Saudi Arabia Retreats From The Troubles Its Clown Prince Caused
When the Saudi King Salman promoted his son Mohammad bin Salman (MbS) to Defense Minister and then Crown Prince the expectations were high. But three of the major projects Muhammad launched since then soon ran into trouble. Now initiatives are under way to limit the damage he caused. The end of the five year old Saudi war on Yemen is coming into sight. The public offering of the Saudi state owned ARAMCO oil company is finally happening but with a much lower valuation than originally planned. The thirty month spat with Qatar is under repair.
On August 17 2019 a Yemeni drone attack on Saudi Arabia's oil installations proved that the Saudis had lost the war. Moon of Alabama's headline empasized the effect that it would have:
Long Range Attack On Saudi Oil Field Ends War On Yemen
Today's attack is a check mate move against the Saudis. Shaybah is some 1,200 kilometers (750 miles) from Houthi-controlled territory. There are many more important economic targets within that range. [...]
The attack conclusively demonstrates that the most important assets of the Saudis are now under threat. This economic threat comes on top of a seven percent budget deficit the IMF predicts for Saudi Arabia. Further Saudi bombing against the Houthi will now have very significant additional cost that might even endanger the viability of the Saudi state. The Houthi have clown prince Mohammad bin Salman by the balls and can squeeze those at will.
A month later another large scale attack disabled half of the Saudi oil output.
The Saudis have since procured additional U.S. military units to provide more air defenses around their oil installations. But U.S. air defenses are not effective against the kind of attacks the Yemenis launched. The Saudis had no choice but to sue for peace.
For several months there have been talks in Oman between Saudi official and Houthi delegations. An preliminary agreement was found but no official announcements were made. That changed today when Saudi Arabia’s Minister of State for Foreign Affairs Adel al-Jubeir made a comment that for the first time recognized the Houthi as a legitimate Yemeni entity:
Speaking on the situation in Yemen, al-Jubeir said that there is a possibility of reaching a truce in the country, which could be followed by a settlement.“Yemen is of particular importance to us, and Iran’s intervention there is devastating. The only solution in Yemen is political, and the Houthis are the ones who started the war, not us.”
“All Yemenis, including the Houthis, have a role in the future of Yemen,” he added.
Today the Saudis also released some 200 prisoners who belonged to the Houthi. They were flown to Yemen's capital Sanaa. The preliminary agreement foresees the forming of a common government by the Houthi and the Saudi controlled former president Hadi.
This is not yet the end of the war. It will take quite some time before a new Yemeni government will evolve as the Saudis still have some unrealistic demands:
Saudi Arabia seems more open to some kind of coexistence with the Houthis in north Yemen through taking control over them from Iran. After signing the Riyadh power-sharing agreement between the separatist Southern Transitional Council and the UN-recognised government in Aden, Saudi Arabia and the UAE seem to be ready to move on to the next phase of their gouty war in Yemen.Instead of the endless fighting, Saudi Arabia is trying to convince the Houthis to sever ties with its regional rival, Iran. After all, all the Houthis want is legitimacy of their new strategic posture in Yemen. This, in their view, must be cited in a similar power-sharing agreement that guarantees their share in a federation-like new system that includes president Abedrabbo Mansour Hadi’s government and separatists in the south.
Iran has never had "control" over the Houthi. Even the U.S. State Department has recently changed course and finally admitted that:
In a shift that analysts said reflects progress in Saudi talks with Yemen’s Houthi rebels to end the Yemen war, State Department Iran envoy Brian Hook said today that Iran does not speak for the Houthis, whom he described as playing a more constructive role in issuing a cease-fire proposal.“We should recall that the Houthis proposed a cessation of missile and air attacks with Saudi Arabia just days after the Iranians struck Saudi oil installations on Sept. 14,” Hook told journalists at the State Department.
“The Houthis’ de-escalation proposal, which the Saudis are responding to, shows that Iran clearly does not speak for the Houthis, nor has the best interests of the Yemeni people at heart,” Hook said. “Iran is trying to prolong Yemen’s civil war to project power. Iran should follow the calls of its own people and end its involvement in Yemen.”
Hook’s comments praising the Houthi de-escalation proposal stand in contrast to how he described the Houthis, in a September Wall Street Journal op-ed, as an Iranian proxy group. He further characterized the Iranian-Houthi relationship as a “strategic alliance.”
The Houthi are not under Iranian control and neither is Hizbullah in Lebanon. These groups are independent political entities which make their own decisions in their own interests. Iran helps those groups during times of need as they will help Iran when necessary. Hook's claim that Iran is trying to prolong Yemen’s war is without any basis.
Iran has enabled the Houthi to resist throughout the 5 years of war the Saudis waged on them. Drones and missiles parts provided by Iran to the Houthi allowed them to compel the Saudis to sue for peace. It is therefore highly unlikely that the Houthi will dissociate themselves from Iran. They will agree to end their attacks on Saudi Arabia if the Saudis end their attacks on Yemen and pay for the damage their war has caused. If the Saudis do not agree to that more of their helicopters will come down in flames and more of their oil installations will be set on fire.
The war on Yemen was started by clown prince Muhammad bin Salman who was then Defense Minister of Saudi Arabia. He had hoped for a fast victory but the well equipped Saudi military proved to be incapable of defeating barefoot Houthi in the mountains of north Yemen. The war costs the Saudis several billions per month and threatens to ruin the state.
Muhammad Bin Salman's other projects did not go any better. He had planned to sell shares of Saudi Aramco at international stock exchanges and at a total valuation of 2 trillion dollar. The move was supposed to bring in $100 billion to finance a further industrialization of the Saudi economy. After many delays Saudi Aramco is now finally making its initial public offering. The shares will start trading on December 11. But the stock will only be listed at the Saudi Tadawul exchange.
The initial share price offer puts the value of the company at $1.7 trillion which is higher than the $1.5 trillion estimate international banks had published. Today the Saudis announced a large cut in their oil output to increase the global oil prices and the company's valuation. That might attract more urgently needed buyers to the IPO. But the stocks will still be sold to mainly domestic entities, if needed with some pressure. Instead of attracting $100 billion of fresh money from abroad some $25.6 billion will be taken out of the left Saudi trouser pocket to be put into the right one. The economic benefit for the country is dubious.
Two and a half years ago the clown prince tried to attack and occupy Qatar. The given ideological reason was the Qatari support for the Muslim Brotherhood. But the real reason was the Saudi need for more money which MbS tried to gain through a real estate and resource grab. The project failed when Turkish troops came to Qatar's aid. The Saudis and its UAE allies then tried to isolate Qatar with an embargo. That failed too but caused the Saudi rulers additional headaches which is why they are now pushing to end the conflict:
[N]ow more than two years on, signs of economic and political fracture are beginning to show not in Qatar, but in its embargoing neighbors. It is these indications that may help explain the countries’ recent conciliatory gestures, including the resolution to join the Arabian Gulf Cup in Doha and contemporaneous remarks by Saudi and Emirati officials suggesting a newfound openness to ending the dispute.
...
Since the oil crash of 2014, which saw prices plummet from more than $100 per barrel to below $30, all GCC countries have sought to offset enormous budget deficits by embarking on painful, fundamental changes to their oil-based economies.
...
As it happens, the GCC members that have gone the farthest in imposing unpopular reform measures are the blockading states, whereas Kuwait, Oman and Qatar have deferred implementation of the VAT and other structural reforms.
The Saudi rulers fears that their own population will point to Qatar and demand an increase in welfare or lower taxes. If all GCC countries, including Qatar, agree to take the same steps that the Saudis had to take, the chance of a revolt would decrease.
Qatar's foreign minister has recently made a 'secret' visit to Riyadh and the Saudi King has invited the Emir of Qatar to the next GCC meeting. But Qatar has a budget surplus while the Saudis have a 10% deficit. Qatar has no need to follow the economic policies of the other GCC countries. It will only do so if the Saudis are willing to offer something for it.
Three of the clown prince's major projects have failed. On top of that comes the reputational damage that the murder, on MbS' order, of Jamal Khashoggi caused. That the Saudi king has now taken steps to limit the overall damage may have come through the influence of Muhammad bin Salman's younger brother, Khalid bin Salman. KbS had been the Saudi ambassador to the U.S. Since February 2019 he has been the Deputy Defense Minister of Saudi Arabia. He was involved in the talks with the Houthi. It is possible that the king will finally recognize that MbS is not good enough for the job and that Khalid may a better successor to the throne than his brother Mohammad.
Posted by b on December 6, 2019 at 18:59 UTC | Permalink
« previous pagewhen you see companys and half divisions of mechanized forces on rail to ports in the south and the east, along with troops on the planes, the invasion will be near. even most of the tanks in afghanistan were trucked in not air dropped. you don't go to war in jeeps.
there is no way the planners will really believe that a few carriers will be able to sustain engagement with iran forget Russia or china, by ways of some carriers who need to refuel and replenish ammo and petroleum after a few weeks which is why shock and awe wasn't shock for a whole month it was merely a few days and nights.
a lot of you think it takes a snap order to completely mobilize troops for conflict when the modern forces could not do much better than the mongols.
Posted by: jason | Dec 8 2019 15:31 utc | 102
john @ 101 say:
USAans by extra beer and watch extra television
when he meant to say 'buy' :(
jason @ 102 says:
a lot of you think it takes a snap order to completely mobilize troops for conflict...
yeah, a lot of people think we invaded Afghanistan because of 9/11.
Posted by: john | Dec 8 2019 16:27 utc | 103
Lysias, sorry but you're totally wrong :
Louis XVIII(comte of Provence) and Charles X (comte of Artois) were indeed the brothers of Louis XVI and, reigning after them, Louis-Philippe I was their cousin.
Posted by: Ibn Idrissi | Dec 8 2019 16:31 utc | 104
Noirette so Yemen was intended as little more than a diversion? I think the war on Yemen was a resource grab after a failure to get access through Hadi. tuyzenfloot, 79
Not only a diversion, of course. These kinds of attacks / aka “wars” often fulfill multiple purposes. Which is why they are implemented > a consensus is found. Also, weakened (as compared to previous clout and status) Leader Cabals (KSA is run thru relative royal-extended-group-agreement, or was until MBS, which is *one* reason the status quo lasted for so long..) often flex muscle in an attempt to …mobilise ppl, win some battle, declare some victory, keep the in-group soldered and keen, etc. etc.
I am one of those who often in discussion downplays the ‘grabbing resources’ aspect… e.g. What about Iraqi oil after 2003? Is the US ‘profiting’? Hmm.. Those precious minerals in Afghanistan? As for Trump saying he wants to “keep Syria’s oil” that is divorced from reality on so many counts … including that he would be contravening US sanctions - :)
Posted by: Noirette | Dec 8 2019 18:21 utc | 105
Mina #100
Absolutely agree with that. Sad for humanity that we have such twisted inept governments.
Posted by: uncle tungsten | Dec 8 2019 19:50 utc | 106
Russ@98
War with Iran would destroy the oil supply chain from the Persian Gulf. While the people of Europe would be most affected the US would suffer indirectly due to a loss of heavy oil necessary for blending the fracking petroleum products containing high levels of condensates. All Russian Ural oil would be redirected to Europe (or result in much higher oil prices in the US as well) as would most of the oil from Africa to make up for the loss of Gulf oil. Such oil shortages would result in disruptions of the US supply chains and agriculture production leading to riots.
While increased fracking in the Permian basin can be used to mitigate these petroleum losses this would be a short term solution. The other fracking basins in the US have peaked and conventional oil only supplies about 40% of US domestic oil production. Fracking wells deplete by 80-90% in the first three years. Thus the US would suffer a delayed collapse and riots over food and energy resources.
Invading Venezuela might provide a medium time frame solution but would result in hundreds of thousands of US military casualties given the Venezuela defense capabilities.
Posted by: krollchem | Dec 8 2019 21:16 utc | 107
jason @102
a lot of you think it takes a snap order to completely mobilize troops for conflict when the modern forces could not do much better than the mongols
That alone would be impressive. Who could match the Mongols in their heyday? Later, much later, the NA Comanches (?)
Posted by: pogohere | Dec 9 2019 0:15 utc | 108
@ krollchem 107
The original comment sounded far more proximate and less speculative than what you write about. He implied that war with Iran in itself would trigger riots, I assume anti-war riots. I'm skeptical of that.
Longer term, no doubt the inevitable collapse of industrial agriculture and the shortages that will follow will lead to unrest, demonstrations, riots. (Shortages as opposed to the famines that will follow hard; starving people have no energy for anything let alone rioting. Which is why there's good reason to think the extreme precariousness of the food system, and the system's treatment of the natural ecology upon which this system remains 100% dependent, is not just an accidental part of capitalism in food production and distribution, but a deliberate feature, the ability to force famine at will.)
As for the nightmarish fracking interlude you envision, if only there was energy to riot against that and physically prevent it. But as long as the worthless material junk keeps being churned out, the masses will happily continue to commit ecocide and thereby hasten their own collective suicide. Obviously only a mob of lunatics would destroy their own land and water in such a way. Indeed, I'd call the fracking binge itself a monumental self-destructive riot.
@ Russ in comment # 109 who wrote
"
Obviously only a mob of lunatics would destroy their own land and water in such a way. Indeed, I'd call the fracking binge itself a monumental self-destructive riot.
"
I have to admit being related to that "mob of lunatics" you mention. One of my sisters is married to a man who has extended family in North Dakota who they went to visit this past summer. My sister told me about them being driven around and shown the fracking equipment that had one of the families name on it...and she was impressed.
I bite my tongue a lot when with my family, which I try to make very infrequent. This is the same family part that thinks that Boeing airplane crashes were pilot error......what part of my family that isn't evangelical is God of Mammon brainwashed or both.....sigh
Posted by: psychohistorian | Dec 9 2019 6:29 utc | 110
@105 Noirette, I can't disagree with that argument. Resources as a direct motivation are overestimated.
Stretched to a much wider interpretation, beyond the straightforward "we just want to make money with the resources" they are still important. The ability to deny or allow access to resources for instance is a major motivation.
It is the motivation for occupying the oil fields in Syria. It is what makes Iraq important in the sense that the US wants control over Iraq because of its resources and because it is in a resource rich environment.
With KSA and Yemen there are complications. I believe Yemen is a resource rich country, KSA is past its peak oil, not able to maintain its role , and in financial trouble. At the same time the US is leaning heavily on them to and KSA has to deliver the oil and money.
So there are possible levels of agreement. I think the incompetence of MBS causes people (including Bernhard) to underestimate the pretty desperate context in which MBS has to operate, and to attribute the problems too much to MBS.
And an extra claim would be that KSA has direct interest in the Yemen resources to make up for its own declining resources. The reason the international invesoers are not interested in the IPO is not the war. It's that they are using an estimate of the reserves and cost of exploitation which is much lower than anyone states publicly. And of course that is also the reason for launching the IPO in the first place.
Posted by: Tuyzentfloot | Dec 9 2019 9:08 utc | 111
@ psychohistorian 110
Literally everyone in my family either actively or passively (mostly the latter) supports every aspect of the empire. I don't bother talking with any of them about anything having to do with any of this. Thankfully no one I see regularly is any kind of proselytizer, or I'd have to tell them what's what and probably get in fights.
Truth is, I have no one to talk to in real life. Even the people I work with in the community food movement are all reformists and mostly Dembots. Again thankfully, they're not types who insist on talking about politics when we're doing the food-related work. They don't bring it up, I don't bring it up, best I can do. What a life, living in a psycho ward.
Tuyzentfloot 111
… an extra claim would be that KSA has direct interest in the Yemen resources to make up for its own declining resources.
Agreed, and probably KSA thought exactly that…
The reason the international investors are not interested in the IPO is not the war.
MBS floated that proposal, and I read that at some point King Salman halted the procedure ..probably wisely. Absolutely. KSA is in all kinds of trouble (as you point out), >> the curse of Black Gold.
Posted by: Noirette | Dec 9 2019 17:01 utc | 113
Russ(no, i'm not hounding you) says:
What a life, living in a psycho ward
yeah, barking at the moon. thing is Russ, the psychopaths running the ward have no imagination. none whatsoever, but they're relentless and will never give up.
fascists only relinquish power when it is pried from their cold, dead hands
the redundancy in their methodology and in our collective submission to it are indeed pathological, thus impelling some of us to dwell more and more in the abstract, where they daren't tred, our dreams lacking form, but at least incubating freely(for now).
and that's about as much solace as i can muster.
Posted by: john | Dec 9 2019 17:24 utc | 114
john 114
I didn't think you were hounding me John. I also wasn't expecting much solace from you. We know how bad things are.
I don't dwell in the abstract, but I suppose I do dwell in a different deep time, the deep past and the post-civilization future.
Russ@
109
I really appreciate your thoughtful response to my post.
Sorry if my post on the secondary affects of the destruction of Persian Gulf oil production appeared to be misleading. The riots over disruptions in agricultural production and US supply chains due to energy cost increases would not be against the government but rather against each other. Gail Tverberg at her website (https://www.youtube.com/watch?v=7TprgnuYfyQ) has pointed out that most people could not afford increases in energy costs which feedbacks into limits on energy extraction in the future. Such energy shortages would degrade society as GDP is directly correlated with energy production.
As a retired environmental scientist I have watched the strip mining of the environment over the last 50 years. I fully agree with your assessment on the American way of ecocide:
“Obviously only a mob of lunatics would destroy their own land and water in such a way. Indeed, I'd call the fracking binge itself a monumental self-destructive riot. “
Like you, my wife and I have no one to talk to as our families and associates are in denial as to the state of the ecological collapse and the drums of war over the remaining resources:
“Truth is, I have no one to talk to in real life. Even the people I work with in the community food movement are all reformists and mostly Dembots. …”
I get a blank stare if I mention the “MIT study by the Club Rome on the Limits of Growth (https://www.clubofrome.org/2018/10/20/gloomy-1970s-predictions-about-earths-fate-still-hold-true/), the work on Doughnut economics (https://www.kateraworth.com/doughnut/) or Dr Albert Bartlett’s work on Exponential Growth Arithmetic, Population and Energy
(https://www.youtube.com/watch?v=kZA9Hnp3aV4)
Your statement “What a life, living in a psycho ward.” Was right on and reminded me of the great anti-war movie “King of Hearts” (https://www.latimes.com/entertainment/movies/la-et-mn-king-of-hearts-archive-20180308-story.html)
My sister is one of the fascists who have chosen outward pride of country over internalized self esteem. To her America is the greatest country in the world and can do no wrong. In contrast I see Amerika as following the militaristic route of Sparta. The latest military recruitment warrior video comes across as fascist like a remake of the movie “Starship Troopers” but where the evil bugs are replaced by countries that oppose US conquest. https://www.youtube.com/watch?v=7TprgnuYfyQ
Posted by: krollchem | Dec 9 2019 22:31 utc | 116
@Haassaan #80
The problem with this scenarios is that someone has to volunteer to get killed; other people have to cover up that the mission was suicidal to start with.
I also wonder what the Abraham Lincoln's crew would think about being a gold plated sacrifical lamb. The US just spent $4 billion to refit it and you talk about blithely sending it (and its 5500 crew) to the bottom. Admiral Malloy, head of the US Navy's 5th fleet, would be forever remembered as the guy who lost the Lincoln. Centcom would get off unscathed either, since Malloy reports to Centcom.
The sequence you note also isn't very credible since it already happened several times.
1) Iranian passenger jet shot down - Iran doesn't try to sink any American ships
2) USS Stark attacked by Iraqi jets, but much more easily spun into an attack by Iran.
3) Just a short while ago, a $100M or so drone was shot down. Trump declined to retaliate.
Why now? Particularly when the sitting US President is clearly not very enthused about this - and on the cusp of an election year?
Posted by: c1ue | Dec 9 2019 22:39 utc | 117
Krollchem 116
Thanks for the reply. Yup, I get everything you say and am familiar with the works you cite. When you say "The riots over disruptions in agricultural production and US supply chains due to energy cost increases would not be against the government but rather against each other" I take that to mean the corporate state will try to direct all that kinetic energy into divide-and-conquer. They'll sure try, though once it reaches an extreme point the existing system usually is engulfed by its own catastrophe.
I haven't seen the movies you mention but from what I hear "Starship Troopers" (the movie, and I assume the original Heinlein story as well which I haven't read) has exactly that goal. In movies like that the "aliens" always, more or less deliberately, are designed to stand in for the real-world "Other".
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Russ says:
Who do you think would riot in the streets
i think he's referring to all those activists who, you know, don't exist yet.
remember all those riots after they passed the Patriot Act, embellished with the disposition matrix? remember all those riots after they locked down Boston to look for some 17-year-old kid who was probably wounded, perhaps dead? did you notice all the riots out there yesterday as the legislative branch incites sedition against a sitting president? right.
on the weekend the French hit the streets, USAans by extra beer and watch extra television.
all indications are that Americans will embrace the coming tyranny like my daughters used to embrace their cuddly gorilla.
Posted by: john | Dec 8 2019 11:32 utc | 101