By Pepe Escobar and cross-posted from Counterpunch.org
Major turbulence seems to be the name of the game in 2016. Yet the current turbulence may be interpreted as the calm before the next, devastating geopolitical/financial storm. Let’s review the current state of play via the dilemmas afflicting the House of Saud, the EU and BRICS members Russia, Brazil and China.
Oil and the House of Saud
Not many people are familiar with the Baltic Dry Index. Yet the Index is key to track commodity demand. Two months ago, it was trading to all-time lows. Since then, it has increased over 130%. Precious metals prices have all moved higher in virtually all currencies. Why is this important? Because it tells us that faith in fiat currencies – the US dollar especially – is sharply declining.
The Baltic Index rise portends a rise in oil demand in Asia – especially China. Falling supply and rising demand for oil will likely drive up the price of the barrel of oil in the second half of 2016.
That does not mean that the House of Saud will win back the trust of both the US and Russia. Deep sources keep confirming that as far as Washington and Moscow are concerned, the House of Saud is expendable. Both are really energy independent (should the US want to be). Powerful Washington factions blatantly accuse Riyadh of “terror” – well, it’s way more complicated – while Moscow regards the House of Saud as following US orders to destroy Russia in an oil price war.
Ailing – on the way to dementia – King Salman and young Warrior Prince Mohammed would be finished if those famous 28 pages about 9/11 were released and the Saudi connection is incontrovertible. What next? Regime change. A CIA coup. A “trusted” Saudi military CIA asset elevated to power.
What’s left for the House of Saud is to play for time. High up in Riyadh the feeling is that relations with Washington won’t improve while Obama is president; the next president – whether Hillary or The Donald – will be a much better deal. So Plan A for now is to keep posing as essential to Washington in the “war on terra”; that means King Salman falling back on Mohammed bin Nayef, the Crown Prince, way more adept at it than the Warrior Prince, the conductor of the disastrous war on Yemen.
In parallel, Turkey’s Sultan Erdogan keeps advancing his play to take over oil in Iraqi Kurdistan, eventually diverting the whole supply to make Turkey energy independent – and thus a regional superpower. Moreover, in Pipelineistan terms, Erdogan absolutely also needs the Qatar gas pipeline through Saudi Arabia and Syria to gain energy independence from Russia. That also happens to be a major US goal. And that also portends perennial trouble for the Syria peace process.
Erdogan already has the German superpower at his feet in the shape of a groveling, begging Chancellor Merkel. Were Turkey on its way to become an energy power, Merkel would prostrate herself on that Ankara palace golden ground non-stop. The CIA intimates as much, when it analyzes how Turkey will keep “expanding its influence” in Iraq through the militias they support, at the expense of Iraq’s security and political unity.
Andrew Bacevich’s America’s War for the Greater Middle Eastexamines how Washington ruled that “military preponderance” across the Middle East should be the strategic objective in a war against the USSR – that was when Dr. Zbig “Grand Chessboard” Brzezinski reigned as geopolitical supremo. This was always supposed to be an endless war – now encompassing the “Greater Middle East” the neocons are so fond of.
Russia, Brazil and Hybrid War
Russia’s largest commodity exchange is actively courting international oil traders to join its emerging futures market. The goals are crystal clear; to disconnect the price-setting mechanism from the Brent oil benchmark and, crucially, to move away from the petrodollar. That also happens to be a key condition imposed by Beijing to the House of Saud for continuing to buy their oil.
It’s easy to forget that it was only 20 years ago that Moscow wanted to join the West as Christians, and was treated like trash. Russia was perceived in the Beltway to be weak under Yeltsin, who let in looters who ate up Russia as locusts, collapsing Russia’s GDP by 40% as they drew out natural resources, absconding with at least a trillion US dollars.
Now Exceptionalistan keeps updating every trick in the book to destroy or at least undermine Russia with Maidan in Ukraine, an oil price war, attacks on the ruble, Syrian pipelines. Hybrid, unconventional warfare rules – and these will only get nastier…