Who is the Biggest Satan?

I have often written that Saudi Arabia and Iran must end their animosity and find out who is their common enemy. Over the decades United States has brainwashed Saudis by propagating “Iran is a bigger threat as compared to Israel”. I am sure if, Russia, Iran and Saudi Arabia join hands and develop a common currency to trade oil; it could bring US hegemony to an end. I want all my readers to read the following content and find out “The biggest Satan”.

The decision by OPEC Plus nations to reduce oil production is a foreign policy black eye for President Biden after his July visit to Saudi Arabia. It’s also prompting calls from congressional Democrats to rethink the Washington-Riyadh alliance, particularly on the subject of weapons and defense technology sales.  

Human rights advocates have long criticized what is sometimes a rocky relationship between the US and Saudi royals, particularly after the 2018 murder of Washington Post columnist Jamal Khashoggi. 

When Biden met with Saudi Crown Prince Mohammed bin Salman in July, it was viewed by many as a necessary evil that could potentially lead to increased OPEC output and lower gas prices. Since Wednesday’s announcement, a number of Democratic lawmakers have called for the US to respond by ending arms sales and military assistance to the kingdom.

“From unanswered questions about 9/11 and murder of Jamal Khashoggi, to conspiring with Russian President Vladimir Putin to punish the US with higher oil prices, the royal Saudi family has never been a trustworthy ally of our nation. It’s time for our foreign policy to imagine a world without their alliance,” Sen. Dick Durbin, the number two Democrat in the Senate, tweeted Thursday.

Sen. Bernie Sanders, meanwhile, called the cutback “a blatant attempt to increase gas prices at the pump” and called for an end to military assistance to Saudi Arabia. 

On the House side, Reps. Tom Malinowski, Sean Casten and Susan Wild have introduced legislation to withdraw US troops from the kingdom, calling the cutback “a turning point in our relationship with our Gulf partners.” 

Another vocal House critic of the Saudis, Rep. Ro Khanna, has also called for the nation to be dealt with “harshly” and for an end to weapons sales. 

“The Saudis need us more for weapons than we need them. President Biden should make it clear that we will cut off weapons if OPEC Plus doesn’t reverse the decision to make drastic cuts in production,” Khanna said in a statement to The Hill. “In Congress, we should also explore ways to rein in OPEC Plus control over energy prices worldwide.” 

Sen. Bill Cassidy, a vocal critic of Biden’s energy policies, told The Hill that critics of the Saudi government are “upset because having consciously made ourselves dependent upon them, they’re not bending to our will” despite Biden taking office “promising an adversarial relationship.”  

Sarah Leah Whitson, Executive Director of the nonprofit Democracy for the Arab World Now, was skeptical that the cuts would lead to a lasting schism in the relationship. In an interview with The Hill, Whitson said much of the public anger at Saudi Arabia was likely “performative,” but added that “some of it is real, because publicly, this is so humiliating to Biden.”  

Ahead of Biden’s Saudi trip over the summer, the White House was careful to portray the president as not meeting directly with bin Salman, who the intelligence community determined approved Khashoggi’s killing in Istanbul in 2018. But upon arrival in Jeddah in July, Biden was met by bin Salman outside the royal palace where the two men fist-bumped, a casual gesture critics viewed as elevating Salman on the world stage despite Biden’s campaign pledge to make the kingdom a pariah.

American military support for Saudi Arabia dates back to World War II, when President Franklin Roosevelt and King Abdul Aziz reached an agreement under which the US would provide security backing in exchange for access to Saudi oil. In 2015, the Saudis led a coalition to intervene in Yemen’s civil war against Iran-backed Houthi rebels. Over the next four years, US arms sales to the Saudis increased 130 percent, according to data from the Stockholm International Peace Research Institute.  

Biden was a vocal critic of Saudi Arabia on the campaign trail and early in his presidency, pledging to end US backing for the Saudis and the United Arab Emirates in Yemen. However, in August his administration allowed the sale of more than US$5 billion in arms to the two OPEC nations. The administration also caught the ire of Saudi critics by failing to call for an end to its blockade of Yemen. 

In the meantime, Whitson said, despite the calls to sever the business relationship with the Saudis, the American defense industry is likely to stiffly resist any attempts to unwind it. In the meantime, she said, the Saudis would likely find alternate sellers to replace much of the lost arms sales to the US. 

An end to arms sales “is not just a punishment for Saudi Arabia. It’s a punishment for a very powerful defense industry that has extremely close ties to Biden administration,” she said. “So I think there will be countervailing pressures on taking the actions that are being threatened.” 

“The painful reality that we see over and over and over again, is that our policymakers … are not actually in a position to make the decisions that are in the best interests of the American people because they are beholden to so many interests,” she said.  

 

Israel-Lebanon maritime deal

The Israel-Lebanon maritime deal is in the interests of both countries. The deal can help unlock energy security for both states at a time when the world needs new and secure natural gas supplies.

Israel has much to gain from the current talks, but it does not mean Israel must make a deal at any price. Lebanon appears to be pushing for last-minute changes to a US-backed deal that President Joe Biden’s energy envoy, Amos Hochstein, has worked on for the past year.

Prime Minister Yair Lapid said Israel will not compromise on its security and economic interests. Several entwined issues are at stake.

Israel wants the Karish gas field to begin production, and Energean, which developed the field, is ready to move ahead. 

Hezbollah is openly threatening the field – not only launching drones, but prodding Lebanon to increase rhetoric against Israel’s exploitation of these resources off its coast.

The deal that has been worked on with US support would see Israel receive royalties from gas that Lebanon extracts in the disputed area of the Mediterranean Sea, but Israel would concede a triangle of economic waters. 

Lebanon only recently asserted more claims to these waters. Lebanon also wants to develop a field called Qana that extends into areas Israel claims.

The current deal would preserve a line of buoys that extends some five kilometers off the coast into the sea. 

Then the line would deviate slightly and give Lebanon more of the area it wants. It appears that this would be in the interests of other countries as well, such as France.

Lebanese block 9 of its offshore concessions could lead to exploitation of the Qana field, but Lebanon does not want Israel receiving any share of profits from that field. 

This creates complexity. In the past, it was assumed that trade and economics could underpin peace in the region. Lebanon needs investment, and Hezbollah is busy siphoning off money from the state. 

The upcoming Israeli election also hangs over the current discussions. Opposition leader Benjamin Netanyahu has opposed Lapid’s decisions and has openly said the deal, which he views as surrender to Hezbollah threats, would not bind a new government that he seeks to establish after the November election.

This could create another strange situation in which one Israeli government accepts the deal and the next tears it up, the way the US shifted tactics on the Iran deal. 

This would lead to tensions and accusations that Israel is then crossing the line and give Hezbollah an excuse to resist by firing rockets.

 

 

 

 

               

 

Israel snubs Lebanese request for changes in maritime deal

Lebanon said US-brokered talks to demarcate its maritime border with longtime foe Israel were at a make or break point on Thursday after Israel rejected revisions to a draft deal requested by Beirut, throwing years of diplomatic efforts into doubt.

The draft, which has not been made public, had a warm preliminary reception from the Israeli and Lebanese governments. But amid domestic opposition in both countries, Lebanon on Tuesday sought amendments from the US envoy.

On Thursday, Israeli Prime Minister Yair Lapid was updated on the details of the substantial changes Lebanon is seeking to make and instructed the negotiating team to reject them, an Israeli official said.

A spokesperson for the US embassy in Jerusalem said the parties were at a critical stage in the negotiations and the gaps have narrowed.

According to Israeli media, a main sticking point was over recognition of a line of demarcation buoys Israel has strung out to sea from its coast. Lebanon worries about any action that may connote formal acceptance of a shared land border.

Lebanon, which has never recognized the state of Israel, with any broader peace deal beyond the horizon - has also said Israel will earn no royalties from the Lebanese share of gas in the Qana prospect.

Top Lebanese negotiator Elias Bou Saab told Reuters on Thursday that he would only respond to official statements and not to media reports on Israel's stance.

He said the deal is 90% done but the remaining 10% could make it or break it, adding that he was in constant contact with US mediator Amos Hochstein.

Israel has been preparing to activate a gas rig, Karish, which is outside Qana. Lebanon's Iran-backed Hezbollah made veiled threats about Karish that lent urgency to the talks.

Israel previously presented the draft deal with Lebanon, if finalized, as securing Karish. But on Thursday, it changed tack.

Israel is now pressing ahead with Karish, regardless of progress or no progress in the talks, whereas before it cast a successful deal as a means of securing Karish.

"Israel will produce gas from the Karish rig as soon as it is possible to do so," the Israeli official said, adding that negotiations will "stop immediately" in the face of any threats.

Defence Minister Benny Gantz further hardened the tone, saying in a speech that "Lebanon will bear a heavy military price" if Hezbollah attacks, and he put forces on alert.

 

Nord Stream investigation finds evidence of detonations

A crime scene investigation of the Nord Stream 1 and 2 gas pipelines from Russia to Europe has strengthened suspicions of gross sabotage involving detonations, Sweden's Security Service said on Thursday.

Swedish and Danish authorities have been investigating four leaks from the pipelines in Swedish and Danish exclusive economic zones in the Baltic Sea since they were first spotted at the beginning of last week.

Europe, which is a facing an energy crisis is investigating what caused the damage as Moscow seeks to pin the blame on the West, suggesting the United States stood to gain.

Washington denies any involvement as a stand-off between Russia and European countries continues over supplies of gas that have stopped flowing or been put on hold as a result of the conflict in Ukraine.

The Nord Stream operators said this week they were unable to inspect the damaged sections because of restrictions imposed by Danish and Swedish authorities who had cordoned off the area.

"After completing the crime scene investigation, the Swedish Security Service can conclude that there have been detonations at Nord Stream 1 and 2 in the Swedish economic zone," the Swedish Security Service said in a statement.

The security service said there was extensive damage to the gas pipelines and they had retrieved some material from the site that would now be analyzed. The evidence has strengthened the suspicions of gross sabotage, they said.

Sweden's Prosecution Authority said in a separate statement that the area, where gas spewed into the sea for almost a week, was no longer cordoned off.

Russia said on Thursday it had been informed via diplomatic channels that it was not able to join the investigation.

"As of now, there are no plans to ask the Russian side to join investigations," Kremlin spokesman Dmitry Peskov told reporters, adding that Moscow replied it was not possible to conduct an objective investigation without its participation.

Swedish prosecutors had on Monday cordoned off the area of the leaks for a crime scene investigation conducted by the Swedish Coast Guard and Navy.

On Wednesday, Sweden's Justice Minister said in response to the Kremlin that it was not possible to let others take part in a Swedish criminal investigation.

Denmark's Foreign Minister Jeppe Kofod told Reuters on Thursday that his Ministry had not told Russia to stay out of the investigation, but that a police-led taskforce between Denmark, Sweden and Germany was in charge of the investigation.

Maria Zakharova, spokeswoman for the Russian Foreign Ministry, said separately on Thursday that Moscow would insist on a comprehensive and open investigation that includes Russian officials and Gazprom.

"Not to allow the owner (of the pipelines) to witness the investigation means there is something to hide," Zakharova said.

 

 

Can the US impose sanctions on Saudi Arabia?

The United States is all critical of the latest decision of the OPEC Plus to cut oil production. Interestingly the hike in oil and gas prices is due to the US imposing sanctions on Russia, earlier on Venezuela and Iran. It is feared that out of desperation the US may impose some sanctions on Saudi Arabia, often termed de-fecto leader of oil cartel. I invite all my readers to carefully read a Reuters news dated May 05, 2022.

According to the details, a US Senate committee passed a bill that could expose the Organization of the Petroleum Exporting Countries (OPEC) and partners to lawsuits for collusion on boosting crude oil prices.

The No Oil Producing or Exporting Cartels (NOPEC) bill sponsored by senators, including Republican Chuck Grassley and Democrat Amy Klobuchar, passed 17-4 in the Senate Judiciary Committee.

White House spokesperson Jen Psaki said the administration has concerns about the potential implications and unintended consequences of the legislation, particularly amid the Ukraine crisis. She said the White House is still studying the bill.

Versions of the legislation have failed in Congress for more than two decades. But lawmakers are increasingly worried about rising inflation driven in part by prices for US gasoline, which briefly hit a record above US$4.30 a gallon.

"I believe that free and competitive markets are better for consumers than markets controlled by a cartel of state-owned oil companies ... competition is the very basis of our economic system" Klobuchar said.

NOPEC would change US antitrust law to revoke the sovereign immunity that has long protected OPEC and its national oil companies from lawsuits.

The bill must pass the full Senate and House and be signed by President Joe Biden to become law.

If passed, the US Attorney General would gain the ability to sue OPEC or its members, such as Saudi Arabia, in federal court. Other producers like Russia, which works with OPEC in wider group known as OPEC Plus to withhold output, could also be sued.

Saudi Arabia and other OPEC producers have rebuffed requests by the United States and other consuming countries to boost oil production beyond gradual amounts, even as oil consumption recovers from the COVID-19 pandemic and Russian supply falls after its invasion of Ukraine.

OPEC Plus, which cut production when oil prices crashed to historic lows when the pandemic slashed oil demand, had agreed to stick to its existing plans to reverse the curbs with modest increases for another month.

NOPEC is intended to protect US consumers and businesses from engineered spikes in the cost of gasoline, but some analysts warn that implementing it could also have some dangerous unintended consequences.

In 2019, Saudi Arabia threatened to sell oil in currencies other than the dollar if Washington passed NOPEC, a move that could undermine the dollar's status as the world's main reserve currency, reduce Washington's clout in global trade and weaken its ability to enforce sanctions on nation states.

Senator John Cornyn, a Republican from the top US oil producing state Texas, opposed the bill, saying it could prompt OPEC to restrict shipments to the United States.

"If we really want to deal with price at the pump we ought to produce more oil and gas here in America," Cornyn said.

The bill is also opposed by the American Petroleum Institute, the top US oil and gas lobbying group. In a letter to the committee's leaders, API said, NOPEC creates significant potential detrimental exposure to US diplomatic, military and business interests while likely having limited impact on the market concerns driving the legislation.

Some analysts have cautioned that NOPEC could ultimately harm domestic energy companies if it pressures Saudi Arabia and other OPEC members to flood global markets with oil, because they produce oil much more cheaply than US companies do.

 

OPEC Plus agrees deep oil production cuts

OPEC Plus agreed steep oil production cuts on Wednesday, curbing supply in an already tight market, causing one of its biggest clashes with the West as the US administration called the surprise decision shortsighted.

The de-facto leader of the cartel, Saudi Arabia said the cut of 2 million barrels per day (bpd) of output - equal to 2% of global supply - was necessary to respond to rising interest rates in the West and a weaker global economy.

The kingdom rebuffed criticism it was colluding with Russia, which is included in the OPEC+ group, to drive prices higher and said the West was often driven by "wealth arrogance" when criticizing the group.

The White House said President Joe Biden would continue to assess whether to release further strategic oil stocks to lower prices.

"The President is disappointed by the shortsighted decision by OPEC+ to cut production quotas while the global economy is dealing with the continued negative impact of (Russian President Vladimir) Putin’s invasion of Ukraine," the White House said.

Biden faces low approval ratings ahead of mid-term elections due to soaring inflation and has called on Saudi Arabia, a long-term US ally, to help lower prices.

US officials have said part of the reason Washington wants a lower oil price is to deprive Moscow of oil revenue. Biden travelled to Riyadh this year but failed to secure any firm cooperation commitments on energy. Relations have been further strained as Saudi Arabia has not condemned Moscow's actions in Ukraine.

Saudi Energy Minister Abdulaziz bin Salman said OPEC Plus had needed to be pro-active as central banks around the world moved to "belatedly" tackle soaring inflation with higher interest rates.

Wednesday's production cuts of 2 million bpd are based on existing baseline figures, which means the cuts would be less deep because the cartel fell about 3.6 million barrels per day short of its output target in August.

Under-production happened because of Western sanctions on countries such as Russia, Venezuela and Iran and output problems with producers such as Nigeria and Angola.

Analysts from Jefferies said they estimated the figure at 0.9 million bpd, while Goldman Sachs put it at 0.4-0.6 million bpd saying cuts would mainly come from Gulf OPEC producers such as Saudi Arabia, Iraq, the United Arab Emirates and Kuwait.

 

OPEC Plus thought of production cut annoys US

OPEC Plus looks set for deep oil output cuts in its meeting today (Wednesday), curbing supply in an already tight market despite pressure from the United States and other consuming countries to pump more.

The likely cut could spur a recovery in oil prices that have dropped to about US$90 from US$120 three months ago due to fears of a global economic recession, rising US interest rates and a stronger dollar.

The cartel that includes Saudi Arabia and Russia, is working on cuts in excess of one million barrels per day (bpd). Reuters reports the cuts could be as high as two million bpd if reductions could include additional voluntary cuts by members such as Saudi Arabia or if cuts could include existing under-production by the group.

OPEC has been under-producing over 3 million bpd and the inclusion of those barrels would dilute the impact of new cuts.

"Higher oil prices, if driven by sizeable production cuts, would likely irritate the Biden Administration ahead of US midterm elections," Citi analysts said in a note.

"There could be further political reactions from the US, including additional releases of strategic stocks along with some wildcards including further fostering of a NOPEC bill," Citi said referring to a US anti-trust bill against OPEC.

Saudi Arabia and other members of the Organization of the Petroleum Exporting Countries and allied producers (OPEC Plus) have said they seek to prevent volatility rather than to target a particular oil price.

The West has accused Russia of weaponizing energy as Europe suffers from a severe energy crisis and may face gas and power rationing this winter in a blow to its industry.

Moscow accuses the West of weaponising the dollar and financial systems such as SWIFT in retaliation for Russia sending troops into Ukraine in February. The West accuses Moscow of invading Ukraine while Russia calls it a special military operation.

A significant cut is likely to anger the United States, which has pressured Saudi Arabia to pump more to pressure oil prices and reduce revenue for Russia.

Saudi Arabia has not condemned Moscow's actions and relations are strained between the kingdom and the administration of US President Joe Biden, who travelled to Riyadh this year but failed to secure any firm cooperation commitments on energy.

Saudi Aramco CEO and President Amin Nasser said that the spare production capacity is not the responsibility of Saudi Arabia alone.

Nasser made the remarks on Tuesday during his speech at the Energy Intelligence Forum 2022 in London. He added that the spare capacity amounts to 1.5% of global demand.

The oil market does not focus on the fact that global spare capacity to increase oil production is very low, Nasser said.

He clarified that the market focuses on what will happen to demand if there is recession in different parts of the world. He also added that they do not focus on the supply fundamentals.

Nasser stressed that Aramco maintained its market in Asia despite European demand, while he pointed out that the problem of Europe lies in gas and liquefied gas due to the lack of spare capacity.

During his speech, Nasser expected that the demand for oil would increase until 2030 and beyond. He also added that Aramco is on track to raise its capacity to 13 million barrels per day by 2027, which would cost billions of dollars.

The Aramco's CEO remarks came about 24 hours before the meeting of the OPEC Plus meeting that will be held on Wednesday in Vienna, which is its first attendance meeting since March 2020.

The alliance is expected to reduce production by at least 500,000 barrels per day, while other expectations indicate the possibility of reducing by more than one million barrels per day.