s cut Saudi Arabia’s long-term sovereign credit rating by two notches to A-minus. The world’s other two major rating agencies still have much higher assessments of Riyadh, but last week Moody’s Investors Service put Saudi Arabia on review for a possible downgrade. ……. 

The pricing of the loan is likely to be benchmarked against international loans taken out by the governments of Qatar and Oman in the last few months, according to bankers. Because of banks’ concern about the Gulf region’s ability to cope with an era of cheap oil, those two loans took considerable time to arrange and the pricing was raised during that period.

Oman’s $1 billion loan was ultimately priced at 120 basis points over the London interbank offered rate (Libor), while Qatar’s $5.5 billion loan was priced at 110 bps over, with both concluded in January.


Saudi Arabia undermines Vienna peace process by holding conference of Sunni, anti-Assad groups

December 8, 2015

It is called a “Peace Conference”. It is being hosted and held by Saudi Arabia and only Sunni groups are invited. The Kurds are not invited and, of course, there isn’t a Shia in sight. The Sunni groups include those who are allied with Al Qaida and members of the Fee Syrian Army and including groups within the FSA which do channel funds and weapons to ISIS. The theory that ISIS and Al Qaida are not present is a fantasy. The intention is to unify the anti-Assad, Sunni forces.

Suadi is just stirring the waters to ensure that no Russian/Assad/Iran end-game can easily succeed.

Iran is not amused.

David Cameron is gratified because if he counts all these disparate groups together, and adds in the Kurds and maybe a few hundred Turkmen also, he might get to a number which is the same order of magnitude as 70,000 “boots on the ground”. (i.e. >7,000 and < 700,000).

NewsweekA Syrian opposition meeting due to begin in Saudi Arabia on Tuesday marks the most serious effort yet to unify President Bashar al-Assad’s fragmented enemies, a step seen as vital to peace talks sought by world powers but which has riled Iran.

While the outlook for the political track recently launched in Vienna appears bleak – international divisions over Assad persist and the war in Syria has escalated – the Riyadh meeting offers the prospect of forging a more united opposition better able to negotiate with the government. …….. 

The participants invited to Riyadh include powerful Islamist factions Islam Army and Ahrar al-Sham – a group whose founders had links to al Qaeda. Ahrar al-Sham still fights alongside the Nusra Front, al Qaeda’s Syrian wing, while espousing a nationalist agenda.

Islam Army said in a statement that its commander, Zahran Alloush, would not attend because the group had lost control of the road he had been planning to use to exit the area in the Damascus suburbs where the group is based. Members of Islam Army’s political office will attend instead, it said.

A dozen Free Syrian Army rebel groups will also attend, including groups vetted by the United States that have received foreign military aid. They include recipients of U.S.-made anti-tank missiles supplied to rebels in larger quantities since Russia intervened militarily on Assad’s side on Sept. 30.

A Saudi end-game which has all these Sunni groups assuming power can only lead to the dissolution of Syria (and maybe that is a good thing). But it will also lead to a break up of Iraq. It will establish a Kurdistan, a Shia- ruled territory and a desperately fractured Sunni area with a bunch of squabbling groups.

And ISIS will still be around.

The inspiration for Da’esh comes from Saudi Arabia

November 28, 2015

Saudi Arabia is the current Chairman of the UN Human Rights Council.

Believe it or not.

And Saudi Arabia is proving to be the role-model for the region.

A 45 year old Sri Lankan married woman, working as a maid in Saudi Arabia has been found guilty of adultery with another Sri Lankan man and has been sentenced to death by stoning. He, in true keeping with the Saudi tradition of equitable treatment, has been sentenced to receive 100 lashes.

The Saudis are also planning a mass execution of 52 “terrorists” and under this guise have included a few Shia in their execution list. They too have been convicted of “terrorism” because they demonstrated for  human rights.

Of course Saudi Arabia has the “right” to be as barbaric as it wishes to be in its sovereign territory. Naturally it would be unthinkable for other “sovereign” nations to interfere with their behaviour. And if other nations choose to allow distinguished members of Saudi society to behave with impunity even in their own countries, that is surely their sovereign “right”. And if Saudi Arabia then allows such friendly nations advantageous oil deals and buys weapons at inflated prices from them, it is clearly not the business of anybody else. And what is wrong then if workers from developing countries freely enter into contracts of slavery with Saudi Arabian masters. These workers are very well aware that the job description of “maid” includes full sexual exploitation rights for the master/employer.

It is not so surprising, as far as barbarism, oil deals and weapons purchases are concerned, that the inspiration and example for Da’esh (ISIS) lies rooted deep in the traditions of, and current practices in, Saudi Arabia. Saudi Arabia may theoretically be a part of the coalition against the Islamic State (Da’esh) but this is a political opposition and not an opposition to their methods and practices.

Racism rampant within ISIS (Da’esh)

November 24, 2015

Racism is endemic in the Arab world. Central Asian Muslims at least have the Mongol warrior traditions to give them status. Muslims from S Asia are considered to have been converted by conquerors or by trader-conquerors and are not to be compared with pure-blood Arabs. African Muslims come even lower down the scale since they were slaves who were converted by their Arab masters. In Arab eyes, I think, first class Muslims are those from the Middle East and some selected parts of North Africa; second class are those from countries with a Mongol heritage of being conquerors; third class are those from South Asia and the lowest class are Muslims from sub-Saharan Africa. Generally, the darker the skin colour, the lower the class. (Persians are all of course mainly Shia and are not considered true Muslims).

It has long been suspected that Da’esh (ISIS) also implements a hierarchy of races among their members, over and above any adherence to any religious sect within Islam. Lowest of course are the infidels who follow some religion other than Islam (and worst of all are those who follow no religion at all).  Apostate Sunnis are also considered scum.Then come all Shia Muslims who are virtually infidels.

ISIS just mirrors the racism that is endemic in Saudi Arabia and the Gulf States. African, Indians and Pakistanis who may be Sunni Muslims are never quite completely trustworthy. They are not given positions of command responsibility, are expendable and serve as cannon fodder. That seemingly applies even to European citizens, but who are of S Asian or African origin, and who volunteer as jihadists. That also explains why Boko Haram and al Shabab may affiliate themselves to Da’esh, but Africans are never going to get a place at the top table. Only a true Arab who follows the Wahhabi brand of Salafist jihadism apparently makes the grade. Earlier this year NBC News quoted US intelligence sources about how the Arabs looked down on Africans:

“The Arab world is incredibly racist,” explained a U.S. intelligence official. “They don’t see black Africans as equivalent to them.” ISIS may show “affinity” with Boko Haram, said the official, “but they stop short of allegiance.” Moreover, said the official, while Boko Haram has in the past year released videos to show “affiliation” with groups like ISIS, there’s no evidence of either group sending members to fight with the other. And while Boko Haram has praised ISIS, and shown the ISIS flag in videos, ISIS has not reciprocated.

The Press Trust of India has just put out this story which is carried widely in India, and is apparently based on a report put together from a variety of intelligence sources/briefings.

PTI: …. ISIS does not consider South Asian Muslims, including Indians, good enough to fight in conflict zone of Iraq and Syria and so treats them as inferior to Arab fighters often tricking them into suicide attacks. 

According to an intelligence report prepared by foreign agencies and shared with Indian agencies, fighters from India, Pakistan, Bangladesh as well as certain countries like Nigeria and Sudan are considered inferior to Arab fighters. 

There appears to be clear hierarchy wherein the Arab fighters are preferred as officer cadre and provided better arms and ammunition, equipment, accommodation and salaries. “The fighters from South Asia are usually housed in groups in small barracks and are paid less than the Arab fighters and are provided inferior equipment,” the input says. 

There are reports that the so-called inferior fighters are also, at times, tricked into suicide attacks. Usually they are given a vehicle loaded with explosives and asked to go near a targeted destination and call a certain number, who would purportedly come and meet them to explain the mission. However, as soon as the number is dialled, the car explodes due to a pre-set mechanism aimed at destroying a specific target.

A total of 23 Indians have so far joined the ISIS of which six reportedly killed in different incidents. ….. The intelligence report suggests that there is a disproportionately high level of casualty among the South Asian and African foreign terrorist fighters since they are forced to the frontlines of battle as foot soldiers. The Arab fighters with better battle experience are mostly positioned behind these fighters and hence their casualties are proportionally less in terms of their total numbers. 

According to The Hindu, the intelligence report also says that

“there is information that foreign fighters of Chinese, Indian, Nigerian and Pakistani origin are housed together and are monitored closely by the IS Police. ….  only Tunisian, Palestinian, Saudi Arabian, Iraqi and Syrian are allowed to be in the IS Police force, which is barred for fighters of all other nationalities. 

ISIS considers Islam, as it is practised in India, Pakistan, Bangladesh .., as apostate and a departure from the original teachings of Quran and Hadith, which makes them less motivated towards Salafist Jihad.

Further, passports of foreign terrorist fighters from South Asia and certain African countries are usually burnt upon their arrival in Iraq-Syria to prevent them going back to their countries.

European Muslims of S Asian origin who are attracted to Salafist jihadism because they feel they are second-class in Europe, will now find themselves even lower down the pecking order within Da’esh. The South Asian Muslim women who join Da’esh probably end up as little more than comfort women for their Arab superiors.

Saudi Arabia gets away with it again — but why?

October 21, 2015

That Saudi Arabia uses barbaric, medieval methods within Saudi Arabia is almost a cliche. But why they command an almost fawning behaviour by other countries can only be partly explained by the power of their money. Values, it seems, are subverted by Saudi oil money.

Without financing from parties in Saudi Arabia, ISIS could not sustain itself. The madrassas and mosques where feeble-minded, muslim kids are radicalised in Europe and in Asia, are financed to a large extent from Saudi Arabia. The 9/11 terrorists were mainly Saudis. Bin Laden was Saudi.

Dissolute and decadent Saudi and Gulf tourists run riot in Europe, driving recklessly, drinking heavily, cooking, littering and smoking shisha in public parks. All with an impunity as if they had a de facto diplomatic immunity – which of course they seem to have. Even the Saudi King and an entourage of 1,000 were allowed to take over a whole beach in France in spite of local protests. The French acquiesced to the King’s demand that female police officers be removed.

Saudi Arabia would collapse without its expat workers and foreign labour. Their medieval treatment of foreigners is a scandal but is tolerated because they pay well. How on earth did Saudi Arabia get elected as the Chair of UN Human Rights Council Panel?

In the last few weeks the arrogant and decadent behaviour of the Saudis at home and abroad has been on show.

  1. The incompetence of the Saudi authorities led to the death of at least 2177 people at the Hajj stampede, not the 769 that Saudi Arabia admits to (as if that was not bad enough).
  2. Two Nepali women working as maids for a Saudi diplomat were were held captive by his family and used for “entertainment” for their Saudi friends. They were starved and sexually abused by them and other Saudi guests. When the girls were eventually released and the diplomat charged, he just claimed immunity and was whisked back to Saudi Arabia.
  3. The US authorities allowed a Saudi prince to flee rape charges even though he had no immunity. Majed Abdulaziz Al-Saud was arrested but fled while on bail. “Arrested on suspicion of false imprisonment, sexual assault and battery, a Saudi prince has also recently been accused of attacking at least three women and holding them captive for several days. Immediately upon posting bail, the prince reportedly emptied his $37 million mansion and fled the country on a private jet to avoid civil litigation and criminal charges. …. Although the prince is a royal member of the House of Saud, the U.S. State Department eventually confirmed that Al-Saud does not have any diplomatic immunity”.

Is it just oil money that leads the US and European governments to put up with the atrocious behaviour that would lead to calls for regime change in other countries? Of course the US sees Saudi as a balance for Iran in the region. But if the US is serious about its so-called war on terror, the sources of most of the financing of islamic terror organisations lie in Saudi Arabia. King Salman is showing signs of dementia and the country is actually being run by his son – but not very competently. Mohammed bin Salman is just 29 and has never had experience of being anything more than an aide. The incompetence on show has led to one of the grandsons of the founder of Saudi Arabia making public his concerns about the way the country is being run.

A senior Saudi prince has launched an unprecedented call for change in the country’s leadership, as it faces its biggest challenge in years in the form of war, plummeting oil prices and criticism of its management of Mecca, scene of last week’s hajj tragedy. 

The prince, one of the grandsons of the state’s founder, Abdulaziz Ibn Saud,  ……. (but) who is not named for security reasons, wrote two letters earlier this month calling for the king to be removed.

And all of Europe and the US continue to indulge them. Low oil prices for the next decade will – perhaps – reduce some of the Saudi excesses, but there is something more than just oil money at play.

I suspect it is the delusion in US and Europe that they can manage the inevitable restructuring of nations in the Middle East that must come. At some time Iraq has to split three-ways between Sunni, Shia and Kurd. And now it looks inevitable that Syria must also split in some similar manner, with a Sunni part of Syria perhaps merged with a Sunni part of Iraq.

Ralph Peters’ scenario for the Middle East


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