- *Debka, 2 March, 2012* *US-Saudi Rift Jacks up Oil Prices*** *Are the Saudis Using Oil to Block Obama’s Reelection?* When President *Barack Obama* signed theMessage 1 of 1 , Mar 3 12:51 AMView Source
Debka, 2 March, 2012
US-Saudi Rift Jacks up Oil Prices
Are the Saudis Using Oil to Block Obama’s Reelection?
When President Barack Obama signed the latest round of US sanctions against Iranian oil on the last day of 2011, he and his advisers were careful to include Section 1245 of the National Defense Authorization Act for Fiscal 2012 (HR 1540) and to emphasize it will apply only if the president determines “the price and supply of petroleum and petroleum products produced in countries other than Iran is sufficient to permit purchasers… to reduce significantly in volume their purchases from Iran.” This section and the intense discussions Treasury Secretary Timothy Geithner led with Riyadh to secure alternative Saudi supplies to Iranian oil if needed ought to have capped the price spiral. But it did not.
An indirect explanation for this was discernible in the words of Saudi Deputy Oil MinisterAbdulaziz bin Salman bin Abdulaziz upon arriving in New Delhi last Friday, Feb. 24.
He stressed his government’s concern to keep the global oil market well supplied, “…and that has always been our endeavor,” he said.
But when he was asked if oil prices would rise further if supplies from Iran dropped, the Saudi minister said cryptically: “We don’t engage ourselves in any of these discussions.” DEBKA-Net-Weekly’s Gulf sources report that the Saudi deputy minister’s evasiveness gave an extra spurt to the rumors circulating in the international oil market that the Saudi royal court had decided to use oil as a tool of coercion against the US President and his policies on Iran and Syria.
US allows Iran to retain its nuclear achievements
Riyadh is playing a tit-for-tat game which goes like this: We (the Saudis) will increase oil production to make up shortfalls of Iranian supplies to the Chinese, Japanese, South Koreans, Indians and certain EU countries to induce them to subscribe to anti-Tehran sanctions – but you (the Americans) must in return dismantle Iran’s nuclear weapon program either by diplomatic means or military action.
When the Obama administration turned to a third avenue, international negotiations with Tehran, Riyadh reacted by readjusting its commitment to keep the world supplied with enough crude to overcome the boycott on Iranian oil: (See DEBKA-Net-Weekly 529 of Feb. 17: Obama Gets His Way – US and Iran Set to Resume Nuclear Talks) They shrugged off responsibility for prices.
The Saudis were especially incensed by the concomitant lure Washington offered Tehran for talks: a license to continue uranium enrichment regardless of the diplomatic process and maintain nuclear development at its present level. This left Iran sitting pretty with a short timeline for producing a bomb whenever Tehran so decides.
Enraged by US military inertia on Syria
Saudi King Abdullah is also hopping mad over the world powers’ military inertia on Syria where the continuous pounding of cities inflated the death toll this week past one hundred civilians per day and Bashar Assad faces charges of war crimes. The King has a bone to pick with Moscow as well as Washington. In fact, he slammed down the phone on Russian President Dmitry Medvedev Wednesday, Feb. 22, after being informed that Moscow would neither permit the overthrow of Bashar Assad in Damascus nor countenance any nuclear accord with Iran - whether it was reached in multiple negotiations or with the United States alone – which altered the current state of Tehran’s nuclear program.
“There is no going back,” Medvedev told the Saudi King.
Abdullah retorted sharply that Moscow’s approach was totally unacceptable to the oil kingdom, whether pursued by the United States, Russia or Iran.
“We (the Saudis) will force them to back away from the level they have currently reached,” Abdullah told Medvedev.
The Obama administration’s policy on Syria, epitomized in the repudiation of military force for removing the Assad regime, is just as unacceptable to Riyadh as its position on Iran.
Saudis to Obama: Oil could rocket past $150 unless he strikes Iran
Oil industrial sources in the Gulf say that King Abdullah is venting his displeasure selectively. Saudi Arabia will provide enough oil to replace the Iranian shortfall to Tehran’s biggest buyers in the Far East who are also good friends of Riyadh. But he feels no compulsion to abide by the other part of the Saudi-US understanding which is to keep prices down.
Soaring prices will carry an unsubtle Saudi message to President Obama, a very high-placed oil source in the Gulf told DEBKA-Net-Weekly: Either attack Iran and get the Islamic Republic off our backs, or we’ll let oil prices rocket up to $150 per barrel and beyond - and you won’t be re-elected in November.
This week crude oil prices hit a nine-month high.
American officials and oil industry figures offered various pretexts for the hikes, such as general concerns about Iran’s nuclear program or, according to Treasury Secretary Geithner, Iranian saber-rattling. None admitted that the dominant factor in the upwardly mobile price level is uncertainty over America’s next steps for handling the Syrian crisis and Iran’s fast-moving nuclear weapons program.
The Obama administration is reported by our sources as being under heavy pressure from Saudi Arabia and Israel for a confrontation with Iran beyond diplomacy and the current sanctions.
The most recent news from Washington is that so far the president is holding fast to his standing policies despite efforts to pin him down to a harder line ahead of his critical White House meeting with Prime Minister Binyamin Netanyahu on March 5. He may still change his mind.
Straws in the wind will be avidly sought in the major policy speech President Obama is scheduled to deliver at the opening of the AIPAC (pro-Israel lobby) convention in Washington Sunday, March 4.
Obama Worries about a Potential Saudi-Israeli Front for Attacking Iran
Last minute: In a dramatic U-turn showing Israel that Washington is serious about its military option against Iran’s nuclear program, Pentagon officials disclosed Thursday, March 1, that “military options being prepared start with providing refueling for Israeli planes and include attacking the pillars of the clerical regime. They include the Islamic Revolutionary Guards Corps and its elite Qods Force, regular Iranian military bases and the Ministry of Intelligence and Security." The officials spoke on condition of anonymity in Washington’s first public reference to possible joint military action with Israel against Iran.
These comments came in response to an Israeli request to the Obama administration to finally set red lines for Iran’s nuclear program and abandon its “shifting red lines” option. Washington was also asked to spell out US military contingencies in place of the tired “all options are on the table” mantra.
Two days earlier, on Feb. 28, the never-ending spate of American evaluations rolling out these days - for and against an Israeli attack on Iran’s nuclear facilities – produced an odd AP news agency dispatch: Its correspondent on intelligence, Kimberly Dozier, wrote that Jerusalem had decided once and for all not to notify Washington in advance of an attack on Iran so as to save Washington from blame for not preventing it.
And then the article ended with this paragraph: U.S. intelligence and special operations officials have tried to keep a dialogue going with Israel, despite the high-level impasse, sharing with them options such as allowing Israel to use U.S. bases in the region from which to launch such a strike, as a way to make sure the Israelis give the Americans a heads-up.
The proposition that America would let Israel use bases for an action against Iran to which it is flatly opposed merely to discover when it starts is, on the face of it, even more outlandish.
And why would the Israelis use American bases if they wanted to save America from blame?
However, according to DEBKA-Net-Weekly’s intelligence sources, the AP “analysis” was far from foolish. Looked at sideways, its double meanings represented a trial balloon released by Washington to shed light on three sources of US anxiety, the foremost of which is whether Saudi Arabia and Israel have secretly gone back to military and intelligence cooperation for an attack on Iran’s nuclear program.
Failure to complain would implicate Gulf nations in colluding with Israel
1. By the improbable offer of US bases in the region for an Israeli attack on Iran, the Americans hope to find out if any Persian Gulf emirates have got in first by secretly offering their own facilities for this purpose. If so, Washington would feel compelled to draw Israel back into the US fold by an offer of full American cooperation for abandoning its Gulf option.
2. The US does not have extraterritorial bases in the Persian Gulf. Before offering Israel the use of the Gulf facilities at its disposal, Washington would first have to ask the emirs for permission. So what was the point of making this option public?
Because that was another trial balloon. The Gulf emirates which host US military facilities were expected to respond to the article by asking Washington for clarifications with assurances that Israel was not offered bases located on their soil. The administration expected to be illuminated by a process of elimination: The Gulf governments which didn’t ask for clarifications would be presumed to be secretly cooperating with Israel in the run-up to a strike in Iran, with military or intelligence support - or other means. DEBKA-Net-Weekly’s intelligence sources disclose that to date, three Gulf nations have omitted to query Washington on the AP article: Saudi Arabia, Qatar and Abu Dhabi. Our Washington sources were not surprised. Those very governments recently offered to place their air forces and air and naval bases at the disposal of a Saudi plan for military intervention in Syria. (See the separate articles in this issue on the Riyadh-Washington rift) They would obviously be even keener to follow the Saudi lead for busting Iran.
Saudi air bases once offered for an Israeli strike on Iran
3. Saudi-Israel military and intelligence cooperation is not new – especially when it comes to working together to preempt a nuclear Iran.
Four years ago, senior Israeli officials held a series of secret high-level consultations with prominent Saudi princes, one at least attended by a prime minister, Ehud Olmert, to discuss the division of labor for an operation to cripple Iran’s nuclear program. National Security Adviser Prince Bandar bin Sultan, who last year took over undercover operations against the Arab Spring, was part of the collaboration.
In this framework, Prince Muqrin bin Abdulaziz, Director of Saudi General Intelligence got together with Israel counterparts, including former Mossad director, Meir Dagan.
Over the past four years, the Saudis leaked reports attesting to their willingness to grant refueling facilities at their air bases to Israeli warplanes heading to attack Iran and open them up for emergency landings by any Israel planes hit by Iranian anti-aircraft missiles or damaged in dogfights. Saudi medical services were made available in case wounded Israeli air crews required treatment.
These reports were covered extensively at the time by DEBKA-Net-Weekly.
One prominent item published in 2010 disclosed that Saudi Arabia had given Israel the use of tracts of desert land converted to landing fields with jet refueling facilities installed nearby.
Saudi-Israel cooperation back on track?
In recent months, Washington learned of a new round of meetings between the new Israeli Mossad Chief Tamir Pardo and high-ranking Saudi intelligence officials.
Washington was made additionally suspicious by the apparent overlap between messages addressed to the White House by the Saudi royal house and the offices of the Israel Prime MinisterBinyamin Netanyahu and Defense Minister Ehud Barak.
Two out of three of those messages were almost identical: One called for the Obama administration to publicly warn Iran that failure to live up to preset terms for terminating its nuclear weapon program would elicit a military attack. The other asked Washington to lay down red lines which Iran’s nuclear program was forbidden to cross – also on pain of a military strike. The third message came exclusively from Riyadh and demanded American military action against President Bashar Assad of Syria.
Obama knows time is short for an Iran policy revision
President Obama knows time is running out for a decision on whether to accept or reject the demands for putting Iran on the spot coming from Saudi Arabia and Israel, DEBKA-Net-Weekly’s Washington sources report. Saudi patience with Obama’s reluctance to confront Iran is more or less exhausted, as Foreign Minister Saud al-Faisal told US Secretary of State Hillary Clinton when they met in Tunis on Feb. 24. Disappointed with Washington, Riyadh has turned its face toward alternatives, he said. Israel refuses to give Washington any commitments to hold off attacking Iran or giving the administration advance notice of one. The US president also understands that the speech he is invited to deliver Sunday March 4 at the national convention of AIPAC (The American Israel Public Affairs Committee) in Washington is one of the most important events of his career. Disappointing the audience of more than 14,000 Jewish delegates from across the United States, who are hanging on his words in expectation of a new strategy on Iran beyond sanctions and diplomatic pressure - may cost him their support for his reelection to the White House. It would also doom his summit with Netanyahu the following day to failure, thereby boosting the prospects of a potential Israeli-Saudi partnership for striking Iran.
Saudis Lean on Obama to Backpedal on His Non-Military Iran Policy
At around the time this edition reaches you, Dennis B. Ross, one of the most authoritative non-officials of the Obama administration, will have just ended his background briefing on the administration’s Iran policy for a group of American journalists in Washington. Although he has held no position in the White House since resigning last year from two years as top adviser to President Barack Obama on Iran, his words will be lapped up as coming from the horse’s mouth.
Indeed, DEBKA-Net-Weekly’s sources confirm that Ross is still in the president’s confidence and called on to advise him in the current round of tense discussions at the top of the administration on how to proceed next on the Iran question.
The White House must now decide whether to confine itself to sanctions and the current option of international nuclear talks with Iran starting in Istanbul in April, based on granting US-led international recognition of its nuclear achievements to date – or turn to a new strategy of confrontation.
Ross’s briefing to selected correspondents may point to openness for exploring a new path. It would have to be formulated as a draft by the end of this week.
Facing heat from Saudi Arabia and two more quarters
If the president decides to stick with his current policy after all, he would have to stand up to the heat coming at him from three directions: Saudi Arabia, Israel and his own campaign for reelection as president in November.
This article focuses on the feud between Washington and Riyadh.
The rupture in relations between King Abdullah of Saudi Arabia and President Obama is said by Washington insiders in the know to run a lot deeper this time even than the breakdown which followed on the slinging match between the two leaders in their phone call on Feb. 9, 2011. Then, the monarch slammed down the phone after accusing the president of personal responsibility for the downfall of his friend, the deposed Egyptian President Hosni Mubarak.
A year on, Abdullah had his foreign minister Saud al-Faisal sharply chide Obama in an oral communication, which DEBKA-Net-Weekly’s sources report was delivered to US Secretary of State Hillary Clinton behind the scenes of the Friends of Syria meeting in Tunis Friday, Feb. 24.
According to those sources, the king had this to say to the president: “The Iranians tried to bring down Bahrain’s Al-Khalifa throne last February and March as a prelude to overthrowing the Saudi royal family in Riyadh. We (the Saudis) are determined to pay them back by deposing Iran’s closest Middle East ally, Syrian President Bashar Assad.” The Saudi demarche went on to caution that after getting rid of Assad, they would also find a way to put an end to Iran’s nuclear program.
Obama turns away from military plan to “humanitarian corridors”
Clinton did her best to explain her government’s policy on Iran and Syria, but the Saudi prince interrupted her by getting up and saying: It that is the case then I can only take it that just as you (the Americans) are still unwilling to take action against Iran, the same is true in the case of Assad. If that is the situation, we (the Saudis) will find our own way to resolve the two problems.
Without waiting for Clinton’s response, Saudi al-Faisal stalked out of the building where the conference was taking place. On the way to his car, he phoned through to the members of his delegation and told them to pack their bags and get ready to return to Riyadh at once.
The Saudis were especially ticked off on hearing from Secretary Clinton that Obama had flatly rejected the new plan for limited Western-Arab military intervention in Syria submitted last week by French President Nicolas Sarkozy (see DEBKA-Net-Weekly 530 of Feb. 24, “The US Ponders Military Intervention in Syria – Sarkozy’s Safe Haven Plan Is on Obama’s Desk”).
In breaking the news, she also disclosed that the US President had now turned to an alternate program for setting up “humanitarian corridors” in the places were the Syrian army and rebels are fighting for control at the expense of the civilian populations. (See, “Hot Points,” Feb. 29).
That plan too is contingent on Russia taking on the task of getting Assad to agree to quietly keep his army and security forces back from attacking the aid corridors – if not approve it.
Saudis offer Arab air forces for Syria operation
The Saudi foreign minister had his answer ready: If the Americans don’t care to put their air force on the line in Syria, not to worry; Saudi Arabia and several other Arab nations had large air forces and would be glad to invest them in a military operation against Assad.
The prince was referring to the quiet discussions King Abdullah had been conducting with Egyptian’s military ruler and de facto president,Field Marshall Mohamed Hussein Tantawi, for harnessing the Egyptian Air Force to the campaign alongside the Saudi Air Force. When Clinton remarked that President Obama was dead set against Arab military action going ahead in Syria without the United States or Turkey, Saud shot back that Turkish Prime MinisterTayyep Erdogan and his foreign minister, Ahmet Davutoglu, are free with offers to join any plan for military intervention, but when it comes to the point of hammering out operational details, they disappear. And so the Clinton-Saud conversation ended on the same caustic note as it started. The immediate upshot of this conversation on Saud bin Faisal’s return home was a decision by Riyadh to speed up Saudi arms shipments to the Syrian rebels via Iraq and Lebanon - and so nullify the Obama administration’s policy against arming Syrian rebels and its reliance on diplomacy and sanctions for curbing the atrocities of the Assad regime.
Anti-tank weapons flow to rebels tripled
Military and intelligence watchers monitoring the new spate of arms shipments reported that this week overall quantities had been doubled and contained three times more anti-tank weapons than previous consignments.
On the diplomatic plane, the Saudis invited Russian Foreign MinisterSergey Lavrov to pay his first ever visit to Riyadh next Wednesday, March 7.
Gulf Cooperation Council members will make sure he hears their beefs about the Russian stance on Syria.
But above all, the visit will also give the Saudis a chance to show Washington there are more fish in the sea and that failing US action, they are turning in other directions for help to rid Syria of Bashar Assad.
But most immediately, Obama administration strategists are worried not just about the deep rift with Riyadh but the potential coming together of Saudi Arabia and Israel for an attack on the Iranian nuclear program - in defiance of Washington’s objections.