The 2023 War – ‘Setting the Theatre’

January 13, 2023

Source

Alastair Crooke

The China-Russia axis are lighting the fires of a structural insurrection against the West across much of the Rest of World. Its fires are aimed at ‘boiling the frog slowly’

A top US Marine General, James Bierman, in a recent interview with the Financial Times, explained in a moment of candour how the US is “setting the theatre” for possible war with China, whilst casually admitting as an aside, how US defence planners had been busy inside Ukraine years ago, “earnestly preparing” for war with Russia — even down to the “pre-positioning of supplies”, identifying sites from which the US might operate support, and sustain operations. Simply put, they were there,readying the battle space for years.

No surprise really, as such military responses flow directly from the core US strategic decision to actuate the 1992 ‘WolfowitzDoctrine’ that the US must plan and preemptively act, to disable any potential Great Power — well before it reaches the point at which it can rival or impair US hegemony.

NATO today has progressed to war with Russia in a battlespace, which in 2023, may or may not stay limited to Ukraine. Simply put the point is that the shift to ‘War’ (whether incremental or not) marks a fundamental transition from which there is no going back to ab initio — ‘war economies’ in essence, are structurally different to the ‘normal’ from which the West began, and to which it has grown accustomed over recent decades. A war society — even if only partly mobilised — thinks and acts structurally differently from peacetime society.

War is not about gentlemanly conduct… either. Empathy for others is its first casualty — the latter being a requirement for sustaining a fighting spirit.

Yet, the carefully curated fiction in Europe and the US continues that nothing really has, or will ‘change’: we are in a temporary ‘blip’. That’s all.

Zoltan Pozsar, the influential finance ‘oracle’ at Credit Suisse, has already made the point in his latest War and Peace essay (subscription only) that War is well underway – by simply listing the events of 2022:

• The G7’s financial blockade of Russia (The West setting the battle space)
• Russia’s energy blockade of the EU (Russia begins setting its theatre)
• The U.S.’s technology blockade of China (America pre-positioning of sites to sustain operations)
• China’s naval blockade of Taiwan, (China demonstrating preparedness)
• The U.S.’s “blockade” of the EU’s EV sector with the Inflation Reduction Act. (The US defence planners preparing for future ‘supply-lines)
• China’s “pincer movement” around all of OPEC+ with the growing trend of invoicing oil and gas sales in renminbi. (The Russia-China ‘Commodity Battlespace’).

This list amounts to one major geo-political ‘upset’ occurring, on average, every two months — moving the world decisively away from the so-called ‘normal’ (for which so many in the Consuming Class ardently yearn) to an intermediate state of War.

Pozsar’s list shows that the tectonic plates of geo-politics are seriously ‘on the move’ — shifts, which are accelerating and becoming ever more intertwined, yet that still remain far from arriving at any settled place. ‘War’ will likely be a major disruptor (at the very least), until some equilibrium is established. And that may take some years.

Ultimately, ‘War’ does make its impact on the conventional public mindset — albeit slowly. It seems to be fear of the impact on an unprepared mindset that is behind the decision to prolong Ukraine’s suffering, and thus trigger the War of 2023: An admission of failure in Ukraine is seen to risk spooking volatile western markets (i.e. higher interest rates for longer). And frank-talking represents a hard option for a western world — used to ‘easy decisions’, and ‘can kicking’ — to take.

Pozsar, being a finance guru, understandably is focussed in his essay on finance. But conceivably, the reference to Kindleberger’s Manias, Panics and Crashes is therefore not whimsical, but included as a hint to the possible ‘hit’ to the conventional psyche.

In any event, Pozsar leaves us four key economic takeaways (with brief comments added):

1. War is history’s principle driver of inflation, and the bankruptcy for states. (Comment: war-driven inflation and Quantitative Tightening (QT) enacted to fight inflation, are policies working in radical opposition to each other. Central Banks’ role attenuates to supporting war needs — at the expense of other variables – in wartime.
2. War implies an effective and expandable industrial capacity for producing weapons (rapidly), which, in itself, requires secure supply-lines to feed that capacity. (A quality which the West no longer possesses, and which is costly to recreate);
3. Commodities which often serve as collateral to loans become scarce – and with that scarcity, show up as commodity ‘inflation’;
4. And finally, War cuts new financial channels i.e. “the m-CBDC Bridge project” (see here).

The point needs underlining again: War creates different financial dynamics and shapes a different psyche. More importantly, ‘War’ is not a stable phenomenon. It can start with petty tit-for-tat strikes on a rival’s infrastructure and then — with every incremental ‘mission creep’ — slip along the curve towards full war. NATO is not just mission creeping in its war on Russia, it is mission jogging — fearing a Ukraine humiliation in the wake of the earlier Afghanistan débacle.

The EU hopes to halt that slide well short of full war. It is nonetheless a very slippery slope. The point of War is to inflict pain and attrit your enemy. To this extent it is open to mutation. Formal sanctions and caps on energy quickly metamorphose into the sabotage of pipelines or the seizure of tankers.

Russia and China however, are certainly not naïve, and have been busy setting their own theatre, ahead of a potential wider clash with NATO.

China and Russia can now claim to have built a strategic relationship, not only with OPEC+, but with Iran and key gas producers.

Russia, Iran, and Venezuela account for about 40% of the world’s proven oil reserves, and each of them are currently selling oil to China for renminbi at a steep discount. GCC countries account for another 40% of proven oil reserves — and are being courted by China to accept renminbi for their oil — in exchange for transformative investments.

This is a significant new battlespace being readied — ending Dollar hegemony through boiling the frog slowly.

The contesting party made the initial strike, sanctioning half of OPEC with those 40% of the world’s oil reserves. That thrust failed: the Russian economy survived — and unsurprisingly — the sanctions ‘lost’ those states to Europe, ‘handing them’ over instead to China.

China meanwhile is courting the other half of OPEC with an offer that is hard to refuse: “Over the next “three to five years”, China will not only pay for more oil in renminbi – but more significantly, ‘will pay’ with new investments in downstream petrochemical industries in Iran, Saudi Arabia, and the GCC more broadly. It will, in other words, build out the successor generation economy” for these fossil fuel exporters whose energy sell-by date approaches.

The key point here is that in the future, much more ‘value-added’ (in the course of production) will be captured locally — at the expense of industries in the West. Pozsar cheekily calls this: “Our commodity, your problem… Our commodity, our emancipation”. Or, in other words, the China-Russia axis are lighting the fires of a structural insurrection against the West across much of the Rest of World.

Its fires are aimed at ‘boiling the frog slowly’ — not just that of the dollar hegemony, but also that of a now uncompetitive western economy.

Emancipation? Yes! Here is the crux: China is receiving Russian, Iranian and Venezuelan energy at a big 30% discount.Meanwhile, Europe still gets energy for its industry — but only at a big mark-up. In short, more, and occasionally all, product added-value will be captured by cheap-energy ‘friendly’ states, at the expense of the uncompetitive ‘unfriendlies’.

“China – the nemesis – paradoxically has been a big exporter of high mark-up Russian LNG to Europe, and India a big exporter of high mark-up Russian oil and refined products such as diesel – to Europe. We should expect more [of this in the future] across more products – and invoiced not just in euros and dollars, but also renminbi, dirhams, and rupees’ ‘, Poszar suggests.

It may not look so obvious, but it is a financial war. If the EU is content to take the ‘easy way’ out of its fall into uncompetitiveness (via subsidies to allow for high-mark-up imports), then as Napoleon once remarked when observing an enemy making a mistake: Observe silence!

For Europe, this means much less domestic production – and more inflation — as price inflating alternatives are imported from the East. The West taking the ‘easy decision’ (since its renewable strategy has not been well thought through), likely will find the arrangement to be at the expense of growth in the West — a course prefiguring a weaker West, in the near future.

The EU will be particularly hard-hit. It has elected to become dependent on US LNG, just at the moment that production from US shale fields has peaked, with what output there is likely ear-marked to the US domestic market.

Thus, as general Bierman outlined how the US prepared the battlespace in Ukraine, Russia and China and the BRICS planners have been busy setting their own ‘theater’.

Of course, it doesn’t have to be like it ‘is’: Europe’s stumble towards calamity reflects an embedded psychology of the Western ruling élite. There is no strategic reasoning, nor ‘hard-decisions’ being taken in the West at all. It is all narcissistic Merkelism (hard decisions postponed, and then ‘fudged’ through subsidy handouts). Merkelism is so called after Angela Merkel’s reign at the EU, where fundamental reform was invariably postponed.

There is no need for thinking-things-through, or for hard decisions, when leaders are held by the unshakable conviction that the West IS the centre of the Universe. It is sufficient to postpone, awaiting the inexorable to unfold itself.

The recent history of US-led forever-wars is further evidence of this western lacuna: These zombie wars drag on for years with no plausible justification, only to be unceremoniously dropped. The strategic dynamics were easier suppressed and forgotten however, when fighting insurgency wars — as opposed to fighting two well-armed, peer competitor-states.

The same dysfunctionality has been apparent in many slow-rolling western crises: Nevertheless, we persist… because protecting the fragile psychology of our leaders — and an influential sector of the public — takes precedence. The inability to countenance losing drives our élites to prefer sacrifice by their own people, rather than see their delusions exposed.

Hence, reality has to be abjured. So, we live a nebulous between-times — so much happening, but so little movement. Only when the outbreak of crisis can no longer be ignored — by even the MSM and Tech censors — might some real effort be made to address root causes.

This conundrum however, places a huge burden on the shoulders of Moscow and Beijing to manage the War escalation in a careful fashion — in face of a West for whom losing is intolerable.

Russia Won’t Suffer Losses After West Imposes Oil Price Cap No Matter What – Putin

December 10, 2022

By Staff, Agencies

Russian President Vladimir Putin addressed the economic issues on Friday as he commented on the western sanctions limiting the price of Russian oil.

Noting that the cap, introduced by the G7, the EU and Australia, won’t affect Russia at the moment, Putin stressed that “The imposed cap corresponds with the prices at which we sell today. In this sense, the decision does not affect us in any way. To be honest, it is not important,” Putin said at a press conference following his visit to Kyrgyzstan. “We will not suffer losses – no matter what.”

He warned, however, that such a step may undermine global energy markets, resulting in an oil industry collapse worldwide if consumers are able to dictate prices.

“Following some harmful non-market decision would be stupid for everyone, including the consumers; because they must realize – if they will insist on prices that are pleasant to them, even if they achieve this, and the prices will go down, investments will be reduced to zero. In the end, prices will skyrocket, hitting those who offer such solutions,” he noted.

“As for the good results [in the Russian economy], it could have been better, we would like it to be better. The truth is, however, that the forecasts suggested a 20% economic recession in Russia; there is a recession, but it is at 2.9%. That’s, of course, a huge difference, and we understand that those who predicted such a development of events for us made a major mistake,” Putin said.

The Russian leader noted that, despite a certain slowdown in the economy, “the situation is indeed better than in many other countries in a number of ways,” since Russia shows better inflation numbers than Europe.

Putin also noted that Moscow would consider cutting oil output as a viable response to the price cap introduction.

“As for our reaction, I have already said that we simply won’t sell [oil] to the countries that make such decisions. Maybe, we will even consider the possibility – I’m not saying that it is decided – we will consider, if necessary, the possibility of reducing [oil] output. We have an agreement with OPEC+ on a well-known production target,” he added.

Since 2021, energy prices have been surging globally, but the situation deteriorated after February 2022, when the US, the EU, Britain, and their allies introduced sanctions on Moscow, responding to Russia’s military operation in Ukraine. As a result of the sanctions, gas prices have accelerated their growth, resulting in an energy crisis in Europe.

Nevertheless, G7 nations and the EU [which as a bloc is closely associated with the group], as well as Australia, imposed a price cap on Russian oil, setting it at $60 per barrel.

The cap, which came into effect on December 5, will be reviewed every two months to remain at 5% below the International Energy Agency benchmark. Moscow lambasted the price cap as an attempt to manipulate “the basic principles of free markets,” noting that Russia won’t sell oil to countries that adopt it.

• Russia Sets Out Response to West’s Oil Price Cap
• China Wants to Drop Dollar in Oil Trade: Reuters

Electric War

November 24, 2022

by Pepe Escobar, posted with the author’s permission and widely cross-posted

Current Russian tactics are the absolute opposite of the military theory of concentrated force developed by Napoleon, Pepe Escobar writes.

Footfalls echo in the memory
Down the passage which we did not take
Towards the door we never opened
Into the rose-garden. My words echo
Thus, in your mind.
But to what purpose
Disturbing the dust on a bowl of rose-leaves
I do not know.

T.S. Eliot, Burnt Norton

Spare a thought to the Polish farmer snapping pics of a missile wreckage – later indicated to belong to a Ukrainian S-300. So a Polish farmer, his footfalls echoing in our collective memory, may have saved the world from WWIII – unleashed via a tawdry plot concocted by Anglo-American “intelligence”.

Such tawdriness was compounded by a ridiculous cover-up: the Ukrainians were firing on Russian missiles from a direction that they could not possibly be coming from. That is: Poland. And then the U.S. Secretary of Defense, weapons peddler Lloyd “Raytheon” Austin, sentenced Russia was to blame anyway, because his Kiev vassals were shooting at Russian missiles that should not have been in the air (and they were not).

Call it the Pentagon elevating bald lying into a rather shabby art.

The Anglo-American purpose of this racket was to generate a “world crisis” against Russia. It’s been exposed – this time. That does not mean the usual suspects won’t try it again. Soon.

The main reason is panic. Collective West intel sees how Moscow is finally mobilizing their army – ready to hit the ground next month – while knocking out Ukraine’s electricity infrastructure as a form of Chinese torture.

Those February days of sending only 100,000 troops – and having the DPR and LPR militias plus Wagner commandos and Kadyrov’s Chechens do most of the heavy lifting – are long gone. Overall, Russians and Russophones were facing hordes of Ukrainian military – perhaps as many as 1 million. The “miracle” of it all is that Russians did quite well.

Every military analyst knows the basic rule: an invasion force should number three times the defending force. The Russian Army at the start of the SMO was at a small fraction of that rule. The Russian Armed Forces arguably have a standing army of 1.3 million troops. Surely they could have spared a few tens of thousands more than the initial 100,000. But they did not. It was a political decision.

But now SMO is over: this is CTO (Counter-Terrorist Operation) territory. A sequence of terrorist attacks – targeting the Nord Streams, the Crimea Bridge, the Black Sea Fleet – finally demonstrated the inevitability of going beyond a mere “military operation”.

And that brings us to Electric War.

Paving the way to a DMZ

The Electric War is being handled essentially as a tactic – leading to the eventual imposition of Russia’s terms in a possible armistice (which neither Anglo-American intel and vassal NATO want).

Even if there was an armistice – widely touted for a few weeks now – that would not end the war. Because the deeper, tacit Russian terms – end of NATO expansion and “indivisibility of security” – were fully spelled out to both Washington and Brussels last December, and subsequently dismissed.

As nothing – conceptually – has changed since then, coupled with the Western weaponization of Ukraine reaching a frenzy, the Putin-era Stavka could not but expand the initial SMO mandate, which remains denazification and demilitarization. Yet now the mandate will have to encompass Kiev and Lviv.

And that starts with the current de-electrification campaign – which goes way beyond the east of the Dnieper and along the Black Sea coast towards Odessa.

That brings us to the key issue of reach and depth of Electric War, in terms of setting up what would be a DMZ – complete with no man’s land – west of the Dnieper to protect Russian areas from NATO artillery, HIMARS and missile attacks.

How deep? 100 km? Not enough. Rather 300 km – as Kiev has already requested artillery with that kind of range.

What’s crucial is that way back in July this was already being extensively discussed in Moscow at the highest Stavka levels.

In an extensive July interview, Foreign Minister Sergei Lavrov let the cat – diplomatically – out of the bag:

“This process continues, consistently and persistently. It will continue as long as the West, in its impotent rage, desperate to aggravate the situation as much as possible, continues to flood Ukraine with more and more long-range weapons. Take the HIMARS. Defense Minister Alexey Reznikov boasts that they have already received 300-kilometre ammunition. This means our geographic objectives will move even further from the current line. We cannot allow the part of Ukraine that Vladimir Zelensky, or whoever replaces him, will control to have weapons that pose a direct threat to our territory or to the republics that have declared their independence and want to determine their own future.”

The implications are clear.

As much as Washington and NATO are even more “desperate to aggravate the situation as much as possible” (and that’s Plan A: there’s no Plan B), geoeconomically the Americans are intensifying the New Great Game: desperation here applies to trying to control energy corridors and setting their price.

Russia remains unfazed – as it continues to invest in Pipelineistan (towards Asia); solidify the multimodal International North South Transportation Corridor (INTSC), with key partners India and Iran; and is setting the price of energy via OPEC+.

A paradise for oligarchic looters

The Straussians/neo-cons and neoliberal-cons permeating the Anglo-American intel/security apparatus – de facto weaponized viruses – won’t relent. They simply cannot afford losing yet another NATO war – and on top of it against “existential threat” Russia.

As the news from the Ukraine battlefields promise to be even grimmer under General Winter, solace at least may be found in the cultural sphere. The Green transition racket, seasoned in a toxic mixed salad with the eugenist Silicon Valley ethos, continues to be a side dish offered with the main course: the Davos “Great Narrative”, former Great Reset, which reared its ugly head, once again, at the G20 in Bali.

That translates as everything going swell as far as the Destruction of Europe project is concerned. De-industrialize and be happy; rainbow-dance to every woke tune on the market; and freeze and burn wood while blessing “renewables” in the altar of European values.

A quick flashback to contextualize where we are is always helpful.

Ukraine was part of Russia for nearly four centuries. The very idea of its independence was invented in Austria during WWI for the purpose of undermining the Russian Army – and that certainly happened. The present “independence” was set up so local Trotskyite oligarchs could loot the nation as a Russia-aligned government was about to move against those oligarchs.

The 2014 Kiev coup was essentially set up by Zbig “Grand Chessboard” Brzezinski to draw Russia into a new partisan war – as in Afghanistan – and was followed by orders to the Gulf oil haciendas to crash the oil price. Moscow had to protect Russophones in Crimea and Donbass – and that led to more Western sanctions. All of it was a setup.

For 8 years, Moscow refused to send its armies even to Donbass east of the Dnieper (historically part of Mother Russia). The reason: not to be bogged down in another partisan war. The rest of Ukraine, meanwhile, was being looted by oligarchs supported by the West, and plunged into a financial black hole.

The collective West deliberately chose not to finance the black hole. Most of the IMF injections were simply stolen by the oligarchs, and the loot transferred out of the country. These oligarchic looters were of course “protected” by the usual suspects.

It’s always crucial to remember that between 1991 and 1999 the equivalent of the present entire household wealth of Russia was stolen and transferred overseas, mostly to London. Now the same usual suspects are trying to ruin Russia with sanctions, as “new Hitler” Putin stopped the looting.

The difference is that the plan of using Ukraine as just a pawn in their game is not working.

On the ground, what has been going on so far are mostly skirmishes, and a few real battles. But with Moscow massing fresh troops for a winter offensive, the Ukrainian Army may end up completely routed.

Russia didn’t look so bad – considering the effectiveness of its mincing machine artillery strikes against Ukrainian fortified positions, and recent planned retreats or positional warfare, keeping casualties down while smashing Ukrainian withering firepower.

The collective West believes it holds the Ukraine proxy war card. Russia bets on reality, where economic cards are food, energy, resources, resource security and a stable economy.

Meanwhile, as if the energy-suicide EU did not have to face a pyramid of ordeals, they can surely expect to have knocking on their door at least 15 million desperate Ukrainians escaping from villages and cities with zero electrical power.

The railway station in – temporarily occupied – Kherson is a graphic example: people show up constantly to warm up and charge their smartphones. The city has no electricity, no heat, and no water.

Current Russian tactics are the absolute opposite of the military theory of concentrated force developed by Napoleon. That’s why Russia is accumulating serious advantages while “disturbing the dust in a bowl of rose-leaves”.

And of course, “we haven’t even started yet.”

Russia, India, China, Iran: the Quad that really matters

Tuesday, 15 November 2022 3:55 PM 

By Pepe Escobar

Southeast Asia is right at the center of international relations for a whole week viz a viz three consecutive summits: Association of South East Asian Nations (ASEAN) summit in Phnom Penh, the Group of Twenty (G20) summit in Bali, and the Asia-Pacific Economic Cooperation (APEC) summit in Bangkok.  

Eighteen nations accounting for roughly half of the global economy represented at the first in-person ASEAN summit since the Covid-19 pandemic in Cambodia: the ASEAN 10, Japan, South Korea, China, India, US, Russia, Australia, and New Zealand. 

With characteristic Asian politeness, the summit chair, Cambodian Prime Minister Hun Sen (or “Colombian”, according to the so-called “leader of the free world”), said the plenary meeting was somewhat heated, but the atmosphere was not tense: “Leaders talked in a mature way, no one left.”

It was up to Russian Foreign Minister Sergey Lavrov to express what was really significant at the end of the summit.

While praising the “inclusive, open, equal structure of security and cooperation at ASEAN”, Lavrov stressed how Europe and NATO “want to militarize the region in order to contain Russia and China’s interests in the Indo-Pacific.”

A manifestation of this policy is how “AUKUS is openly aiming at confrontation in the South China Sea,” he said.

Lavrov also stressed how the West, via the NATO military alliance, is accepting ASEAN “only nominally” while promoting a completely “unclear” agenda. 

What’s clear though is how NATO “has moved towards Russian borders several times and now declared at the Madrid summit that they have taken global responsibility.”

This leads us to the clincher: “NATO is moving their line of defense to the South China Sea.” And, Lavrov added, Beijing holds the same assessment.

Here, concisely, is the open “secret” of our current geopolitical incandescence. Washington’s number one priority is the containment of China. That implies blocking the EU from getting closer to the key Eurasia drivers  – China, Russia, and Iran – engaged in building the world’s largest free trade/connectivity environment.

Adding to the decades-long hybrid war against Iran, the infinite weaponizing of the Ukrainian black hole fits into the initial stages of the battle.

For the Empire, Iran cannot profit from becoming a provider of cheap, quality energy to the EU. And in parallel, Russia must be cut off from the EU. The next step is to force the EU to cut itself off from China.

All that fits into the wildest, warped Straussian/neo-con wet dreams: to attack China, by emboldening Taiwan, first Russia must be weakened, via the instrumentalization (and destruction) of Ukraine.

And all along the scenario, Europe simply has no agency.     

Putin, Raeisi and the Erdogan track

Real life across key Eurasia nodes reveals a completely different picture. Take the relaxed get-together in Tehran between Russia’s top security official Nikolai Patrushev and his Iranian counterpart Ali Shamkhani last week.

They discussed not only security matters but also serious business – as in turbo-charged trade.

The National Iranian Oil Company (NIOC) will sign a $40 billion deal next month with Gazprom, bypassing US sanctions, and encompassing the development of two gas fields and six oilfields, swaps in natural gas and oil products, LNG projects, and the construction of gas pipelines.

Immediately after the Patrushev-Shamkhani meeting, President Putin called President Ebrahim Raeisi to keep up the “interaction in politics, trade and the economy, including transport and logistics,” according to the Kremlin.

Iranian president reportedly more than “welcomed” the “strengthening” of Moscow-Tehran ties.

Patrushev unequivocally supported Tehran over the latest color revolution adventure perpetrated under the framework of the Empire’s endless hybrid war.

Iran and the EAEU are negotiating a Free Trade Agreement (FTA) in parallel to the swap deals with Russian oil. Soon, SWIFT may be completely bypassed. The whole Global South is watching.

Simultaneous to Putin’s phone call, Turkiye’s Recep Tayyip Erdogan – conducting his own diplomatic overdrive, and just back from a summit of Turkic nations in Samarkand – stressed that the US and the collective West are attacking Russia “almost without limits”. 

Erdogan made it clear that Russia is a “powerful” state and commended its “great resistance”.

The response came exactly 24 hours later. Turkish intelligence cut to the chase, pointing out that the terrorist bombing in the perpetually busy Istiklal pedestrian street in Istanbul was designed in Kobane in northern Syria, which essentially responds to the US.

That constitutes a de-facto act of war and may unleash serious consequences, including a profound revision of Turkiye’s presence inside NATO.

Iran’s multi-track strategy

A Russia-Iran strategic alliance manifests itself practically as a historical inevitability. It recalls the time when the erstwhile USSR helped Iran militarily via North Korea, after an enforced US/Europe blockade.

Putin and Raeisi are taking it to the next level. Moscow and Tehran are developing a joint strategy to defeat the weaponization of sanctions by the collective West.

Iran, after all, has an absolutely stellar record of smashing variants of “maximum pressure” to bits. Also, it is now linked to a strategic nuclear umbrella offered by the “RICs” in BRICS (Russia, India, China).

So, Tehran may now plan to develop its massive economic potential within the framework of BRI, SCO, INSTC, the Eurasia Economic Union (EAEU), and the Russian-led Greater Eurasia Partnership.

Moscow’s game is pure sophistication: engaging in a high-level strategic oil alliance with Saudi Arabia while deepening its strategic partnership with Iran.

Immediately after Patrushev’s visit, Tehran announced the development of an indigenously built hypersonic ballistic missile, quite similar to the Russian KH-47 M2 Khinzal.

And the other significant news was connectivity-wise: the completion of part of a railway from strategic Chabahar Port to the border with Turkmenistan. That means imminent direct rail connectivity to the Central Asian, Russian and Chinese spheres. 

Add to it the predominant role of OPEC+, the development of BRICS+, and the pan-Eurasian drive to pricing trade, insurance, security, investments in the ruble, yuan, rial, etc.

There’s also the fact that Tehran could not care less about the endless collective West procrastination on the Joint Comprehensive Plan of Action (JCPOA), commonly known as Iran nuclear deal: what really matters now is the deepening relationship with the “RICs” in BRICS. 

Tehran refused to sign a tampered-with EU draft nuclear deal in Vienna. Brussels was enraged; no Iranian oil will “save” Europe, replacing Russian oil under a nonsensical cap to be imposed next month.

And Washington was enraged because it was betting on internal tensions to split OPEC.  

Considering all of the above, no wonder US ‘Think Tankland’ is behaving like a bunch of headless chickens.  

The queue to join BRICS

During the Shanghai Cooperation Organization (SCO) summit in Samarkand last September, it was already tacit to all players how the Empire is cannibalizing its closest allies.

And how, simultaneously, the shrinking NATO-sphere is turning inwards, with a focus on The Enemy Within, relentlessly corralling average citizens to march in lockstep behind total compliance with a two-pronged war – hybrid and otherwise – against imperial peer competitors Russia and China.

Now compare it with Chinese President Xi Jinping in Samarkand presenting China and Russia, together, as the top “responsible global powers” bent on securing the emergence of multipolarity.

Samarkand also reaffirmed the strategic political partnership between Russia and India (Indian Prime Minister Narendra Modi called it an unbreakable friendship).

That was corroborated by the meeting between Lavrov and his Indian counterpart Subrahmanyam Jaishankar last week in Moscow.

Lavrov praised the strategic partnership in every crucial area – politics, trade and economics, investment, and technology, as well as “closely coordinated actions” at the UN Security Council, BRICS, SCO and the G20.

On BRICS, crucially, Lavrov confirmed that “over a dozen countries” are lining up for membership, including Iran: “We expect the work on coordinating the criteria and principles that should underlie BRICS expansion to not take much time”.

But first, the five members need to analyze the ground-breaking repercussions of an expanded BRICS+. 

Once again: contrast. What is the EU’s “response” to these developments? Coming up with yet another sanctions package against Iran, targeting officials and entities “connected with security affairs” as well as companies, for their alleged “violence and repressions”.

“Diplomacy”, collective West-style, barely registers as bullying.

Back to the real economy – as in the gas front – the national interests of Russia, Iran and Turkiye are increasingly intertwined; and that is bound to influence developments in Syria, Iraq, and Libya, and will be a key factor to facilitate Erdogan’s re-election next year.

As it stands, Riyadh for all practical purposes has performed a stunning 180-degree maneuver against Washington via OPEC+. That may signify, even in a twisted way, the onset of a process of unification of Arab interests, guided by Moscow.

Stranger things have happened in modern history. Now appears to be the time for the Arab world to be finally ready to join the Quad that really matters: Russia, India, China, and Iran.

(The views expressed in this article are the author’s own and do not necessarily reflect those of Press TV.)

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Algeria Declaration: Palestine is our central cause

2 Nov 2022 19:06

Source: Al Mayadeen Net

By Al Mayadeen English 

The concluding statement of the Arab Summit emphasizes supporting OPEC+’s decision to cut oil production by two million barrels a day.

The Arab Summit demanded lifting the unjust blockade on Gaza.

The Arab League Summit issued, on its second day in the Palace of Conferences in Algiers, the Algeria Declaration document.

The heads of the Arab states stressed “the centrality of the Palestinian cause and full support for the rights of the Palestinian people, including the right to freedom and self-determination and the right to return, in addition to making the compensation payments for the Palestinian refugees, in accordance with the United Nations General Assembly Resolution No. 194 of 1948.”

The Summit demanded lifting the Israeli blockade on the Gaza Strip and condemning the Israeli occupation’s brutality and barbaric practices against Palestinians, including assassinations and arbitrary arrests.” The Summit also called for the release of all prisoners and detainees, especially children, women, the sick, and the elderly.

The statement emphasized the necessity of “endorsing the pursuit of the Palestinian state to obtain full membership at the United Nations and urging the countries that have not yet recognized the state of Palestine to do so, coupled with the necessity of supporting the legal Palestinian efforts and attempts to hold the Israeli occupation accountable for its war crimes.”

Moreover, the statement confirmed that the Summit supports the policy of OPEC+, which includes oil-producing countries from inside and outside the OPEC organization, in the global energy market.

Algeria confirmed that it “appreciates the balanced policy of the OPEC+ alliance in order to ensure the stability of the global energy markets and sustainability of investments in this sensitive sector as part of an economic approach that ensures protecting the interests of producing and consuming countries alike.”

On October 5, OPEC+ announced reducing oil by two million barrels a day in order to support the markets facing the risk of a decrease in demand for crude oil due to the economic crisis.

The attending states also rejected “all forms of foreign intervention in the Arab countries’ internal affairs” and expressed their insistence on the principle of finding Arab solutions to Arab problems by strengthening the role of the Arab League in preventing crises and solving them through peaceful means and working to strengthen inter-Arab relations.

The attending Arab countries expressed “full solidarity with the Libyan people and support for the efforts aimed at ending the Libyan crisis through a Libyan-Libyan solution that preserves the unity and sovereignty of Libya and safeguards its security and that of the neighboring countries.”

The statement concluded, “All the states should assume a collective leading role to contribute to the efforts made in order to reach a political solution for the Syrian crisis and address all the political, security, humanitarian, and economic repercussions, through what ensures the unity and sovereignty of Syria and realizes the ambitions of its people.”

Algerian FM Ramtane Lamamra: The success of the Algerian summit is the success of all Arabs

Algerian Foreign Minister Ramtane Lamamra considered on Wednesday that the success of the Algerian summit is the success of all Arabs who knew how to come together and agree after the Corona pandemic and realized the importance of unity and the sensitivity of the regional and global situation.

Lamamra said that “the attendance was significant, positive, and constructive, and everyone was eager to apply whatever can contribute to the Arab unity.”

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MBS Will Have to Choose Between Acquiescence or A Fate Like that of King Faisal

October 25, 2022

By Mohammad Baqer Yassin

There is a new season of the Saudi-US soap opera and the tense relationships between the allies. What’s new in the crisis is the decision of the OPEC+ to reduce oil production which has urged a clear American response, along with a series of reactions in newspapers and speeches of US politicians, amid a Saudi affirmation on the technical aspect of the unanimously-made decision, according to Riyadh. Is the Saudi decision purely technical or political? What are the expected American steps towards Riyadh? Will the Kingdom insist on its position or will it acquiesce, as usual?

To clarify the nature of the decision taken by OPEC +, we must go back to the time before the decision was taken, as the Wall Street Journal articulated that “US Officials called on their Gulf counterparts, headed by Saudi Arabia, to postpone the decision for another month, which was rejected by Saudis.” The newspaper also stated, according to sources within the Saudi government, that “Saudi Crown Prince Mohammed bin Salman [MBS] told his advisers that he is not willing to sacrifice much for the administration of US President Joe Biden, which criticizes Saudi Arabia’s war in Yemen and is trying to conclude a nuclear agreement with Iran which Riyadh opposes.” Adding to the aforementioned, the decision of Aramco, the Saudi energy company, to raise prices of oil exports to the US in November, it becomes clear to us that the Saudi decision unmasks the economic-shelled Saudi decision as purely political. MBS is under US pressure in three stressful topics [the war on Yemen, the nuclear agreement and the Jamal Khashoggi case]. Thus, by reducing production, he tried to blackmail the US administration, as it is in this sensitive stage in need of stabilizing oil prices, especially to harm its enemy Russia, in order to reach its goals.

After facing the American anger, MBS was sure he made a foolhardy rushing decision of overwhelming consequences. He consequently insisted that it was a pure technical decision with no political dimension, which forced Saudi officials to issue statements agreeing with this point. For this purpose, Adel Al-Jubeir spoke several times on this point in particular, and after him, Saudi Foreign Minister Faisal bin Farhan in an interview with Al-Arabiya, in which he confirmed that “the decision of OPEC + is purely economic, and the decision was taken unanimously by member states.” After the failure of this attempt, the kingdom was forced to save face through its foreign ministry statement, in which it rejected what it called “dictations, actions or efforts seeking to alter the lofty goals it is working on to protect the global economy from oil market fluctuations,” adding that the Kingdom “looks at its relationship with the US from a strategic perspective that serves the mutual interests of both countries.” Lately, Riyadh called upon the positions of states [like Kuwait, Qatar, Iraq, Jordan, Pakistan, Tunisia, Malaysia, Egypt, Morocco and Algeria so far] to back its “technical position” in the face of continuous American declarations regarding reducing oil production.

MBS’s blackmailing of Washington during tough circumstances urged a strong reaction from the US side, expressed by media and American political figures by demanding deterrent measures. This blackmail forced US President Joe Biden to talk about serious consequences during his interview with CNN. Speaking in the interview, Biden hasn’t defined the nature of his administration’s decisions against the Saudi decision, as he said that he would not go into details. He was quoted as saying that his country is discussing reviewing relations.

Among the expected measures, which fall under the division of military measures, is reducing or canceling military deals between Washington and Riyadh, as well as withdrawing air defense batteries. If the US goes far in its decision, it would evacuate its bases in the Kingdom. Furthermore, economic sanctions against Riyadh are among the expected measures, especially after it classified the Saudi move as being part of Russia’s aid. The US will include Saudi Arabia in the list of states and companies sanctioned for their cooperation with Russia, if it wants to move forward and give its words legal effects. Accordingly, the US is sending MBS a deterrent message that will make him think wisely before taking any similar measures in the future, and in order for him to know his limits and that he should not cross them.

On the basis of what has been stated before, MBS is bounded by two difficult choices, the best of which is bitter; the first one is to acquiesce again to US dictates, and the second is to continue insisting on his firm stance and take the decision to the end. MBS set the ground for the first choice when he limited his decision in the pure technical dimension and neglected any support to Russia, this delivers a message saying that he was still under the path of American dependency and did not deviate from it. As for the second option, MBS knows with certainty that his fate will not be far from the fate of King Faisal, and he will not be dearer to him in the American administration.

Saudi Arabia doubles up on Russia’s request to cut down production

 October 21, 2022

Source: The Intercept

By Al Mayadeen English 

Russia requested a one million barrels reduction in OPEC+ production, but Saudi Arabia insisted on a two million barrels reduction, which was a surprise even to Putin.

The oil cut was deliberately planned by Saudi Arabia to hurt Dems, the 

The Intercept published an article on Thursday that detailed the reasons why Saudi Arabia pushed for an oil cut on October 5, which rankled Democrats in Washington ahead of the upcoming midterms elections which are set to take place on November 8. 

OPEC+ had announced earlier this month that it was slashing 2 million barrels of oil per day, leading the Democrats to accuse Riyadh of taking Russia’s side in that decision. 

“What Saudi Arabia did to help Putin continue to wage his despicable, vicious war against Ukraine will long be remembered by Americans,” said Senate Majority Leader Chuck Schumer.

However, according to two anonymous Saudi sources familiar with the matter, Saudi Arabia pushed the oil cut twice as much as Russia intended, thus revealing motives that “run deeper than what top Democrats want to admit.”

The media has especially made it obvious that Saudi Arabia intended to drive an oil cut that was far more aggressive than Russia’s.

On September 27, Russia sought to implement a 1 million barrel per day cut — just half of what would later be agreed upon.

This is what the world initially expected. 

Then came the fatal announcement on October 5 that OPEC+ would double that cut by 2 million barrels a day.

On October 14, the White House National Security Council Spokesperson John Kirby accused Saudi Arabia of coercing other OPEC+ members who did not initially agree on the cut though he failed to specify which countries.

According to The Wall Street Journal, the members who were “coerced” into agreeing to the cut include Kuwait, Iraq, Bahrain, and the UAE.

That is obviously untrue since Iraq recently expressed that it fully supported OPEC+’s decision. 

These countries reportedly feared that the production cuts could lead to a recession that would ultimately reduce demand for oil.

But Saudi Arabia’s decision came as a shock to the US.

“People in D.C. think MBS is siding with Putin, but I think MBS is even more Putinian than Putin,” one of the sources, a Saudi close to the royal family, said, referring to Saudi Arabia’s de facto ruler, Crown Prince Mohammed bin Salman.

Read more: Iraq rejects exerting pressure policy, supports OPEC+ decision

Despite that Saudi Arabia argued that its decision was based on goodwill and wholly economic and aimed at stabilizing the energy markets, the Democrats accused the Saudis of “pursuing a conscious alignment with Russia.”

“The Saudi foreign ministry can try to spin or deflect, but the facts are simple,” Kirby said, alleging that “they knew” that the oil production cut would “increase Russian revenues and blunt the effectiveness of sanctions” against Russia amid its special operation in Ukraine.

Some Democratic experts argue that the cut particularly targets the Democratic Party, something that officials have been reluctant to admit.

Bruce Riedel, a senior fellow at the Brookings Institution, told The Intercept in an email, “The Saudis are well aware that the price of gasoline at the pump has been a crucial political issue in the United States since 1973.”

“They want a big increase to help the Republicans,” he added, explaining that MBS sees the GOP winning back Congress as the “first step to Trump winning in 2024 and a setback for Biden.”

Read more: WH considers recommending US firms of pulling out from Saudi Arabia

During the 1970s, Saudi Arabia led two oil embargoes that had a decisive impact on the US economy and on presidential elections which cost Jimmy Carter to lose to Ronald Reagan in 1980.

Following this defeat, Carter placed solar panels on the White House roof to bring to light the US’ over-dependency on oil; a gesture he was mocked for.

Since MBS stepped into power, it was clear that the Conservatives had less difficulty dealing with oil demands.

MBS complied with Donald Trump two times over the fluctuation of gas prices: the first in 2018 and the second in 2020 so that Trump can ensure that the domestic American shale industry would survive the pandemic. 

“MBS enjoyed a sweetheart relationship with Trump,” Riedel said. “Trump stood by MBS when he murdered Khashoggi and his war in Yemen which has starved tens of thousands of children; there was never any criticism of the Saudi’s human rights abuses from the Trump administration.”

As soon as Trump got elected, the first thing he did was fly to Riyadh as President where he was generously well-received and struck a record-breaking $350 billion weapons deal with the Saudi government.

He also vetoed three separate congressional bills that would have blocked the sale of weapons to Riyadh, and he even boasted about covering MBS from consequences for the murder of journalist Jamal Khashoggi, saying, “I saved his ass.”

Read more: Biden sells more oil reserve after OPEC+ cut, US crude at $80 lows

Sarah Leah Whitson, executive director of Democracy in the Arab World Now, said, “You don’t need to look hard to understand that MBS is deliberately and persistently acting against U.S. interests and the Biden administration in particular. His actions are not just ‘snubs’ but punches in the face.”

“He’s very nakedly using oil as a lever to try to influence the midterm elections with the aim of bringing in more compliant Republicans, trying to show us all who’s boss even in our own democracy.”

Saudi officials have themselves acknowledged that they could exert an impact on the domestic US.

In 2004, Prince Bandar bin Sultan Al Saud, the Saudi aQmbassador to the US from 1983 to 2006, said during a talk show, “The kingdom’s oil decisions can influence the election or non-election of the president of the United States, the largest and strongest country in the world. For that to be taken into consideration, regardless of what the kingdom decides to do, is in itself evidence of the strategic weight for the kingdom of Saudi Arabia.”

In another interview in 2004, Bandar said, “President [Bill] Clinton asked us to keep the prices down in the year 2000. In fact, I can go back to 1979, President Carter asked us to keep the prices down to avoid the malaise.”

In October 2018, following the assassination of Khashoggi, a Washington Post columnist, Turki Aldakhil warned of an economic disaster if the US sanctioned Riyadh.

“If U.S. sanctions are imposed on Saudi Arabia, we will be facing an economic disaster that would rock the entire world,” wrote Turki Aldakhil. “It would lead to Saudi Arabia’s failure to commit to producing 7.5 million barrels [of oil].”

We are not saying here that Saudi Arabia under MBS hasn’t pursued cozier relations with Russia. 

Relations between Putin and MBS go back to 2015 when former US President Barack Obama turned down MBS’ requests for a meeting. MBS had then opted to meet with Putin on the sidelines of the 19th St. Petersburg International Economic Forum.

In response to the oil slash OPEC+ imposed, and after using up all other possible options, the White House was left with no choice but to release 15 million barrels of oil from its strategic emergency oil reserves.

It even considered lifting sanctions on Venezuela to alleviate the negative effects of OPEC+’s production cut.

An executive vice president of the Quincy Institute, Trita Parsi, told The Intercept, “The U.S. has helped artificially make Saudi Arabia more powerful on the energy markets by sanctioning the oil of other major producers.” 

“Just as [Secretary of State] Tony Blinken said that the destruction of the Nord Stream gas pipeline was an opportunity for Europe to reduce its dependence on Russian gas, Biden should turn the current crisis into an opportunity to reduce its own dependence on Riyadh by rethinking its unsuccessful energy sanctions on Venezuela and Iran.”

Read more: Blinken says OPEC+ oil production cut not action of ally

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عندما يستثمر ابن سلمان في «القبَلية» الأميركية

الثلاثاء 18 تشرين الأول 2022

علاقة أميركا مع الدول المرتبطة بها، هي علاقة مصلحة متبادلة (أ ف ب)

موسى السادة  

يتيح قرار منظّمة «أوبك +» الأخير، خفْض إنتاج النفط بما يقارب المليونَي برميل يومياً، فرصة لقراءة الأبعاد المختلفة للعلاقات الدولية اليوم، وأبرزها العلاقة بين المملكة السعودية والولايات المتحدة، إذ إن تداعيات هذا القرار ستطاول أكثر من ملفّ، في ظلّ وضع دولي غير مسبوق تسارعت التحوّلات فيه بعد الحرب الروسية على أوكرانيا. تستدعي قراءةٌ كتلك، التنبّه إلى ثلاثة أوجهٍ مختلفة متشابكة: أوّلها، الاختلال في قوّة الولايات المتحدة وأدوات سيطرتها على السياسة الدولية، وثانيها، حجم هذا الاختلال وكيفية تأثيره في الداخل الأميركي واستقطاباته السياسية والاجتماعية، وثالثها التغيّر في ديناميكية علاقة الدول المرتبطة بأميركا، خصوصاً حين الحديث عن دولة بحجم وأهمية السعودية، التي تمتدّ وتنصهر ارتباطاتها بالولايات المتحدة، بشكل يتداخل مع مجال السياسة الداخلية الأميركية.

من هنا، يمكن النظر إلى قرار «أوبك +» من زاوية كوْنه خطوة سعودية ستؤثّر في الهيمنة الأميركية الدولية. ذلك أن واحداً من تداعياته سيكون دعم الاقتصاد الروسي، المنخرط في مجهود عسكري ضدّ أوكرانيا وحلف «الناتو». أمّا الزاوية الأخرى، فهي تأثير القرار في الداخل الأميركي، في فترة زمنية حسّاسة تسبق الانتخابات النصفية، وهذا بالتحديد هو ما يشغل الأميركيين أكثر من تأثير الخطوة في الطرف الروسي. وفي حين كان الخطاب الرسمي السعودي بالغ الدبلوماسية في التعاطي مع القرار، إلّا أن مُريدي السعودية، وبل حتى سواهم، قاربوه كدليل على استقلالية قرار المملكة وتقديمها مصلحتها الوطنية أولاً، وإنْ كان في وجه أميركا نفسها، وهو ما دفع خصوم السعودية، القائم خطابهم على تبعيّتها لـ«بيت الطاعة» الأميركي والغربي، إلى اتّخاذ موقع دفاع، في تنابُز إعلامي وسياسي مديد في المجال السياسي العربي.

إلّا أن ما يجب اعتباره من القرار، بعيداً عن هذا التنابز، هو عبر قراءة مركّبة لشكل العلاقة التاريخية بين المملكة وأميركا، بالإمكان توسيعها أيضاً لتشمل كلّ دولة تُحكم من نُخب تتشابك وترتبط مصالحها مع الولايات المتحدة. فالتفسير الهشّ القائم على تبسيط شكل العلاقة إلى حدود «سيّد» يأمر وينهى كيفما وأينما شاء دونما أيّ اعتبارات؛ و«عبد» يطيع، إنّما هو تفسير خاطئ يؤسّس لقراءة خاطئة. الواقع أن علاقة أميركا مع الدول المرتبطة بها، هي علاقة مصلحة متبادلة، وأن ما يقتضيه لفظ «الهيمنة الأميركية» هو أن كفّة القوة ضمن علاقة المصلحة تلك، تميل بشكل قاهر لصالح الأميركيين. تختلف، هنا، أدوات القوة وأشكالها من دولة إلى أخرى، ومنها مثلاً الابتزاز بوقْف المِنح المالية والعسكرية، أو التهديد بالتضييق والعقوبات، أو في الحالة المميّزة في الخليج العربي التهديد برفع الحماية العسكرية، مثلما ينادي به اليوم العديد من أعضاء الكونغرس الأميركي، وصرّح به مسؤولون أميركيون مختلفون ومباشرة على شاشات التلفزة، بقولهم: «هل يظنّ السعوديون أن الروس أو الصينيين قادرون على توفير الحماية لهم؟».

المثير والمهمّ، هو كيف أمست السياسة الأميركية أشبه بسياسات دول غير متماسكة

وإذ يأتي هذا التهديد ضمن مسار تاريخي من الشدّ والجذب وفق ما تقتضيه المصلحة، فإن الأمر المختلف اليوم هو أننا أمام واقع دولي وأميركي داخلي مغاير، يظهّر اهتزازاً لفعالية أوراق الابتزاز الأميركية، وهو ما فهمه السعوديون جيداً.
ولعلّ أهمّ وجوه اهتزاز السطوة ذاك، يمكن استشفافه من مراقبة تبدُّل شكل علاقة النُّخب الحاكمة الخليجية بالولايات المتحدة وجرأتها السياسية. فهذه النُّخبة السعودية هي أوّل مَن يستشعر ويهاب تقهقر أميركا التي رهنت ديمومة حُكمها بها. وبالنسبة إلى المملكة، وتحديداً منذ تسلُّم محمد بن سلمان السلطة الفعلية، كانت السنوات السبع الماضية مخاضاً للتكيّف في التعامل مع الأميركيين، والأهمّ الوصول إلى القدرة على استغلال تناقضاتهم الداخلية. ومن هنا، ولكي لا يُفهم قرار «أوبك +» كانحياز كامل إلى الروس، حرص السعوديون على موازنته، بإعلانهم عن هِبة مادّية بقرابة 400 مليون دولار لأوكرانيا، وأيضاً تواصلهم مع المسؤولين الأوكرانيين والطلب منهم التغريد بتصريحات تثمّن مواقف المملكة. هذه الموازنة في حدّ ذاتها تعكس ضعفاً أميركياً وغربياً، حيث تخشى الدول حتى المرتبطة أمنياً واقتصادياً بواشنطن، وعلى الرغم من احتدام الصراع الروسي – الغربي، من التخندق الصارخ إلى جانب أيّ من الطرفَين.
البُعد الآخر الذي تظهّره هذه الموازنة، هو أن قرار «أوبك +» في جوهره ليس اصطفافاً ضدّ الغرب مع روسيا، بل محاولة للتأثير في الداخل الأميركي وفي حكومة الرئيس جو بايدن على وجه التحديد، إذ تُعدّ السياسة الداخلية الأميركية مسرحاً مهمّاً ليس للحُكم السعودي فقط، بل حتى للشخصيات السعودية المعارضة، التي تعمل من داخل التجاذبات الحزبية على التحريض على حُكم آل سلمان، سواء على المستوى القضائي أو الإعلامي. ولذلك، يؤثّر السعوديون في المجال السياسي الأميركي في إطار مصالحهم، وبحجم ونوع غير مسبوقَين، لم يكونا ليتحقّقا لولا حجم الاستقطاب والتناقضات الداخلية الأميركية الحادّة. بتعبير آخر، إن الاهتزاز الذي يصيب الولايات المتحدة على الساحة الدولية، وحجم الاستقطاب السياسي – الاجتماعي في داخلها، يؤثّر أحدُهما في الآخر بشكل سلبي. ومن هنا، يمسي وصْف البيت الأبيض قرار «أوبك +» بـ«بالعمل العدائي» خاوياً، والأمر ذاته ينسحب على مسألة التدخّل في الانتخابات. ذلك أن حجم الشقاق الجمهوري – الديموقراطي، حال دون إقرار موقف موحّد تجاه خطوة المنظّمة، ليضيع ردّ الفعل في زحمة الاختلافات الحزبية. وحتى وإنْ حرص الجمهوريون على تبيان امتعاضهم من القرار، لكي لا يَظهروا بمظهر غير المبالين بأثره في الناخبين الأميركيين، إلّا أنهم ألقوا باللوم المباشر على بايدن. ويضاف إلى ذلك، قيام أعضاء من الحزبَين بتبنّي سرديات مِن قَبيل أن بايدن أراد من السعوديين مجرّد تأجيل القرار شهراً واحداً حتى تَظهر نتائج الانتخابات، أو سردية أن الجمهوريين هم مَن دفعوا بالسعوديين نحو خطوتهم الأخيرة للإضرار ببايدن ومحاولة كسْب الانتخابات. وهنا، ضاع موضوع تمرّد السعوديين وقيامهم بما وُصف بـ«العمل العدائي».

المثير والمهمّ، هو كيف أمست السياسة الأميركية أشبه بسياسات دول غير متماسكة، أو حتى بسياسات النُّخب الحاكمة العربية القائمة على تعصّب الأطراف بعضها ضدّ بعض. فلو وضعْنا القرار السعودي في حقبة زمنية ماضية، ولْنقل في فترة باراك أوباما الأولى، فما كان له أن يتمّ، إذ إن الهوية الأميركية كانت متماسكة على نحو سيدفع الجميع إلى اعتبار الخطوة «عملاً عدائياً»، إلّا أن القبَلية الحزبية والاستقطاب الأميركي اليوم، وهّنا من الهوية الأميركية لصالح المصالح الحزبية – الهويّاتية الضيّقة. ومن هنا، يَبرز قرار «أوبك +»، ليس كمحاولة للانعتاق من الولايات المتحدة، اقتصادياً وسياسياً وعسكرياً وبل حتى ثقافياً، بل كمؤشّر إلى ولادة مرحلة دولية، وأميركية داخلية، جديدة على الدول المرتبطة نُخبها بالأميركيين، وقواعد لَعِبها مختلفة عن الماضي، وهذا بالتحديد ما يحاول السعوديون التأقلم معه، وصوغ وجودهم ضمن تناقضاته.

من ملف : السعودية – أميركا: أزمة تخادُم

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The Western Empire Attacks Russia: The World Strikes Back

October 14, 2022

Source

by Jo Red

In war, as in life more generally, the concept of tempo is essential.

In his masterpiece Philosophy and Real Politics, British “Leninist” philosopher Raymond Geuss emphasizes “priorities, preferences, timing” (p. 30) as defining differences between “real politics” and the abstract, universalistic philosophy that flattens everything in the unfathomable ignorance of timeless present and depthless surface.

Be reminded of that while you celebrate Putin’s birthday by cheering at the destruction of the Crimean bridge – and the loss of 3 innocent lives. Please be reminded of that. Either one or the other must hold: you plan and execute war – just like anything else – with a view to its intrinsic logic – dictating its own and specific tempo – or else, you go on the offensive and strike with an ear for audience and a view for choreographic photo ops. No, world history and Putin’s, or any other individual’s, private life events being synchronized is not a possibility. That’s called “delusion of reference” and might be a sign of serious mental illness.

The point I’m trying to get across is that, contrary to Ukraine, Russia will not rush to respond to Ukraine’s symbolic provocations in the timing of any mediatic agenda. Big Serge has explained very convincingly that they are probably following the schedule dictated by military and political necessity, rather than the “events” that attract the attention of Western so-called “politicians”. By the way, has Zelensky been reminded of Putin’s b-day by Facebook?

Be it as it may, it would be a mistake to think that, because of the advances of the Ukrainians on the ground, Russia’s offensive is not “proceeding”. While the UA’s junta continues to push Ukraine’s youth forward to be uselessly massacred in occupying some almost empty 2000 sq km under Russian target shooting, global developments unfold in the embarrassed “distraction” of Western media.

Putin in his recent speech, Pope Francis since years ago, and well, just anybody else at this point has been able to tell you that this is a global war. The Nord Stream sabotage at the hands of the Anglo-Americans is only additional, unnecessary evidence that the confrontation with Russia reaches from Caucasus to the Danish Sea and beyond.

Only a few days ago, an anti-French and pro-Russian uprising expelled the latest iteration of Parish’s endeared viceroys in the country. I won’t deny that seeing so many, newly liberated Africans waving the Russian flag moved me. It is just another step in the global anti-colonial, liberation struggle outlined by Putin in his programmatic speech.

If you like counting square km, well Burkina Faso stretches over 274 200. The 74^th country in the world by surface, with a population of 20 million: we could say, average size. I know, I know, anything happening South to the Mediterranean and involving Black people is irrelevant until they are slave-traded and “integrated” into the Metropolis: only then, and only if they vote right (i.e. left) Black Lives Matter. But whatever the Western empire’s propaganda is saying – or conceiling – the truth is that the colonies are absolutely vital for its hegemony. Africa is the youngest continent, and possibly the richest in resources: it is no coincidence if the French, British, and nowadays the American continue to feast on it. France will simply be unable to retain its standard of living without its neo-colonies. And that moment is coming. The Central African Republic, Mali, and now Burkina, have recently broken free. And it is everything but unlikely that other states in the area will follow. Nearby, Niger and Chad still suffer under the French yoke, but not passively. The Chadian dictator Idriss Déby died at the hands of the rebel in 2021, and his young son is now leading the country. The local junta has just postponed free elections by another two years, yet obviously, as these are NATO’s friends, you won’t read or hear about violations of democracy.

On to another plexus in world power, the Middle East is undergoing a seismic-range transformation as the divides that defined the region cannot be taken for granted anymore. It is already some time since Turkey has timidly restarted some dialogue with Syria. Iran only drew nearer to Russia and China by entering the SCO. Besides being key in assembling a union of Caspian states, ripe with strategic and economic relevance, including tourism, Teheran is pushed in the arms of the continental powers by the suicidal policies of the West. Divide et impera, divide and rule, has been the leitmotiv of any empire since at least the times of the Romans. The US followed it rather carefully, for instance when they divided Russia from China under Nixon’s administration. Now they’re provoking China in Taiwan at the same time as they’re fighting a hybrid war with Russia in Ukraine, and with their imaginary third arm they believe to be able to overturn the Ayatollahs. Evidently, this hubris has since long divorced reason. The US could not deal the coup the grace in the ‘90s and early 2000s, when Russia and China were busy with their own problems if not actively helping the West. Imagining that it could succeed in after decades of internal decline, while fighting an emboldened decolonizing coalition, and at the same time pursuing contradictory attempts at détente to signal discontinuity with Trump is worse than preposterous. The SCO should reward #Iranianlivesmatter, #Iranrevolution, women cutting hairlocks worldwide and such as its most effective PR campaign.

However relevant, this is not even the most significant and impressive turn that has been taken in recent days. Even Western press could not ignore the “detail” that OPEC+, at its summit in Vienna, has brutally smashed US hopes to avoid a reduction in oil outputs in order to keep the prices low. After having played with his declarations, journalists challenged the Saudi representative, who ended up refusing to answer questions from Reuters. They probably did not get the memo that the imperial arrogance of the US is not swallowed with the same servility all the world over anymore. But most interestingly, the Saudis have also explained that they have not been convinced by Russia about the oil prices but are simply protecting their country’s economic interests. Even more outrageous to American ears! They speak of interests that are not our own! How dare they!

At this point, even Biden must be realizing that there were deeper reasons behind the Saudi prince’s decline of his phone call already in March, besides inflicting him and the American government the umpteenth humiliation on the world stage. Not only the US are finally given the brush-off in one of the most important regions of the world: the latter is actively being reshaped by the hatred of them. The Middle East connects three continents, including the two largest, not to mention oceans and seas, and by controlling its straits the Anglo-American have been able to choke the world economy for well over a century. Add the infamously rich resources of the region. It is no coincidence that the same Raymond Geuss considers the British loss of control of the Suez strait in 1956 as the end of their empire, more than the independence of India. Let’s not forget this was “facilitated” by Khrushchev’s threat at the UN to resort to missiles in case the colonial powers did not withdraw from Egypt.

The region continued to be torn apart by the West’s skillful exploitation of its ideological, social, national, and especially religious diversity: first of all, the conflict between Shia and Sunni Muslims. These are behind the most dramatic – and almost completely ignored – humanitarian crisis of our time: the devastation of Yemen.

It won’t be easy, but if the interests of such opposite countries as Saudi Arabia and Iran were to align, with a little help by American hostile resentment against the independence of both, and perhaps a friendly nudge by Russia (and China), this would be a massive blow to Western hegemony. Much more than the temporary occupation of I don’t know how many soccer fields in rural Ukraine.

Last but not least, let’s not forget the Americas. One of the most outspoken admirers of Russia, the Bolivarian Republic of Venezuela, is currently not represented at the Organization of the American States. Still, when the OAS voted on a resolution to condemn Russia’s referendums on October 7^th, Brazil, Argentina, and Mexico voted against.

Of course, in the perspective of the West’s rigged “democracy” the 24 states that voted in favor count more. But excepting the US and Canada for obvious reasons, the like of St. Kitts and Nevis are no match to the largest nations and economies of the continent. It’s the same logic why Biden’s bragging about a majority of states condemning Russia at the UN General Assembly is delusional: if three fourth of the countries actually voted in favor, among those abstaining there were India, China, Pakistan, Vietnam and other immense world players. Even more evident is the diplomatic defeat over the resolution to remove representatives of the Venezuelan opposition from the OAS: only the US, Canada, Guatemala and Paraguay voted against. The resolution didn’t pass, due to a significant number of abstainers and the requirement of a 2/3 majority, but is still a resounding slap in the US face in its very backyard.

So, while the heralds of the Empire are cheerfully selling us memes and Tik-Tok videos about the terrorist bonfire on the Crimea bridge, we still retain many and big reasons to nod in re-reading Putin’s diagnosis about the emergence of a free, sovereign, multipolar world and the end of Western hegemony being inevitable.

Jo Red is “lucky enough to be born in Italy: studied a lot, knows nothing”

Global finance vs global energy: who will come out on top?

October 13 2022

Photo Credit: The Cradle

In the war between global finance and energy, one fact remains clear: You can print money but you can’t print oil

There is more to the current struggle between the oil-consuming west and the oil-producing nations than meets the eye and it runs far deeper than the war in Ukraine

By Karin Kneissl

On 6 October, when the European Union (EU) agreed to impose a Russian oil price cap as part of a new package of sanctions against Moscow, 23 oil ministers from the OPEC+ group of oil-producing countries spoke out in favor of a sharp cut in their joint production quota.

Their collective decision to decrease output by about two million barrels of oil per day elicited strong reactions in the US in particular, and there was even talk of “declarations of war.” The EU feels duped, as the OPEC+ production cuts could drive up fuel prices and dampen their eight sanctions packages. Despite the narrative of the world edging toward a “post-oil era,” it seems there’s life in the old dog yet, as OPEC remains the talk of the town.

OPEC is as relevant as ever

OPEC and ten non-OPEC energy producers – including Russia – have been coordinating their production policy since December 2016. At the time, analysts gave this “OPEC-plus” format little chance of having an impact.

Back then, I recall the mockery of many who scorned the announcement in the press room of the OPEC General Secretariat in Vienna. But OPEC has weathered the storm of the global oil market in recent years, and has emerged as a key player.

Recall the exceptional situation in the spring of 2020 during the global COVID-19 pandemic lockdown, when futures trading for US oil grades were even quoted at negative prices at times, only to rise again to new heights in April 2021.

In contrast to the escapades in the oil market between 1973 and 1985, when there was little consensus among OPEC’s members and many had already written the organization’s obituary – today, former rivals such as Saudi Arabia and Russia are managing to converge their interests into powerful cards.

In those days, it was normal practice for Riyadh to take into account and execute Washington’s interests within OPEC: A single phone call from the US capital was enough. When the US oil company ARAMCO – which acted like an extended arm of the US in the kingdom – was nationalized by Saudi Arabia in the early 1970s as part of the sweeping nationalization trends around the world, compensation was promised to the US on a mere handshake.

The era of the “Seven Sisters,” a cartel of oil companies that divided up the oil market, came to an end then. However, for US policymakers – at least, psychologically – this era still persists. “It’s our oil,” is an expression I often hear uttered in Washington. Those voices were particularly loud during the illegal US-led 2003 invasion of Iraq.

Financial market versus the energy market

To really understand the core of the conflict in Ukraine – where a proxy war rages – one must break down the confrontation thus: The US and its European allies, who represent and back the global financial sector, are essentially engaged in a battle against the world’s energy sector.

In the past 22 years, we have seen how easy it is for governments to print paper currency. In just 2022, the US dollar has printed more paper money than in its combined history. Energy, on the other hand, cannot be printed. And therein lies a fundamental problem for Washington: The commodity sector can outbid the financial industry.

When I wrote my book “The Energy Poker” in 2005, I also dealt with the currency question, i.e. whether oil will be traded in US dollars in the long term. At the time, my interlocutors from the Arab OPEC countries unanimously said that the US dollar would not be changed. Yet, 17 years later, that view has devolved starkly.

Riyadh is warming up to the idea of trading oil in other currencies, as indicated this year in discussions with the Chinese to trade in yuan. The Saudis also continue to purchase Russian like other West Asian and Global South states, they have opted to ignore western sanctions on Moscow, and are increasingly preparing for the new international condition of multipolarity.

Washington, thus, no longer maintains its ability to exert absolute leverage on OPEC, which is now repositioning itself geopolitically as the enlarged OPEC+.

US reacts: Between defiance and anger

The OPEC+ ministerial meeting on 6 October was a clear foreshadowing of these new circumstances. The inherent tensions between two world views unfolded immediately in the post-meeting press room where a Saudi oil minister put the western news agency Reuters in its place, and where US journalists fiercely attacked OPEC for “holding the world economy hostage.”

The next day, a tough policy was grudgingly announced by the White House. The OPEC+ production cuts has Washington vacillating between sulking and seeking revenge – against the once-compliant Saudis, in particular. In a few weeks US midterm elections will be held, and the ramifications of spiking fuel prices will no doubt unfold at the ballot box.

For almost a year, President Joe Biden has been expanding US fuel supply via the Strategic Petroleum Reserve, but has been unable to calibrate either the price of oil or runaway inflation. The US Congress is threatening to use the so-called “NOPEC” bill – under the legal pretext of banning cartels – to seize the assets of OPEC governments.

The concept has been floating around for decades on Capitol Hill, but this time new irrational emotions may own the momentum. But hostile or threatening US actions are likely to backfire and even accelerate the geopolitical shifts taking place in West Asia, which has been edging out of the US orbit in recent years. Many Arab capitals have not forgotten the unseating of Egyptian President Hosni Mubarak in 2011, and how quickly the US abandoned its longterm ally.

“It’s the economy, stupid”

The price of oil is a seismograph of the world economy and also of global geopolitics. With the production cuts, OPEC+ is simply planning in anticipation of upcoming recessionary consequences. Moreover, some producing countries are failing to create new capacities in view of the investment gap that has persisted since 2014: a low price of oil simply cannot be sustained if there is no major capital investment in its sector.

The energy supply situation is expected to further worsen as of 5 December, when the oil embargo imposed by the EU comes into force.

The fundamental laws of supply and demand will ultimately determine the many distortions in the commodity markets. The anti-Russian sanctions created by the EU and other states (a total of 42 states) have disrupted global supply, and that has man-made supply and pricing consequences.

The two major global financial crises – real estate and banks in 2008, and the pandemic in 2020 – led to the excessive printing of paper money. Ironically, it was China that moved the paralyzed global economy out of the first crisis: Beijing stabilized the entire commodity market in 2009/10 by serving as the global locomotive and bringing the yuan into the trading schemes.

China, the well-oiled machine

Until the early 1990s, China satisfied its domestic oil consumption with domestic oil production, ranging from 3-4 million barrels per day. But fifteen years and a rapidly-expanded economy later, China had turned into the world’s number one oil importer.

This status reveals the crucial role of Beijing in the global oil market.  While Saudi Arabia and Angola are important oil providers, Russia is the main gas supplier for China. As former Premier Wen Jiabao once aptly observed: “any small problem multiplied by 1.3 billion will end up being a very big problem.”

For the past 20 years, I have argued that pipelines and airlines were moving east not west. Arguably, one of Russia’s biggest mistakes was to invest in infrastructure and contracts for a promising but ungrateful European market. The cancellation of the South Stream project in 2014 should have served as a lesson to Moscow not to enlarge Nord Stream as of 2017.  Times, nerves, and money could have been better spent on expanding the grid heading east.

It’s never been about Ukraine

Ever since the start of Ukraine’s military conflict in February 2022, we have essentially been watching the western-led financial industry waging its war against the eastern-dominated energy economy. The momentum will always be with the latter, because as stated above, in contrast to money, energy cannot be printed.

The oil and gas volumes needed to replace Russian energy sources cannot be found on the world market within a year. And no commodity is more global than oil. Any changes in the oil market will always influence the world’s economy.

“Oil makes and breaks nations.” It is a quote that epitomizes the importance of oil in shaping global and regional orders, as was the case in West Asia in the post-World War I era: First came the pipelines, then came the borders.

The late former Saudi oil minister Zaki Yamani once described oil alliances as being stronger than Catholic marriages. If that is the case, then the old US-Saudi marriage is currently undergoing estrangement and Russia has filed for divorce from Europe.

The views expressed in this article do not necessarily reflect those of The Cradle.

Russia courts Muslim countries as strategic Eurasian partners

Thursday, 13 October 2022 7:10 PM  [ Last Update: Friday, 14 October 2022 9:14 AM ]

Iranian President Ebrahim Raeisi (L) and Russian President Vladimir Putin (R) attend the CICA summit in Astana, Kazakhstan on October 13, 2022.

By Pepe Escobar

Everything that matters in the complex process of Eurasia integration was once again at play in Astana, as the – renamed – Kazakh capital hosted the 6th Conference on Interaction and Confidence-Building Measures in Asia (CICA).

The roll call was a Eurasian thing of beauty – featuring the leaders of Russia and Belarus (EAEU), West Asia (Azerbaijan, Turkey, Iraq, Iran, Qatar, Palestine) and Central Asia (Tajikistan, Uzbekistan, Kyrgyzstan).

China and Vietnam (East and Southeast Asia) attended at the level of vice presidents.

CICA is a multinational forum focused on cooperation toward peace, security, and stability across Asia.,Kazakh President Tokayev revealed that CICA has just adopted a declaration to turn the forum into an international organization.  

CICA has already established a partnership with the Eurasia Economic Union (EAEU). So in practice, it will soon be working together side-by-side with the SCO, the EAEU and certainly BRICS+.

The Russia-Iran strategic partnership was prominently featured at CICA, especially after Iran being welcomed to the SCO as a full member.

President Raeisi, addressing the forum, stressed the crucial notion of an emerging  “new Asia”, where “convergence and security” are “not compatible with the interests of hegemonic countries and any attempt to destabilize independent nations has goals and consequences beyond national geographies, and in fact, aims to target the stability and prosperity of regional countries.”

For Tehran, being a partner in the integration of CICA, within a maze of pan-Asia institutions, is essential after all these decades of”maximum pressure” unleashed by the Hegemon.

Moreover, it opens an opportunity, as Raeisi noted, for Iran to profit from “Asia’s economic infrastructure.”

Russian President Vladimir Putin, predictably, was the star of the show in Astana. It’s essential to note that Putin is supported by “all”nations represented at CICA.

High-level bilaterals with Putin included the Emir of Qatar: everyone that matters in West Asia wants to talk to “isolated” Russia.      

Putin called for “compensation for the damage caused to the Afghans during the years of occupation” (we all know the Empire of Chaos, Lies and Plunder will refuse it), and emphasized the key role of the SCO to develop Afghanistan.

He stated that Asia, “where new centers of power are growing stronger, plays a big role in the transition to a multipolar world order”.

He warned, “there is a real threat of famine and large-scale shocks against the backdrop of volatility in energy and food prices in the world.”

Hefurther called for the end of a financial system that benefits the “Golden billion” – who “live at the expense of others” (there’s nothing “golden” about this “billion”: at best such definition of wealth applies to 10 million.)

And he stressed that Russia is doing everything to “form a system of equal and indivisible security”. Exactly what drives the hegemonic imperial elites completely berserk.

“Offer you can’t refuse” bites the dust

The imminent juxtaposition between CICA and the SCO and EAEU is yet another instance of how the pieces of the complex Eurasia jigsaw puzzle are coming together.

Turkey and Saudi Arabia – in theory, staunch imperial military allies – are itching to join the SCO, which has recently welcomed Iran as a full member. 

That spells out Ankara and Riyadh’s geopolitical choice of forcefully eschewing the imperial Russophobia cum Sinophobia offensive.  

Erdogan, as an observer at the recent SCO summit in Samarkand, sent out exactly this message. The SCO is fast reaching the point where we may have, sitting at the same table, and taking important consensual decisions, not only the “RICs” (Russia, India, China) in BRICS (soon to be expanded to BRICS+) but arguably the top players inMuslim countries: Iran, Pakistan, Turkey, Saudi Arabia, Egypt and Qatar.

This evolving process, not without its serious challenges, testifies to the concerted Russia-China drive to incorporate the lands of Islam as essential strategic partners in forging the post-Western multipolar world. Call it a soft Islamization of multipolarity.  

No wonder the Anglo-American axis is absolutely petrified.

Now cut to a graphic illustration of all of the above – the way it’s being played in the energy markets: the already legendary Opec+ meeting in Vienna a week ago.

A tectonic geopolitical shift was inbuilt in the – collective – decision to slash oil production by 2 million barrels a day.

The Saudi Foreign Ministry issued a very diplomatic note with a stunning piece of information for those equipped to read between the lines.

For all practical purposes, the combo behind the teleprompter reader in Washington had issued a trademark Mafia threat to stop “protection” to Riyadh if the decision on the oil cuts was taken before the US mid-term elections. 

Only this time the “offer you can’t refuse” didn’t bite. OPEC+ made a collective decision, led by Russia, Saudi Arabia and the UAE. 

Following Putin and MBS famously getting along, it was up to Putin to host UAE President Sheikh Zayed – or MBZ, MBS’s mentor – at the stunning Konstantinovsky Palace in St. Petersburg, which datesback to Peter the Great.

That was a sort of informal celebration of how OPEC+ had provoked, with a single move, a superpower strategic debacle when it comes to the geopolitics of oil, which the Empire had controlled for a century. 

Everyone remembers, after the bombing, invasion and occupation of Iraq in 2003, how US neo-cons bragged, “we are the new OPEC”.

Well, not anymore. And the move had to come from the Russians and US Persian Gulf “allies” when everyone expected that would happen the day a Chinese delegation lands in Riyadh and asks for payment of all the energy they need in yuan.

OPEC+ called the American bluff and left the superpower high’n dry. So what are they going to do to “punish” Riyadh and Abu Dhabi? Call CENTCOM in Qatar and Bahrain to mobilize their aircraft carriers and unleash regime change?

What’s certain is that the Straussian/neocon psychos in charge in Washington will double down on hybrid war.

The art of “spreading instability”

In St. Petersburg, as he addressed MBZ, Putin made it clear that it’s OPEC+ – led by Russia, Saudi Arabia and the UAE – that is now setting the pace to “stabilize global energy markets” so consumers and suppliers would “feel calm, stable and confident” and supply and demand “would be balanced”.

On the gas front, at Russian Energy Week, Gazprom CEO Alexey Miller made it clear that Russia may still “save” Europe from an energy black hole.

Nord Stream (NS) and Nord Stream 2 (NS2) may become operational: but all political roadblocks must be removed before any repairing work starts on the pipelines.

And on West Asia, Miller said additions to Turk Stream have already been planned, much to the delight of Ankara, keen to become a key energy hub. 

In a parallel track, it’s absolutely clear that the G7’s desperate gambit of imposing an oil price cap – which translates as the weaponization of sanctions extended to the global energy market – is a losing proposition.

Slightly over a month before hosting the G20 in Bali, Indonesian Finance Minister Sri Mulyani Indrawati could not make it clearer: “When the United States is imposing sanctions using economic instruments, that creates a precedent for everything”, spreading instability “not only for Indonesia but for all other countries.”

Meanwhile, allMuslim-majority countries are paying very close attention to Russia. The Russia-Iran strategic partnership is now advancing in parallel to the Russia-Saudi-UAE entente as crucial vectors of multipolarity.

In the near future, all these vectors are bound to unite in what ideally should be a supra-organization capable of managing the top story of the 21^st century: Eurasia integration.    

Pepe Escobar is a veteran journalist, author and independent geopolitical analyst focused on Eurasia.

(The views expressed in this article are the author’s own and do not necessarily reflect those of Press TV.)

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Oil cuts: A perfect storm in US foreign policy

The Biden administration’s poor dealings with oil producing countries will have major political and economic ramifications for the west

October 11 2022

By MK Bhadrakumar

The old adage is that a good foreign policy is the reflection of the national policy. In this sense, a perfect storm is brewing on the foreign policy front in the US, triggered by the OPEC decision on 5 October to cut oil production by 2 million barrels a day.

On the one hand, this will drive up the gas price for the domestic consumer and on the other, will expose the US administration’s lop-sided foreign policy priorities. 

At its most obvious level, OPEC’s move confirms the belief that Washington has lost its leverage with the cartel of oil-producing countries. This is being attributed to the deterioration of the US’ relations with Saudi Arabia during the presidency of Joe Biden. But, fundamentally, a contradiction has arisen between the US interests and the interests of the oil producing countries.

Petro-diplomacy

That being said, contradictions are nothing new to the geopolitics of oil: the 1970s and 1980s witnessed two major “oil crises.” One was man-made while the other was an interplay of historical forces — the Yom-Kippur War of 1973 and Iran’s Islamic Revolution of 1979. In the downstream of the former, the Arab nations weaponized oil and proclaimed an oil embargo on western nations which were perceived to have supported Israel in the war.

The result was that the price of oil rose nearly 300 percent in less than six months, crippling the world’s economy. In the US, President Richard Nixon asked petrol stations not to sell gasoline from Saturday night through until Monday morning to cope with the crisis, which affected industry more than the average consumer.

In 1979, the Iranian Revolution hit oil production rates and the world’s oil supply shrunk by 4 percent. As panic set in, demand for crude oil shot up and prices more than doubled.

Biden’s folly

The Biden administration has tempted fate by underestimating the importance of oil in modern diplomacy, and ignoring that oil will remain the dominant energy source across the world for the foreseeable future, powering everything from cars and domestic heating to huge industry titans and manufacturing plants.

Even the steady transition to green energy over time is largely dependent on the continued availability of plentiful, cheap fossil fuel. However, the Biden administration overlooked the fact that those who have oil reserves wield a huge amount of power over our oil-centered energy systems, while those who buy oil are, on the contrary, cripplingly dependent on the market and the diplomatic relations which drive it.

The western powers are far too naive to think that an energy superpower like Russia can be simply “erased” from the ecosystem. An “energy war” with Russia is therefore destined for failure.

Historically, western nations understood the imperative to maintain good diplomatic relations with oil-producing countries. But Biden threw caution into the wind by insulting Saudi Arabia – when in the run-up to the 2020 presidential elections, he vowed to make the kingdom a “pariah” state.

Despite his highly-publicized visit to Jeddah in July 2022 to mend fences, the Saudis distrust American intentions, and we are unlikely to see any improvement in US-Saudi relations under Biden’s administration.

The congruence of interests on the part of the OPEC to keep the prices high is essentially because they need the extra income for their expenditure budget and to maintain a healthy investment level in the oil industry. The International Monetary Fund (IMF) in April projected Saudi Arabia’s breakeven oil price — the oil price at which it would balance its budget — at $79.20 a barrel.

Although the Saudi government does not disclose its assumed breakeven oil price, a Reuters report suggested that a preferred price level would be around $90 to $100 a barrel for Brent crude — at which level, it won’t have a huge impact on the global economy. Of course, anything over $100 will be a windfall.

Dictating who can and can’t sell oil

Meanwhile, a “systemic” crisis is brewing. It is only natural that OPEC views with skepticism the recent moves by the US and the EU to curtail Russia’s oil exports. The west rationalizes these moves as being aimed at drastically reducing Russia’s revenues from oil exports (which translates into resilience to fight the war in Ukraine.)

The latest G7 move to put a cap on the prices at which Russia can sell its oil is taking matters to an extreme.

OPEC regards price caps as a paradigm shift, as it implicitly challenges the cartel’s assumed prerogative to ensure that global oil supply matches demand, where one of the key measures of supply-demand balance is price. Arguably, the west is de facto setting up a rival cartel of oil-consuming countries to regulate the oil market.

No doubt, the west’s move is precedent-setting — namely, to prescribe for geopolitical reasons the price at which an oil-producing country is entitled to export its oil. If it is Russia today, who is to say it will not be Saudi Arabia or Iraq tomorrow? The G7 decision – if it gets implemented – will erode OPEC’s key role regulating the global oil market.

OPEC fights back

As such, OPEC is proactively pushing back with its recent decision to cut down oil production by 2 million barrels per day and keep the oil price above $90 per barrel. OPEC estimates that Washington’s options to counter OPEC+ are limited. Unlike in the past energy history, the US does not have a single ally today inside the OPEC+ group.

Due to rising domestic demands for oil and gas, it is entirely conceivable that the US exports of both items may be curtailed. If that happens, Europe will be the worst affected. In an interview with the Financial Times last week, Belgian Prime Minister Alexander De Croo warned that as winter approaches, if energy prices are not brought down, “we are risking a massive deindustrialization of the European continent and the long-term consequences of that might actually be very deep.”

He added these chilling words: “Our populations are getting invoices which are completely insane. At some point, it will snap. I understand that people are angry . . . people don’t have the means to pay it.” De Croo was warning about the likelihood of social unrest and political turmoil in European countries.

The economic and political fallout

Without a doubt, this is a tectonic shift in geopolitics which may probably turn out to be more important than the conflict in Ukraine in the making of the multipolar world order.

This perfect storm in Biden’s foreign policy can also impact the US midterm elections in November and deliver a Republican majority in the Senate, which could set the tempo for the 2024 US presidential election.

The Kremlin’s spokesman Dmitry Peskov has said that by turning away from Russian energy, Europe has become a captive market for the US oil companies which are now making “crazy money,” but the high cost of it is draining away the competitiveness of the European economy.

“Production is collapsing. Deindustrialization is coming. All this will have very, very deplorable consequences for the European continent over probably, at least, the next 10-20 years,” Peskov said.

Incidentally, Russia stands to gain the most from OPEC+cuts. The expert opinion is that oil prices will move higher from current levels through year-end and next year. That is to say, Russia will not cut any output while the price of oil is set to rise in the coming months.

As oil prices rise, Russia will not have to cut even a barrel of its production so long as it has a big enough market after December to sell the crude now going to Europe. Again, Moscow, for its part, reiterates that it will not supply oil to countries that would join the G7 price cap. In doing so, it is matching the Biden administration’s non-market instruments.

The views expressed in this article do not necessarily reflect those of The Cradle.

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US Senator Sanders Calls for Troop Withdrawal from Saudi Arabia, End of Selling Weapons

October 8, 2022

By Staff, Agencies

Independent US Senator and former Democratic presidential candidate Bernie Sanders has called for the withdrawal of American troops from Saudi Arabia and an end to military aid to the conservative kingdom for lowering oil production.

“If Saudi Arabia, one of the worst violators of human rights in the world, wants to partner with Russia to jack up US gas prices, it can get Putin to defend its monarchy,” the Vermont senator tweeted Friday after the OPEC+ bloc announced a cut in daily oil production.

“We must pull all US troops out of Saudi Arabia, stop selling them weapons & end its price-fixing oil cartel,” he added.

In August, the United States approved massive arms sales to Saudi Arabia and the United Arab Emirates worth more than $5 billion, amid criticism of their ongoing military aggression in Yemen which has inflicted heavy civilian casualties.

The State Department said Saudi Arabia would buy 300 Patriot MIM-104E missile systems and related equipment for an estimated $3.05 billion. The missile systems can be used to shoot down long-range incoming ballistic and cruise missiles, as well as fighter jets.

Separately, the United States will sell Terminal High Altitude Area Defense [THAAD] System Missiles and related equipment to the UAE for $2.25 billion.

Saudi Arabia and other members of OPEC-PLUS, which groups up the Organization of the Petroleum Exporting Countries and other producers including Russia, announced this week it would cut oil production to prop up falling prices.

“Saudi Arabia’s crown prince ordered the murder of a Washington Post columnist with a bone saw. Its disastrous war in Yemen has led to the deaths of 377,000 people and a humanitarian crisis. It’s now siding with Russia to damage our economy. Our support for Saudi Arabia must end,” Sanders tweeted on Friday.

Sanders also expressed similar feelings on Wednesday when he said the US “must end OPEC’s illegal price-fixing cartel, eliminate military assistance to Saudi Arabia, and move aggressively to renewable energy.”

The No Oil Producing and Exporting Cartels Act of 2021, or the NOPEC bill prohibits a foreign state from engaging in collective action impacting the market.

The NOPEC bill allows the US Attorney General to sue companies such as Saudi Aramco in federal court. 

In a related move, a group of lawmakers has introduced a new bill that aims to end the US’ military support to Saudi Arabia.

House Representatives Tom Malinowski, Sean Casten and Susan Wild launched the motion on Wednesday.

“We see no reason why American troops and contractors should continue to provide this service to countries that are actively working against us,” they said.

Several congressional Democrats have had similar remarks on the announcement, which is poised to counter sanctions on Russian oil and potentially drive up gas prices ahead of the midterm US elections.

US Senate Majority Leader Charles Schumer rebuked Saudi Arabia. The senior Democratic senator from New York threatened Saudi Arabia, saying Riyadh will pay the price for what he called its “deeply cynical action” of supporting a 2 million-barrel cut in oil supplies, which will put more pressure on the American economy.

 “What Saudi Arabia did to help Putin continue to wage his despicable, vicious war against Ukraine will long be remembered by Americans. We are looking at all the legislative tools to best deal with this appalling and deeply cynical action, including the NOPEC bill,” Schumer tweeted on Friday.

Legislation introduced in the House by Representatives Sean Casten [D-Ill.], Tom Malinowski [D-N.J.] and Susan Wild [D-Pa.] would remove American troops and military hardware from Saudi Arabia and the United Arab Emirates.

The number two Democrat in the Senate, Senator Dick Durbin, also demanded the passage of the legislation this week, and voiced support for a broader reevaluation of the Washington-Riyadh relationship, specifically seeking “unanswered questions” about the role of the Saudi state in the 9/11 attacks.

“The Saudi royal family has never been a trustworthy ally of our nation,” Durbin said Thursday. “It’s time for our foreign policy to imagine a world without this alliance with these royal backstabbers.”

Families of victims of the attacks have for years pushed the US government to declassify and make public more information about 9/11, which was a series of strikes that killed nearly 3,000 people and caused about $10 billion worth of property and infrastructure damage in the United States.

US officials assert that the attacks were carried out by 19 al-Qaeda terrorists but many experts and independent researchers have raised questions about the official account.

They believe that rogue elements within the US government, such as former Vice President Dick Cheney, orchestrated or at least encouraged the 9/11 attacks in order to accelerate the US war machine and advance the Zionist agenda.

Certain documents related to the FBI’s investigation of 9/11 reportedly contain evidence of Saudi involvement in the strikes.

Successive US administrations have refused to release the classified documents because they reportedly could expose a potential link between Saudi Arabia and the 9/11 attacks. Fifteen out of 19 alleged 9/11 attackers were Saudi nationals.

Several US senators and House lawmakers have been calling for the disclosure of 28 pages that purportedly contain evidence of Saudi involvement in financing and backing the alleged 9/11 hijackers. The pages were extracted from a 2002 Congressional inquiry into the September 11, 2001 attacks.

Irate US officials ‘weigh response’ against Saudi Arabia for OPEC+ cut

October 07 2022

Lawmakers have called on the White House to slash military sales to Saudi Arabia, professing a sudden concern for the US-sponsored war in Yemen

(Photo credit: Drew Angerer/Getty Images)

ByNews Desk

US State Secretary Antony Blinken said on 6 October that Washington is reviewing various options regarding its relationship with Saudi Arabia after the decision by OPEC+ nations to cut oil production levels by two million barrels per day (bpd).

“As for the relationship [with Riyadh] going forward, we’re reviewing a number of response options. We’re consulting closely with Congress,” Blinken said during a visit to Peru on Thursday.

But while he failed to detail any of the steps being considered in response to what many called a humiliating blow for US President Joe Biden, the state secretary did say Washington “would not do anything that infringes upon its interests.”

The decision to significantly cut production levels by OPEC+ – a group of OPEC and non-OPEC nations that includes Russia – was allegedly made to prevent a crash in the energy market by driving up oil prices.

In the hours ahead of Blinken’s comments, Democrat lawmakers in the US congress called to slash military sales to Saudi Arabia, professing a sudden concern for the brutal war in Yemen – which Washington has been fueling since 2015.

“I think it’s time for a wholesale re-evaluation of the US alliance with Saudi Arabia,” Senator Chris Murphy, chairman of the Senate foreign relations subcommittee on West Asia, told CNBC.

Representative Ruben Gallego, meanwhile, suggested Washington once again take back Patriot missile defense systems deployed in Saudi Arabia. “If they like the Russians so much they can use their very ‘reliable’ military technology,” Gallego said on Twitter.

Saudi Arabia is the largest customer of US-made military equipment, with billions of dollars in orders approved by the State and Defense departments every single year.

During the 2020 presidential campaign, Biden promised to end military support for Saudi Arabia’s brutal war in Yemen.

However, he has failed to keep his promises, whitewashing the atrocious human rights records of both Saudi Arabia and Israel, and even considering lifting a ban on selling “offensive weapons” to the kingdom.

Washington has recently increased its military presence in Yemen, in what officials say is an attempt to control the country’s oil fields as it does in Syria.

But despite Biden’s bid to keep the US as the largest exporter of weapons in the world, a recent poll by the Eurasia Group Foundation (EGF) shows that the majority of young US citizens – aged 18 to 29 – are opposed to the continued supply of US weapons to Saudi Arabia and Israel.

US accuses Opec+ of aligning with Russia, Gulf states deny politics at play

UAE says production cut was ‘technical and not political’, but Washington says it is exploring ways to reduce Opec’s control over energy prices

By MEE staff  in New York City

Published date: 5 October 2022 16:02 UTC   Last update: 9 hours 44 mins ago

Saudi Energy Minister Prince Abdulaziz bin Salman bin Abdulaziz Al Saud (R) and Iraqi Oil Minister Ihsan Abdul-Jabbar Ismail, arrive at the 29th annual Middle East Petroleum and Gas conference in the Bahraini capital Manama on May 16, 2022 (AFP)

Ministers from a group of oil exporting countries led by Saudi Arabia and Russia agreed on Wednesday to slash output by two million barrels a day, prompting pushback from the US and igniting fears that it could propel global inflation higher. 

The decision came despite heavy lobbying by Washington in Gulf capitals against the move. 

“It’s clear that Opec+ is aligning with Russia with today’s announcement,” White House press secretary Karine Jean-Pierre said aboard Air Force One.

“The president is disappointed by the shortsighted decision of Opec+,” national security advisor Jake Sullivan and top economic advisor Brian Deese said in a statement.

‘Tell me where is the act of belligerence’

 – Abdulaziz bin Salman, Saudi energy minister

The cut, equivalent to two percent of daily global supply, was proposed by the Saudi-led Organization of the Petroleum Exporting Countries and Russia at Wednesday’s Opec+ meeting in Vienna. It is substantially higher than the one million barrels analysts had expected, and the biggest cut since April 2020.

Saudi Arabia and Russia aim to support prices amid signs that the global economy is slowing, with the possibility of a recession on the horizon. Oil prices usually drop when global economic growth slows.

The decision to cut production is likely to put pressure on relations between the US and Saudi Arabia, with Wednesday’s move seen as a win for Russia, particularly as it has faced battlefield losses in Ukraine, and reduced revenue from falling oil prices in recent weeks.

‘Technical and not political?’

US President Joe Biden visited Saudi Arabia in July, in a bid to repair strained ties with Saudi Arabia. Shortly after meeting with Saudi rulers, including Crown Prince Mohammed bin Salman, Biden said he expected Riyadh to take “further steps” to boost oil supply.

The backlash against Wednesday’s production cut has already appeared in some quarters of Washington. 

US Democratic Senator Chris Murphy, a noted critic of Saudi Arabia, said the Opec+ decision should lead to “a wholesale re-evaluation of the US alliance with Saudi Arabia”.

Read More »
Gulf states are pushing back against that narrative.

Saudi Arabia set to support Russia’s role in Opec+ despite looming sanctions

“Tell me where is the act of belligerence,” Saudi energy minister Prince Abdulaziz bin Salman said during a news conference at Opec’s headquarters in Vienna, when asked if the cut would strain ties with the US.

“We shall act and react to what is happening to the global economy in the most responsible and responsive way.”

The energy minister of the United Arab Emirates, Suhail al-Mazrouei, said the cut in production was “technical and not political”.

OPEC Secretary-General Haitham Al Ghais, from Kuwait said the cartel was trying to ensure “security [and] stability to the energy markets.”

“Everything has a price,” Ghais said. “Energy security has a price as well.”

Recession headwinds

Oil prices skyrocketed above $100 a barrel earlier this year after Russia invaded Ukraine.

While they have fallen about 32 percent from their highs over the past four months, the drop has been due mainly to fears of slowing economic growth – particularly in China – as opposed to increased production.

Some say Riyadh needs little motivation outside of economics to back the production cut.

“Saudi Arabia sees a recession coming next year and they don’t want to be stuck with millions of barrels of cheap oil. They see now as the time to get the best price,” a former senior US official told Middle East Eye, on condition of anonymity. 

Egypt and Qatar find ‘synergies’ in post-Ukraine Middle East Read More »

Read More »

The kingdom’s coffers have been buoyed by high crude prices. Earlier this year, Saudi Aramco overtook Apple as the world’s most valuable company.

Saudi Arabia is expected to be one of the world’s fastest-growing economies this year, and is using its oil wealth to push ahead with pro-business reforms and mega-projects such as Neom, designed to wean the country off its reliance on petrodollars.

And with an inflation rate of 2.8 percent, the oil-rich kingdom has also been more insulated from the price rises that are sweeping the globe – a hot-button political issue for Biden’s party in the November midterm elections. 

‘Reduce Opec’s control’

In response to Wednesday’s decision, Biden called on his administration and US Congress to explore ways to “boost US energy production and reduce Opec’s control over energy prices,” the White House said.

The statement said Biden was ordering another dip into the country’s Strategic Petroleum Reserve, with 10 million barrels set to be put on the market next month, in an attempt to dampen price rises.

However, those reserves are fast emptying after record withdrawals were ordered by the administration, starting back in March. The reserves are now at their lowest level since July 1984, and it is not clear when the administration plans to purchase a refill.

Turkey doubles Russian oil imports amid western sanctions Read More »

Oil prices had risen about five percent since Friday, in anticipation of Wednesday’s meeting. International benchmark Brent was up 1.86 percent, at $93.47 a barrel Wednesday morning.

Analysts say the cut was likely to hinder western countries’ efforts to cut Russia’s profits on oil sales. The European Union has moved towards agreeing a G-7 plan to cap the price paid for Russian oil.

Also on Wednesday, European Commission President Ursula von der Leyen called for EU countries to make deeper cuts to gas demand, while proposing a raft of price cap measures designed to protect consumers and businesses.   

In September, Russia cut gas supplies to Europe via the Nord Stream 1 pipeline in response to Western sanctions. Soaring energy prices have prompted Europe to look to alternative suppliers of gas, including Israel, Egypt, Algeria and Qatar to fill the void left by Russia. 

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OPEC+ confirms oil production cut

5 Oct, 2022 15:02

The biggest output reduction since early 2020 has come despite US pressure to pump more

© Getty Images / Mlenny

OPEC+ member states have agreed an oil production cut of two million barrels per day, a statement published on the group’s website reads.

The reduction, which is the largest cut since early 2020, will take effect in November, the cartel announced on Wednesday.

According to OPEC, the step comes “in light of the uncertainty that surrounds the global economic and oil market outlooks, and the need to enhance the long-term guidance for the oil market, and in line with the successful approach of being proactive, and preemptive, which has been consistently adopted” by the group.

The cuts are much harsher than most experts had anticipated earlier this week, and are now expected to stem the latest drop in global prices for crude.

Energy ministers from the OPEC+ group led by Saudi Arabia and its allied non-members, including Russia, have held a meeting at the cartel’s Vienna headquarters on Wednesday for the first time since the start of the pandemic in early 2020.

READ MORE: Washington ‘panicking’ over potential Russian and Saudi oil cut – CNN

The decision on output reduction comes despite intense lobbying by the White House to keep oil production at current levels or higher – something US President Joe Biden had hoped to secure during his visit to Saudi Arabia in July.

On Tuesday, CNN cited an unnamed senior official as saying that Washington had mobilized all available resources ahead of the oil cartel gathering, with the Biden administration “having a spasm and panicking.” The efforts were described as “taking the gloves off.” Some of the talking points drafted by the US administration suggested the potential cut would be viewed as “a hostile act” and a “total disaster.”

Meanwhile, most officials from OPEC+ member states said any reduction would be a “technical, not a political decision” and cited a “risk of recession” as contributing to the cuts, as they entered the OPEC headquarters in Vienna.

Suhail Al Mazrouei, the energy minister of the United Arab Emirates (UAE), said that OPEC+ is a “technical organization,” when asked whether the proposal would potentially damage relations with the US.

For more stories on economy & finance visit RT’s business section

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EU Pushes For More Sanctions Which Will Come Back To Bite It

October 5, 2022

On February 22, two days before Russian troops entered the Ukraine, the U.S. and the EU put reams of sanctions onto Russia. They also confiscated some $300 billion of Russia’s reserves that were invested in the ‘west’. The sanctions had been negotiated between the EU and the U.S. and prepared for over several months.

The idea was to bankrupt Russia within a few weeks. The deluded people behind those sanctions had no idea how big and sanctions proved Russia’s economy really is. The sanctions failed to influence Russia in any way but their consequences led to a shortfall of energy in Europe and increased the already high inflation rates. Inflation in Russia is sinking and its general economic numbers are good. The now higher energy prices generate sufficient additional income to completely finance its war efforts.

A sane actor would conclude that the sanctions were a mistake and that lifting them would help Europe more than it would help Russia. But no, the U.S. and European pseudo elites are no longer able to act in a sane manner. They are instead doubling down with the most crazy sanction scheme one has ever heard of:

[T]he European Union pushed ahead on Wednesday with an ambitious but untested plan to limit Russia’s oil revenue.
…
If the global price of oil remains high, it would complicate the European Union’s effort to impose a price cap on Russian oil that was expected to gain final approval on Thursday, after E.U. negotiators reached an agreement on the measure as part of a fresh package of sanctions against Moscow.

Under the plan, a committee including representatives of the European Union, the Group of 7 nations and others that agree to the price cap would meet regularly to decide on the price at which Russian oil should be sold, and that it would change based on the market price.

Several diplomats involved in the E.U. talks said that Greece, Malta and Cyprus — maritime nations that would be most affected by the price cap — received assurances that their business interests would be preserved, the diplomats said.

The countries had been holding up what would be the eighth sanctions package the European Union has adopted since the Russian invasion of Ukraine because of worries that a price cap on Russian oil exported outside the bloc would affect their shipping, insurance and other industries, the diplomats said.

With oil prices at a high, Russia is raking in billions of dollars in revenue, even as it sells smaller quantities. The cap — part of a broad plan pushed by the Biden administration that the G7 agreed to last month — is intended to set the price of Russian oil lower than where it is today, but still above cost. The U.S. Treasury calculates that the cap would deprive the Kremlin of tens of billions of dollars annually.

How do you make a big producer of a rare commodity sell those goods below the general market price? Unless you have a very strong buyers cartel that can also that product from elsewhere you can not do this successfully. It is an economic impossibility.

To make the measure effective, and cut Russian revenue, the United States, Europe and their allies would need to convince India and China, which buy substantial quantities of Russian oil, to purchase it only at the agreed upon price. Experts say that even with willing partners, the cap could be hard to implement.

Russia has declared that it will not sell any oil to any party that supports the G7 price fixing regime. That is why neither China nor India nor any other country besides the EU and U.S. will agree to adhere to it.

The whole idea is crazy and way too complicate to achieve anything:

Under the new rules, companies involved in the shipping of Russian oil — including shipowners, insurers and underwriters — would be on the hook for ensuring that the oil they are helping to transport is being sold at or below the price cap. If they are caught helping Russia sell at a higher price, they could face lawsuits in their home countries for violating sanctions.

Russian crude will come under an embargo in most of the European Union on Dec. 5, and petroleum products will follow in February. The price cap on shipments to non-E.U. countries has been championed by U.S. Treasury Secretary Janet Yellen as a necessary complement to the European oil embargo.

Under the E.U. deal, Greece, Malta and Cyprus will be permitted to continue shipping Russian oil. Had they not agreed to place their companies at the forefront of applying the price cap, they would have been forbidden from shipping or insuring Russian oil cargo outside the European Union, a huge hit for major industries.

More than half of the tankers now shipping Russia’s oil are Greek-owned. And the financial services that underpin that trade — including insurance, reinsurance and letters of credit — are overwhelmingly based in the European Union and Britain.

This is of course an open invitation to other countries to enter the oil shipping and related financial services businesses at the cost of European companies.

China and India will both it to increase their market shares in those fields. Their ships will transport Russian oil to whoever wants to buy it for the market price minus the always negotiable Russian rebate. Greek ships will sit idle or will be sold off while Indian and Chinese and other Asian tankers will be very, very busy. China’s big insurance companies will happily join that new global services business.

That European bureaucrats agreed to his stupid U.S. idea, which will foremost hurt European businesses, is another sign that Brussels has given up on having any agency.

Today OPEC+ countries, the seller cartel for oil, reacted to the crazy sanctions idea and the upcoming global depression by agreeing to decrease their daily output by 2 million barrels. This was not done out of Saudi solidarity with Russia. Saudi Arabia needs oil at above $80/bl to finance its budget.

Brent Crude, which had fallen to $83/bl on September 26, has since risen to $93/bl.

The global demand for oil is around 100 million barrels per day. Should the demand stay up the 2% reduction in OPEC+ production will have significant price effects and $100 per barrel will be in easy reach.

But OPEC+ is committed to stable prices, not to significant price increases. During the OPEC+ session today the Saudi Prince Abdulazis showed this table:
bigger

Since the beginning of the year the prices for all forms of carbon based energy except crude oil have increased considerably. Abdulazis argued that the chart shows that OPEC+ is managing oil prices responsibly. The EU is certainly not doing similar.

The Biden administration has meanwhile nearly halved the content of the U.S Strategic Petroleum Reserve. This to keep U.S. pump prices down and the Democrats in power.
bigger

Neither is a responsible step to take.

Posted by b on October 5, 2022 at 16:48 UTC | Permalink

Iran and the Persian Gulf monarchies: Diplomacy remains their only option

Reconciliation between Iran and the GCC will reap vast mutual benefits, while conflict only serves those outside the Persian Gulf

September 07 2022

Photo Credit: The Cradle

By Mohammad Salami

In mid-August, Gulf Cooperation Council (GCC) member states the UAE and Kuwait announced the return of their respective ambassadors to Iran after a six year hiatus.

The move represents the latest sign of warming ties between Iran and the Persian Gulf sheikhdoms since the controversial execution of prominent, outspoken, Saudi Shia cleric Sheikh Nimr Al-Nimr in 2016 interrupted relations.

Nimr’s killing prompted angry protestors to storm the Saudi diplomatic mission in Tehran, leading to a concerted action by several GCC states to sever or downgrade relations with the Islamic Republic.

The reconciliation of two GCC countries with Iran last month was a result of negotiations stretching back several years. These advances also come amid on-going – sometimes stalled – talks between Tehran and Riyadh, hosted by neutral mediators in Baghdad. So far, five rounds of discussions have been held, with the last one held in April and a sixth one looming on the horizon.

Deescalation and diplomacy

Over the past two years, tensions in the Persian Gulf region deescalated as regional states began to seek alternative options to wind down their various proxy fights in West Asia.

The UAE has been at the forefront of these efforts, normalizing relations with Syria – another battleground against Iran – and agreeing to reset relations with Turkey last year after a decade of divergent ideological stances over the wider region.

Following Abu Dhabi’s lead, Riyadh also markedly improved its own relations with Ankara after Turkish President Recep Tayyip Erdogan’s two-day trip to Saudi Arabia, which was reciprocated by Crown Prince Mohammed Bin Salman’s (MbS) visit to the Turkish capital in June.

Most important for the region, however, is the thorny issue of the longstanding, mutually-perceived threat between Iran and the ‘Saudi camp’ within the GCC. For various reasons, including defeats and setbacks in Syria and nearby Yemen, Iran’s Arab neighbors have come to realize that the continuation of hostilities with Tehran is no longer in their national security interest.

“[Iran and Saudi Arabia] are neighbors. Neighbors forever. We cannot get rid of them, and they can’t get rid of us. So, it’s better for both of us to work it out and to look for ways in which we can coexist,” MbS said in an abrupt about-turn earlier this year.

Such conciliatory views are shared by Tehran, as conveyed by Iran’s foreign ministry spokesman Nasser Kanani who told reporters on 22 August: “We are optimistic that a positive regional atmosphere is fostering a path of communication and dialogue, and ultimately better relations.”

Rapprochement between Iran and the UAE was preceded by a similar trajectory; after four years of negotiations and five phone calls between Emirati Foreign Minister Sheikh Abdullah Bin Zayed and his Iranian counterpart Hossein Amir-Abdollahian, the two countries concluded that their interests can be better resolved through dialogue.

“Short of confronting Iran, it is wiser to reach out to Mr. [Ebrahim] Raisi. One way to deal with Iran is to continue the conversation and find common ground for good neighborly relations,” AbdulKhaleq Abdulla, the former advisor to the UAE government wrote in an opinion article, in reference to the Iranian president.

The diplomatic moves make sense considering that the UAE and Iran are economically interdependent; trade between Iran and the UAE is extensive, and Abu Dhabi is the largest exporter of goods to Iran. It is worth noting that despite tensions between the two countries, trade never completely ceased during the toughest times.

Motivating factors

Several factors have motivated this wholesale revision of policies towards Iran. Chief among these is the concern that GCC states can no longer depend on unconditional protection from unreliable allies outside the region.

Certainly, US President Joe Biden’s focus on reentering the Joint Comprehensive Plan of Action (JCPOA) nuclear agreement with Iran – unilaterally abandoned by his predecessor – is a strong indicator that Washington seeks to defuse its own decades-long standoff with Tehran to address more pressing national security priorities elsewhere.

As the US military and foreign policy establishments recalibrate their focus onto major peer adversaries like China and Russia, Washington has reduced its defense and security commitment to its long-time allies in the Persian Gulf.

This eroding ‘security guarantee,’ which began under former President Barack Obama and his “Pivot to Asia,” became strikingly evident in the 2019 Yemeni attack on Saudi’s Aramco oil facilities in Abqaiq and subsequent attacks on ships anchored in the UAE port of Fujairah, including two Saudi oil tankers.

After the unprecedented strikes by Yemen’s resistance movement Ansarallah, Washington’s utter failure to provide material support to its closest Persian Gulf allies – who have spent billions to procure US military protection – strongly influenced the GCC’s decision to engage with Iran.

“When the US didn’t follow through on defending its Arab partners following the Aramco attacks “it became imperative [for the UAE] to secure itself without relying on others – the US in particular – and engaging with Iran is a part of that,” Dina Esfandiary, a Middle East adviser at the International Crisis Group think tank explained.

The US’ faltering pledge to safeguard the Arab states of the Persian Gulf was heavily criticized by the Senate Republican Policy Committee. In a statement in early August, it accused Biden of undermining his commitment to Persian Gulf allies and missing an opportunity to take advantage of developments in West Asia and the US-brokered Abraham Accords for a united front against Iran.

Additional factors that accelerated dialogue with Iran include the economic impact of the coronavirus pandemic – which encouraged further economic diversification away from reliance on oil revenues – the crisis in Ukraine, global energy shortages, and the issue of regional food security.

Conflict with Iran is ‘off the table’

The 2020 Abraham Accords presented an opportunity for Israel and its new Arab partners to form an anti-Iranian front aimed at reducing Iran’s geopolitical reach. But two years of inactive bluster about an “Arab NATO” has instead demonstrated that none of the Persian Gulf’s monarchies – despite plenty of encouragement from Tel Aviv and Washington – have the political will to take that confrontational regional step.

Instead, in the aftermath of normalization, Arab states such as the UAE sought to gain economic and commercial benefits from Israeli IT technologies and clean energy companies, rather than crow for open confrontation with Iran. For this reason “Middle East NATO was a ‘theoretical’ concept and … for Abu Dhabi confrontation [with Iran] was not an option,” says Anwar Gargash, senior diplomatic advisor to the UAE president.

Other GCC member states like Saudi Arabia, Kuwait, Oman, and Qatar have thus far opposed full normalization with Israel. They know that any overt anti-Iranian front – encouraged by the US and centered on Israel – serves primarily to rehabilitate Tel Aviv’s image within Arab countries, where populations remain hostile to Israel.

They are also now painfully aware that the US will not waste its limited and valuable resources in West Asia when the strategic geography of the China Sea and East Asia are of infinitely more intrinsic value to Washington.

Following the Jeddah Summit, Saudi Arabia’s Foreign Minister Faisal bin Farhan Al-Saud said decisively: “There’s no such thing as Arabic NATO.”

Pragmatism in the Persian Gulf

Furthermore, for many Arabs, Iran acts as a valuable counterbalance to Israel in the region. The Persian Gulf – Levant and North Africa too – have a shared interest in obstructing Israel’s many troublesome and disruptive regional ambitions. Iran is a useful tool in this respect, as it absolves Arab states from doing the heavy lifting themselves, which would earn Washington’s ire.

In turn, reconciliation with its Arab neighbors will help Iran mitigate the effects of US-imposed sanctions and isolation efforts. Tehran also wants to keep these diplomatic channels open should the nuclear negotiations in Vienna not come to fruition.

Since his election in 2021, Iran’s President Raisi has repeatedly stressed that regional relations are the primary foreign policy focus of his administration. At the same time, Iran has introduced proposals on a mutually-beneficial regional security architecture that would exclude the need for external military forces in the Persian Gulf and its environs.

Tehran believes a region-first approach can strengthen relations with neighbors across all fields and, importantly, build years of depleted trust. The question is whether its Arab neighbors, many of whom rose to power on the back on western colonial projects, can extract themselves from this dependency and forge independent security strategies.

The timing is not bad. GCC states have concluded that the US will not guarantee security in the way they once perceived, and that Washington is – possibly permanently – distracted elsewhere. These events coincide with a global hike in oil and gas prices because of western sanctions on Russia. As a key member of OPEC+, Russia has thus far managed to keep influential Persian Gulf producers onside on production and pricing policies. China is investing billions in the Persian Gulf states on connectivity and infrastructure. Heavily dependent on Gulf energy resources, China – as well as Iran and Russia – is pushing for a new Persian Gulf security architecture run by regional states.

While the moment may be ripe to advance these new ideas, Iran’s reconciliation with its Arab neighbors is contingent on all parties understanding their mutual interests and threats, which is essential to reduce conflict.

The benefits will be game-changing for all. Ensuing stability in the Persian Gulf will bring about a more prosperous regional economy through interdependence, in addition to enhanced political, security, and geopolitical cooperation in the longer term.

The views expressed in this article do not necessarily reflect those of The Cradle.

The power troika trumps Biden in West Asia

The presidents of Russia, Iran, and Turkey convened to discuss critical issues pertaining to West Asia, with the illegal US occupation of Syria a key talking point

July 20 2022

Photo Credit: The Cradle

Oil and gas, wheat and grains, missiles and drones – the hottest topics in global geopolitics today – were all on the agenda in Tehran this week.

By Pepe Escobar

The Tehran summit uniting Iran-Russia-Turkey was a fascinating affair in more ways than one. Ostensibly about the Astana peace process in Syria, launched in 2017, the summit joint statement duly noted that Iran, Russia and (recently rebranded) Turkiye will continue, “cooperating to eliminate terrorists” in Syria and “won’t accept new facts in Syria in the name of defeating terrorism.”

That’s a wholesale rejection of the “war on terror” exceptionalist unipolarity that once ruled West Asia.

Standing up to the global sheriff

Russian President Vladimir Putin, in his own speech, was even more explicit. He stressed “specific steps to promote the intra-Syrian inclusive political dialogue” and most of called a spade a spade: “The western states led by the US are strongly encouraging separatist sentiment in some areas of the country and plundering its natural resources with a view to ultimately pulling the Syrian state apart.”

So there will be “extra steps in our trilateral format” aimed at “stabilizing the situation in those areas” and crucially, “returning control to the legitimate government of Syria.” For better or for worse, the days of imperial plunder will be over.

The bilateral meetings on the summit’s sidelines – Putin/Raisi and Putin/Erdogan – were even more intriguing. Context is key here: the Tehran gathering took place after Putin’s visit to Turkmenistan in late June for the 6^th Caspian summit, where all the littoral nations, Iran included, were present, and after Foreign Minister Sergei Lavrov’s travels in Algeria, Bahrain, Oman, and Saudi Arabia, where he met all his Gulf Cooperation Council (GCC) counterparts.

Moscow’s moment

So we see Russian diplomacy carefully weaving its geopolitical tapestry from West Asia to Central Asia – with everybody and his neighbor eager to talk and to listen to Moscow. As it stands, the Russia-Turkey entente cordiale tends to lean towards conflict management, and is strong on trade relations. Iran-Russia is a completely different ball game: much more of a strategic partnership.

So it’s hardly a coincidence that the National Oil Company of Iran (NIOC), timed to the Tehran summit, announced the signing of a $40 billion strategic cooperation agreement with Russia’s Gazprom. That’s the largest foreign investment in the history of Iran’s energy industry – badly needed since the early 2000s. Seven deals worth $4 billion apply to the development of oil fields; others focus on the construction of new export gas pipelines and LNG projects.

Kremlin advisor Yury Ushakov deliciously leaked that Putin and Iran’s Supreme Leader Ayatollah Ali Khamenei, in their private meeting, “discussed conceptual issues.” Translation: he means grand strategy, as in the evolving, complex process of Eurasia integration, in which the three key nodes are Russia, Iran and China, now intensifying their interconnection. The Russia-Iran strategic partnership largely mirrors the key points of the China-Iran strategic partnership.

Iran says ‘no’ to NATO

Khamenei, on NATO, did tell it like it is: “If the road is open for NATO, then the organization sees no borders. If it had not been stopped in Ukraine, then after a while the alliance would have started a war under the pretext of Crimea.”

There were no leaks on the Joint Comprehensive Plan of Action (JCPOA) impasse between the US and Iran – but it’s clear, based on the recent negotiations in Vienna, that Moscow will not interfere with Tehran’s nuclear decisions. Not only are Tehran-Moscow-Beijing fully aware of who’s preventing the JCPOA from getting back on track, they also see how this counter-productive stalling process prevents the collective west from badly needed access to Iranian oil.

Then there’s the weapons front. Iran is one of the world’s leaders in drone production: Pelican, Arash, Homa, Chamrosh, Jubin, Ababil, Bavar, recon drones, attack drones, even kamikaze drones, cheap and effective, mostly deployed from naval platforms in West Asia.

Tehran’s official position is not to supply weapons to nations at war – which would in principle invalidate dodgy US “intel” on their supply to Russia in Ukraine. Yet that could always happen under the radar, considering that Tehran is very much interested in buying Russian aerial defense systems and state of the art fighter jets. After the end of the UN Security Council-enforced embargo, Russia can sell whatever conventional weapons to Iran it sees fit.

Russian military analysts are fascinated by the conclusions Iranians reached when it was established they would stand no chance against a NATO armada; essentially they bet on pro-level guerrilla war (a lesson learned from Afghanistan). In Syria, Iraq and Yemen they deployed trainers to guide villagers in their fight against Salafi-jihadis; produced tens of thousands of large-caliber sniper rifles, ATGMs, and thermals; and of course perfected their drone assembly lines (with excellent cameras to surveil US positions).

Not to mention that simultaneously the Iranians were building quite capable long-range missiles. No wonder Russian military analysts estimate there’s much to learn tactically from the Iranians – and not only on the drone front.

The Putin-Sultan ballet

Now to the Putin-Erdogan get together – always an attention-grabbing geopolitical ballet, especially considering the Sultan has not yet decided to hop on the Eurasia integration high-speed train.

Putin diplomatically “expressed gratitude” for the discussions on food and grain issues, while reiterating that “not all issues on the export of Ukrainian grain from the Black Sea ports are resolved, but progress is made.”

Putin was referring to Turkiye’s Defense Minister Hulusi Akar, who earlier this week assured that setting up an operations center in Istanbul, establishing joint controls at the port exit and arrival points, and carefully monitoring the navigational safety on the transfer routes are issues that may be solved in the next few days.

Apparently Putin-Erdogan also discussed Nagorno-Karabakh (no details).

What a few leaks certainly did not reveal is that on Syria, for all practical purposes, the situation is blocked. That favors Russia – whose main priority as it stands is Donbass. Wily Erdogan knows it – and that’s why he may have tried to extract some “concessions” on “the Kurdish question” and Nagorno-Karabakh. Whatever Putin, Russia’s Security Council Secretary Nikolai Patrushev and Deputy Chairman Dmitry Medvedev may really think about Erdogan, they certainly evaluate how priceless is to cultivate such an erratic partner capable of driving the collective west totally bonkers.

Istanbul this summer has been turned into a sort of Third Rome, at least for expelled-from-Europe Russian tourists: they are everywhere. Yet the most crucial geoeconomic development these past few months is that the western-provoked collapse of trade/supply lines along the borders between Russia and the EU – from the Baltic to the Black Sea – finally highlighted the wisdom and economic sense of the International North-South Transportation Corridor (INTSC): a major Russia-Iran-India geopolitical and geoeconomic integration success.

When Moscow talks to Kiev, it talks via Istanbul. NATO, as the Global South well knows, does not do diplomacy. So any possibility of dialogue between Russians and a few educated westerners takes place in Turkey, Armenia, Azerbaijan and the UAE. West Asia as well as the Caucasus, incidentally, did not subscribe to the western sanctions hysteria against Russia.

Say farewell to the ‘teleprompter guy’

Now compare all of the above with the recent visit to the region by the so-called “leader of the free world,” who merrily alternates between shaking hands with invisible people to reading – literally – whatever is scrolling on a teleprompter. We’re talking of US President Joe Biden, of course.

Fact: Biden threatened Iran with military strikes and as a mere supplicant, begged the Saudis to pump more oil to offset the “turbulence” in the global energy markets caused by the collective west’s sanction hysteria. Context: the glaring absence of any vision or anything even resembling a draft of foreign policy plan for West Asia.

So oil prices duly jumped upward after Biden’s trip: Brent crude rose more than four percent to $105 a barrel, bringing prices back to above $100 after a lull of several months.

The heart of the matter is that if OPEC or OPEC+ (which includes Russia) ever decide to increase their oil supplies, they will do it based on their internal deliberations, and not under exceptionalist pressure.

As for the imperial threat of military strikes on Iran, it qualifies as pure dementia. The whole Persian Gulf – not to mention the whole of West Asia – knows that were US/Israel to attack Iran, fierce retaliation would simply evaporate with the region’s energy production, with apocalyptic consequences including the collapse of trillions of dollars in derivatives.

Biden then had the gall to say, “We have made progress in strengthening our relations with the Gulf states. We will not leave a vacuum for Russia and China to fill in the Middle East”.

Well, in real life it is the “indispensable nation” that has self-morphed into a vacuum. Only bought-and-paid for Arab vassals – most of them monarchs – believe in the building of an “Arab NATO” (copyright Jordan’s King Abdullah) to take on Iran. Russia and China are already all over the place in West Asia and beyond.

De-Dollarization, not just Eurasian integration

It’s not only the new logistical corridor from Moscow and St. Petersburg to Astrakhan and then, via the Caspian, to Enzeli in Iran and on to Mumbai that is shaking things up. It’s about increasing bilateral trade that bypasses the US dollar. It’s about BRICS+, which Turkey, Saudi Arabia and Egypt are dying to be part of. It’s about the Shanghai Cooperation Organization (SCO), which formally accepts Iran as a full member this coming September (and soon Belarus as well). It’s about BRICS+, the SCO, China’s ambitious Belt and Road Initiative (BRI) and the Eurasia Economic Union (EAEU) interconnected in their path towards a Greater Eurasia Partnership.

West Asia may still harbor a small collection of imperial vassals with zero sovereignty who depend on the west’s financial and military ‘assistance,’ but that’s the past. The future is now – with Top Three BRICS (Russia, India, China) slowly but surely coordinating their overlapping strategies across West Asia, with Iran involved in all of them.

And then there’s the Big Global Picture: whatever the circumvolutions and silly schemes of the US-concocted “oil price cap” variety, the fact is that Russia, Iran, Saudi Arabia and Venezuela – the top powerful energy-producing nations – are absolutely in sync: on Russia, on the collective west, and on the needs of a real multipolar world.

The views expressed in this article do not necessarily reflect those of The Cradle.

Andrei Martyanov: SAS and BRICS

July 14, 2022

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