By Chris Martenson of Peak Prosperity
While turbulent during the best of times, gigantic waves of change are now sweeping across the Middle East. The magnitude is such that the impact on the global price of oil, as well as world markets, is likely to be enormous.
A dramatic geo-political realignment by Saudi Arabia is in full swing this month. It’s upending many decades of established strategic relationships among the world’s superpowers and, in particular, is throwing the Middle East into turmoil.
So much is currently in flux, especially in Saudi Arabia, that nearly anything can happen next. Which is precisely why this volatile situation should command our focused attention at this time.
The main elements currently in play are these:
- A sudden and intense purging of powerful Saudi insiders (arrests, deaths, & asset seizures)
- Huge changes in domestic policy and strategy
- A shift away from the US in all respects (politically, financially and militarily)
- Deepening ties to China
- A surprising turn towards Russia (economically and militarily)
- Increasing cooperation and alignment with Israel (the enemy of my enemy is my friend?)
Taken together, this is tectonic change happening at blazing speed.
That it’s receiving too little attention in the US press given the implications, is a tip off as to just how big a deal this is — as we’re all familiar by now with how the greater the actual relevance and importance of a development, the less press coverage it receives. This is not a direct conspiracy; it’s just what happens when your press becomes an organ of the state and other powerful interests. Like a dog trained with daily rewards and punishments, after a while the press needs no further instruction on the house rules.
It does emphasize, however, that to be accurately informed about what’s going on, we have to do our own homework. Here’s a short primer to help get you started.
A Quick Primer
Unless you study it intensively, Saudi politics are difficult to follow because they are rooted in the drama of a very large and dysfunctional family battling over its immense wealth. If you think your own family is nuts, multiply the crazy factor by 1,000, sprinkle in a willingness to kill any family members who get in your way, and you’ll have the right perspective for grasping how Saudi ‘politics’ operate.
The House of Saud is the ruling royal family of the Kingdom of Saudi Arabia (hereafter referred to as “KSA”) and consists of some 15,000 members. The majority of the power and wealth is concentrated in the hands of roughly 2,000 individuals. 4,000 male princes are in the mix, plus a larger number of involved females — all trying to either hang on to or climb up a constantly-shifting mountain of power.
Here’s a handy chart to explain the lineage of power in KSA over the decades:
We’ll get to the current ruler, King Salman, and his powerful son, Mohammed Bin Salman (age 32), shortly. Before we do, though, let’s talk about the most seminal moment in recent Saudi history: the key oil-for-money-and-protection deal struck between the Nixon administration and King Faisal back in the early 1970’s.
This pivotal agreement allowed KSA to secretly recycle its surplus petrodollars back into US Treasuries while receiving US military protection in exchange. The secret was kept for 41 years, only recently revealed in 2016 due to a Bloomberg FOIA request:
The basic framework was strikingly simple. The U.S. would buy oil from Saudi Arabia and provide the kingdom military aid and equipment. In return, the Saudis would plow billions of their petrodollar revenue back into Treasuries and finance America’s spending.
It took several discreet follow-up meetings to iron out all the details, Parsky said. But at the end of months of negotiations, there remained one small, yet crucial, catch: King Faisal bin Abdulaziz Al Saud demanded the country’s Treasury purchases stay “strictly secret,” according to a diplomatic cable obtained by Bloomberg from the National Archives database.
“Buying bonds and all that was a strategy to recycle petrodollars back into the U.S.,” said David Ottaway, a Middle East fellow at the Woodrow Wilson International Center in Washington. But politically, “it’s always been an ambiguous, constrained relationship.”
The essence of this deal is pretty simple. KSA wanted to be able to sell its oil to its then largest buyer, the USA, while also having a safe place to park the funds, plus receive military protection to boot. But it didn’t want anybody else, especially its Arab neighbors, to know that it was partnering so intimately with the US who, in turn, would be supporting Israel. That would have been politically incendiary in the Middle East region, coming as it did right on the heels of the Yom Kipper War (1973).
As for the US, it got the oil it wanted and – double bonus time here – got KSA to recycle the very same dollars used to buy that oil back into Treasuries and contracts for US military equipment and training.
Note that this is yet another secret world-shaping deal successfully kept out of the media for over four decades. Yes Virginia, conspiracies do happen. Secrets can be (and are routinely) kept by hundreds, even thousands, of people over long stretches of time.
Since that key deal was struck back in the early 1970s, the KSA has remained a steadfast supporter of the US and vice versa. In return, the US has never said anything substantive about KSA’s alleged involvement in 9/11 or its grotesque human and women’s rights violations. Not a peep.
Then Things Started To Break Down
In 2015, King Salman came to power. Things began to change pretty quickly, especially once he elevated his son Mohammed bin Salman (MBS) to a position of greater power.
Among MBS’s first acts was to directly involve KSA into the Yemen civil war, with both troops on the ground and aerial bombings. That war has killed thousands of civilians while creating a humanitarian crisis that includes the largest modern-day outbreak of cholera, which is decimating highly populated areas. The conflct, which is considered a ‘proxy war’ because Iran is backing the Houthi rebels while KSA is backing the Yemeni government, continues to this day.
Then in 2016, KSA threatened to dump its $750 billion in (stated) US assets in response to a bill in Congress that would have released sensitive information implicating Saudi Arabia’s involvement in 9/11. Then-president Obama had to fly over there to smooth things out. It seems the job he did was insufficient; because KSA-US relations unraveled at an accelerating pace afterwards. Mission NOT accomplished, it would seem.
In 2017, KSA accused Qatar of nefarious acts and made such extraordinary demands that an outbreak of war nearly broke out over the dispute., The Qatari leadership later accused KSA of fomenting ‘regime change’, souring the situation further. Again, Iran backed the Qatar government, which turned this conflict into another proxy battle between the two main Gulf region superpowers.
In parallel with all this, KSA was also supporting the mercenaries (aka “rebels” in western press) who were seeking to overthrow Assad in Syria — yet another proxy war between KSA and Iran. It’s been an open secret that, during this conflict, KSA has been providing support to some seriously bad terrorist organizations like Al-Qaeda, ISIS and other supposed enemies of the US/NATO. (Again, the US has never said ‘boo’ about that, proving that US rhetoric against “terrorists” is a fickle construct of political convenience, not a moral matter.)
Once Russia entered the war on the side of Syria’s legitimate government, the US and KSA (and Israel) lost their momentum. Their dreams of toppling Assad and turning Syria into another failed petro-state like they did with Iraq and Libya are not likely to pan out as hoped.
But rather than retreat to lick their wounds, KSA’s King Salman and his son are proving to be a lot nimbler than their predecessors.
Rather than continue a losing battle in Syria, they’ve instead turned their energies and attention to dramatically reshaping KSA’s internal power structures…