Tag Archives: OIl

King Solomon of Arabia Sweeps into Cairo: About the Wisdom and Ibrahim Pasha……..

Shuwaikh-school1 Hiking Sharqeya-Baneen-15

KuwaitCox2

King Salman of Saudi Arabia has been on a long state visit to Egypt. The visit started with Egyptian authorities covering a public statue of Ibrahim Pasha, son of the creator of modern Egypt Mohammed Ali Pasha, during the Saudi King’s visit to Cairo. Ibrahim Pasha conquered Najd, birthplace of Wahhabism early in the 19th century. That was probably the last Egyptian military victory of modern times.

Saudi media and diplomats have hinted at a “pleasant” surprise gift from the Saudi King for the Egyptian people. That is rather doubtful: Arab leaders (or Middle East leaders in general) never have pleasant surprises for the people of another Arab state, nor for their own people. It is certain that the visit itself is no gift.

But we can speculate. President Al Sisi was recorded last year as suggesting to his advisers that Persian Gulf states have so much money, that it is like rice (unlimited numerous grains of rice). So, there might be ‘some’ more Saudi rice for the collapsing economy of Egypt. But the Saudis don’t have as much “rice” as they used to: their own reckless oil policies have contributed to the crash of crude prices in the past two years. The kings, potentates, and princes of the Gulf are cutting back on spending on their own people (but not on themselves or their merchant-class political and business allies). They are highly unlikely to be more generous with Egypt.

There is another option, but the Saudis have managed to make it a not-so-credible option, almost comic. After the Arab uprisings of 2011 started, then Saudi king Abdullah surprisingly invited far-away Morocco and humorless Jordan to join the GCC. Neither country is on the Gulf, and neither is as well financially as the GCC states. But both are monarchies, but much more democratic than the Gulf states. I commented at the time that it will never happen, and I was right.
Now, with the money limited, the Saudi King can invite Egypt to join the GCC: the first military-ruled republic to get this dubious honor. That may force the Egyptians to become more active in the Saudi military endeavors and adventures, in the Persian Gulf and elsewhere. That may be the Saudi hope. But Egyptians are unlikely to accept the role of second-fiddle, or even deep involvement far from hom. A country with a civilization of 6 thousand years, albeit now poor and misruled, is unlikely yo take orders from some tribal backwater like Riyadh or Abu Dhabi.

Egypt can’t be Number Two in any Arab endeavor. We all know the Arab world is full of ruling Number Two’s already, if you get my meaning.
Cheers
Mohammed Haider Ghuloum

The Strange Turkish Russian Iranian Syrian Oil and Pistachio Deals with DAESH…….

Shuwaikh-school1 Hiking Sharqeya-Baneen-15

KuwaitCox2 ChristmasPeanutsA

When news seeped out about ISIS/DAESH selling and exporting oil over a year ago, I suspected a Turkish connection, even though Western and Saudi/Qatari media claimed there were deals between ISIS and the Assad regime. After all, the weapons, volunteers, and possibly much of the money for the Jihadis in Syria flowed through the long Turkish border. And ISIS/DAESH controls areas along the border.  And there have been credible reports of cooperation between Turkish military and intelligence and the Jihadists in Syria. These days, when a terrorist or accomplices escape from a European country, they head for Turkey: that is the trailhead to lands controlled by ISIS.
Now the Russians have come out and said it openly, with claims of documentation. Iranian media have also carried and seemed to support the Russia claim.
The Turks could not be original, so what did they do? A day or two later they made their own claim of Russian-ISIS oil deals. I didn’t know Russian needed Syrian or Iraqi oil.
Wait, there is more. To make matters more entertaining, there are now reports on the social media of Turkish claims that Iranians also made oil deals with ISIS/DAESH. Tit-for-tat, since the Iranians seemed to support the earlier Russian claims. I didn’t know that the Iranians also needed Syrian or Iraqi oil. I had thought they spent the past few years trying to sell more of their own oil, not buy foreign oil from their Wahhabi enemies.
What next? Turkish claims of Iranian deals to buy Aleppo pistachios from ISIS? Iranian claims of Saudi oil deals with ISIS? Qatari claims that the Bahrain regime imports some of its nasty interrogators from ISIS? Oh, wait……….
Cheers
Mohammed Haider Ghuloum

Follow ArabiaDeserta on Twitter

Russia: an Economic Barbarossa? Une Grande Armee économique?……….

Shuwaikh-school1 RattleSnakeRidge Sharqeya-Baneen-15

KuwaitCox2     ChristmasPeanuts

Have Yourself a Merry Little——-> Kenny G. Holiday 

Russia Reels” screams the headline in the Huffington Post. With similar headlines in other media. An old headline that goes back to another world…….
You’d think we were back to Barbarossa and June 22, 1941. But perhaps with expectations of different results this time…...

Or perhaps a financial version of La Grande Armee of Napoleon, an economic assault. Which might have better luck, better results this time around, given the interdependence of the world economies.
Cheers
Mohammed Haider Ghuloum                          Follow ArabiaDeserta on Twitter

[email protected]

Crude Oil Price as a Two-Edged Sword for the GCC……….

Shuwaikh-school1 RattleSnakeRidge Sharqeya-Baneen-15

KuwaitCox2     ChristmasPeanuts

Have Yourself a Merry Little——-> Kenny G. Holiday 

“Additionally, the Saudis get a chance to deal Russia, Bashar al-Assad’s stalwart ally, a bloody nose, by driving down the cost of oil and hurting Moscow’s hydrocarbon revenue streams, which prop up a shaky domestic economy. As oil prices have fallen so has the value of Russia’s Rouble, plummeting 35% since June. Killing two birds with one stone would seem a smart policy, especially since it is highly unlikely to result in the sort of military escalation the Saudis wish to avoid. How long can the Saudis keep this game up? Realistically a few months, but if the price of oil keeps falling the Saudis may have to rethink their strategy……………”

Oil prices normally rise during times of economic growth in the USA and especially during periods of geopolitical turmoil as is happening in Eastern Europe and across the Middle East and Libya. But oil prices have been going down for some time now in spite of speeding US growth and turmoil in producing regions.

Some have predicted that the oil price decline may come to bite those who engineered them for political reasons, such as Saudi Arabia and the United Arab Emirates. It was also argued that the Persian Gulf Arab producers have huge sovereign funds that can cushion the domestic economic impact.
Fine and dandy, but we must consider the impact on the sovereign funds and on local GCC Gulf financial markets and on the public finances: (a) The Gulf sovereign funds are invested mainly in the world markets and are losing value as American and other markets decline with the price of crude; (b) Domestic GCC markets are now also tanking, from Saudi Arabia to Dubai, which will bring political pressure on the princes, shaikhs and potentates to support the stock markets. Many middle class families in the GCC are suffering huge market losses, estimated in many billions of dollars. In the Gulf, princes and potentates from Abu Dhabi to Riyadh rely on patronage as well as a ruthless mercenary security apparatus to keep absolute political power. Now there will be clamor for some more patronage to help market investors: you want to keep absolute political power, you gotta pay for it (from the people’s money, of course). Which in turn will create more pressure on the domestic budgets and on the value of sovereign funds.

In addition, now the oil price decline is beginning to be seen as a negative for the US economy. Odd, after decades of blaming the rise of the same variable for slow growth.
Given the shale fuel industry and the huge investments in it, as well as the importance of the major oil companies and their credit standing, the US economy now shares one thing with the Iranian and Russian economies. Some market ‘analysts’ now stress that the U.S. financial markets need oil prices to move up for the markets to rebound from recent losses. But does Main Street America need high oil prices back? That is unlikely.

Interesting: the USA, Iran, and Russia all ‘need’ higher oil and gas prices now. 
Cheers
Mohammed Haider Ghuloum                          Follow ArabiaDeserta on Twitter

[email protected]