Saudi Arabia pivots to Russia, the new
sheriff in town
What a
difference a year – an eternity in geopolitics – makes. No one could see this
coming; the ideological matrix of all strands of Salafi-jihadi terror – which
Russia fights no holds barred, from ISIS/Daesh to the Caucasus Emirate –
beating a path to the Kremlin and about to embrace Russia as a strategic ally.
The House of Saud was horrified by Russia’s successful campaign
to prevent regime change in Syria. Moscow was solidifying its alliance with
Tehran. Hawks in the Obama administration were imposing on Saudi Arabia a
strategy of keeping oil prices down to hurt the Russian
economy.
Now, losing all its battles from Syria to Yemen, losing regional
influence to both Iran and Turkey, indebted, vulnerable and paranoid, the House
of Saud has also to confront the ghost of a possible coup in Riyadh against
Crown Prince Mohammad bin Salman, a.k.a. MBS, as Asia Times reported. Under so much pressure, who’re you gonna
call?
The ultimate ghostbuster; Russian President
Vladimir Putin.
Essentially, the House of Saud is obsessed by
three main vectors; low oil prices; Iran and Shi’ism; and what to make of
US foreign policy under Trump. Let’s take them one by one.
I want my
S-400s
As much as a Moscow-Washington reset remains
doomed, even with the implosion of Russia-Gate, House of Saud advisers must
have known that the Kremlin won’t ditch its strategic relationship with Iran –
one of the key nodes of Eurasia integration.
Moscow will keep aligned with Iran across
“Syraq”; that’s part of the “4+1” (Russia-Syria-Iran-Iraq, plus Hezbollah)
alliance in the Levant/Mesopotamia, an incontrovertible (and winning) fact on
the ground. And that does not preclude Russia’s increasingly cozy relationships
across the Arab world – as with Egypt, Jordan, the UAE and Libya.
What concerns Moscow, deeply, is Saudi (formal
or informal) financing of Salafi-jihadi outfits inside Russia. So a high-level
line of communication between Moscow and Riyadh works towards dissipating any
misunderstandings regarding, for instance, jihadism in Tatarstan and Chechnya.
Moscow does not buy the much-spun (in the
West) Iranian “aggressive behavior” in the Middle East. As a key negotiator of
the Joint Comprehensive Plan of Action (JCPOA), Russia very well knows that
Iran’s ballistic missile program is actually the key target of Trump’s imminent
decertification of the Iran deal.
These missiles actually represent dissuasion
against any possible US attack, “leading from behind” or not. The Islamic
Revolutionary Guards Corp (IRGC) in Tehran has made it quite clear the
ballistic missile program does not fall into the JCPOA, and will remain active.
Enter the memorandum of understanding (MOU)
between the Saudis and Rosoboronexport (Russia’s state body for exporting
military hardware) signed in Moscow for the purchase of the S-400 missile
system; the Kornet-EM system; the TOS-1A; the AGS-30; and last but not least
the new Kalashnikov AK-103.
The S-400 success story is unequivocal. Iran
bought it. Turkey bought it. Now Saudi Arabia buys it – even after splurging a
fortune in US weapons during Trump’s by now infamous “sword dance” visit to
Riyadh.
So no wonder, after the S-400 news, the US
State Department like clockwork approved the possible – that’s the operative
word – $15 billion sale of 44 THAAD launchers and 360 missiles to Saudi Arabia,
a very good business for Lockheed Martin and Raytheon.
The Pentagon’s defense security cooperation
agency said, “this sale furthers US national security and foreign policy
interests, and supports the long-term security of Saudi Arabia and the Gulf
region in the face of Iranian and other regional threats.” Cynics already
envisage a battle of Iranian S-400s and Saudi THAADs “moderated” by Saudi
S-400s.
We are the
new OPEC
King Salman may have boarded the Saudi Arabian Airlines flight,
but the real architect of the pivot to Russia is MBS. Oil in Saudi Arabia
accounts for 87% of budget revenues, 42% of GDP, and 90% of exports. MBS is
betting all his cards on the Vision 2030 program to “modernize” the Saudi
economy, and he knows very well it will be impossible to pull off if oil prices
are low.
At the Russia Energy Week forum in Moscow,
Saudi Arabia’s Energy Minister Khalid Al-Falih said the Aramco IPO – a key
driver of funds to Vision 2030 – will happen in the second half of 2018,
contradicting Saudi officials who earlier stated the IPO was once again
postponed to 2019. And no one can tell whether it will take place in the NYSE
or not.
Meanwhile, the priority remains the OPEC /
non-OPEC deal (with Russia at the forefront) to “stabilize” oil prices,
clinched in November 2016 to cut production. President Putin tentatively agreed
the deal could be extended beyond March 2018, something to be discussed in
detail at the next OPEC meeting in Vienna in late November.
The deal may certainly be seen as a purely
strategic/economic measure to stabilize the oil market – with no geopolitical
overtones. And yet OPEC is geared to become a brand new animal – with Russia
and Saudi Arabia de facto deciding where the global oil markets go, and then
telling the other OPEC players. It’s open to question what Iran, Algeria,
Nigeria, Venezuela, among others, will have to say about this. The barely
disguised aim is to bring oil prices up to a band of $60-75 a barrel by the
middle of next year. Certainly a good deal for the Aramco IPO.
There were a rash of other deals clinched in
Moscow – such as Aramco and the Russian Direct Investment Fund (RDIF) $1
billion fund for oil-services projects in Russia, plus another $1 billion for a
technology fund.
This synergy implies Saudi Arabia investing in
top Russian energy assets and Russia, for instance, supplying gas to the Saudi
petrochemical industry and reducing drilling/production costs. Certainly a good
deal for Vision 2030.
The new
sheriff in town
To say that the Saudi pivot to Russia is
rattling nerves across the Beltway is an understatement. The CIA is not exactly
fond of MBS. 9/11-related puzzles are bound to resurface.
What’s also clear is that the House of Saud
has realized it cannot be left to watching camels as the great Eurasia
integration caravan picks up speed. Russia has pipelines crisscrossing most of
Eurasia. China is building rail lines connecting all of Eurasia. And we
haven’t even touched specific Saudi-Chinese projects part of the Belt and Road Initiative
(BRI).
Those were the days of King Abdulaziz and FDR
aboard the USS Quincy in the Suez Canal forging a strategic partnership; the
days of Washington leading Saudi Arabia to increase oil production, drive down
prices and weaken the USSR; the days of the Afghan jihad. Now there’s no US
dependence on House of Saud oil anymore. And jihadist blowback is the name of
the security game.
It may be too early to identify the Saudi pivot to Russia as
the shift of the century. It is though a certified
game-changer. Moscow is about to become the new sheriff in town, in virtually
any town across Southwest Asia. And it’s getting there on its own terms,
without resorting to a Colt dialectic. MBS wants energy/defense cooperation? He
gets it. MBS wants less Russian cooperation with Iran? He doesn’t get it. OPEC
aims at higher oil prices? Done. And what about the S-400s? Free – sort of –
for all.
