Return of Syria to Arab League

According to Reuters, Syrian President Bashar al-Assad, a pariah for more than a decade, is expected to steal the spotlight at Friday's Arab League summit in Saudi Arabia, where he will rub shoulders with regional leaders who once backed his war foes.

Ostracized by most Arab states following his crackdown on protests against his rule in 2011 and the ensuing civil war, his government's return to the bloc is a signal that his war-battered country's isolation is ending. Saudi Arabia, Qatar and others for years supported anti-Assad rebels. But Syria's army, backed by Iran, Russia and paramilitary groups, has regained control of most of the country.

While Arab countries appear to have brought Assad in from the cold, they are still demanding that he curbs Syria's flourishing drugs trade and that war refugees can return. But it remains a striking recovery in the Syrian leader's fortunes.

"This is, indeed, a triumphant moment for Bashar al-Assad, being accepted back into the Arab League, the Arab world, after being shunned and isolated by it for over a decade," said David Lesch, a Middle East History professor at Trinity University in Texas.

Several states, including Qatar and Kuwait, had voiced their opposition to welcoming back Assad. But the summit will underscore how Qatar has scaled back its ambitions to be a major diplomatic player in the region and accept Saudi's preeminent role.

Assad is not the only divisive issue among Arabs. The League is also split over questions ranging from normalization with Israel and how to support the Palestinian cause, the regional roles of Turkey and Iran, and which side to pick in polarized global politics.

Also present in the Red Sea city of Jeddah are envoys for Sudan's warring military factions. That ongoing conflict is expected to dominate discussions. Saudi Arabia has been hosting talks on a ceasefire and humanitarian issues in Sudan for weeks.

The kingdom wants to send a message to the global community that Arabs will work together, said Abdullah Baaboud, the State of Qatar Chair for Islamic Area Studies at Waseda University in Tokyo.

"That also helps it (Riyadh) not only in term of its status within the Middle East but also beyond that when it comes to dealing with international powers, whether it is the United States, Europe or China," Baaboud said.

Washington has been skeptical about Assad's return to the Arab fold. A bipartisan group of US lawmakers introduced a bill last week intended to bar US recognition of Assad as Syria's president and enhance Washington's ability to impose sanctions.

The Syrian crisis and other regional conflicts including Yemen and Libya, pose further challenges for the Arab League, which is often undermined by internal divisions. Arab leaders argue that security is more important than democracy.

"There has been indeed in the past few years a willingness by Saudi Arabia and other regional actors to consolidate a form of authoritarian stability in the region," said Joseph Daher, a professor at the European University Institute in Florence, Italy.

"Despite continuous rivalries among various states...they hold a common position in wanting to return to a situation similar to that in place before the uprisings in 2011."

This year's summit also comes as Egypt, Tunisia and Lebanon struggle with runaway inflation, unemployment and popular anger.

Saudi Arabia and the United Arab Emirates, however, have set a new tone for times of crisis, saying the era of no-strings attached to help that the Gulf states offer others is over.

 

Pakistan: Ruling junta seems least concerned about FY24 Federal Budget

Today is May 17, 2023 and the Federal Budget for next Financial Year (FY24) is scheduled to be announced on June 02, 2023. I hardly see any debate in the print or electronic media on the likely facets of the Budget.

The growing concern among the analysts is that the incumbent government will accept all the conceivable conditions of the International Monetary Fund (IMF) to get the withheld tranche released, amounting to roughly one billion US dollar.

The analysts have this perception based on the fact that meeting the IMF conditions will be the headache of next elected government.

They also have the consensus that in the next budget the existing tax rates will be increased and new taxes will be introduced. On top of that super tax will also be introduced.

Along with this, subsidies will be withdrawn, levies applicable on energy products will be increased.

The government will not be able to boost exports or contain imports.

The quantum of informal import ill increase.

The quantum of PSDP will also be reduced.

The bottom line is, GDP growth will remain below one percent or negative.

The most alarming point is that the government will not be able to offer any income support program, poor will get poorer and rich will get richer.

 

 

 

 

 

 

 

 

 

Quad meeting scheduled in Sydney postponed

Australian Prime Minister Anthony Albanese said on Wednesday the Quad summit would not go ahead in Sydney next week without US President Joe Biden, who postponed his trip to Australia due to debt ceiling negotiations in Washington.

Albanese said the leaders of Australia, the United States, India and Japan would instead meet at the G7 in Japan this weekend, after Biden canceled a trip to Sydney on the second leg of his upcoming Asia trip, which was also to have included a visit to Papua New Guinea.

"The Quad leaders meeting will not be going ahead in Sydney next week. Though, we will be having that discussion between Quad leaders in Japan," Albanese told a news conference.

A bilateral program in Sydney with Indian Prime Minister Narendra Modi could still go ahead next week, Albanese said.

Albanese did not comment on whether Japanese Prime Minister Fumio Kishida would still visit Sydney next week

The Quad is an informal group that promotes an open Indo-Pacific. Beijing sees it as an attempt to push back against its growing influence in the region.

Asia Society Policy Institute senior fellow Richard Maude said the cancellation of Biden's visit to Papua New Guinea, which would have been the first visit by an American president to an independent Pacific islands nation, could set back Washington's battle for influence with Beijing in the region.

“The mantra in the region is all about turning up. Turning up is half the battle. China turns up all the time, and so the optics aren’t great,” Maude, a former Australian intelligence chief, told a panel discussion on the Quad on Wednesday.

India and Australia are not part of the G7 group of seven rich nations - Britain, Canada, France, Germany, Italy, Japan and the United States - but have been invited to attend the summit in Japan.

 

Kazakhstan and Russia to construct gas pipeline up to China

Kazakhstan and Russia have established the route for a future gas pipeline to support shipments between the two countries and to China, Kazakhstan's energy minister said on Tuesday.

The pipeline would help Russia, hit by Western sanctions over its invasion of Ukraine to boost sales of its energy and commodities in Asia while also ensuring that Kazakhstan secures supplies for its central, northern and eastern regions.

"The issue of building a gas pipeline from Russia through the northern territories of Kazakhstan to China is being discussed, the route has been preliminarily determined, the conditions for the construction of this gas pipeline are being discussed," Kazakhstan's energy minister Almasadam Satkaliyev said.

Russia has been discussing a possible gas union with Kazakhstan and Uzbekistan to support shipments between the three countries and to other energy buyers, including China.

Russia's pipeline gas exports to Europe, which used to be the main supply market for oil and gas from Russia, almost halved last year following the start of what the Kremlin says is a special military operation in Ukraine.

To make up for the loss of the European market, Moscow is forging close trade and political ties with Asia, which has become the main buyer of Russian oil, a major source of revenue for the Kremlin.

Keen to increase sales of natural gas to China, Russia has been in talks with Beijing on the construction of a second pipeline, the Power of Siberia 2, with an annual capacity of 50 billion cubic meters (bcm), roughly in line with the 55 bcm capacity of the damaged and idled Nord Stream 1 undersea pipeline to Germany.

The talks have been fractious and there is still no agreement on the gas price.

Last year, Kremlin-controlled Gazprom also agreed to supply Chinese state energy major CNPC with 10 bcm of gas each year from Russia's far eastern island of Sakhalin.

Currently, Russia supplies China via the only one route - Power of Siberia pipeline, which is expected to reach full annual capacity of 38 bcm by 2025.

 

 

United States: Refiners build new oil processing facilities

US oil refiners aim to run at up to 94% of a total 17.9 million barrels per day processing capacity this quarter, according to company forecasts and analysts, driven in part by expectations of seasonal travel demand.

Strong prices and demand since late 2021 have encouraged refiners to run above 90% of their processing capacity and in a sign that they expect fuel demand to remain high, two refiners have added units or enhanced their output, reviving a once routine practice that disappeared amid COVID-19 closures.

This quarter is traditionally one of the year's hottest for demand as companies build gasoline and jet fuel output for the summer vacation season. Motorist group AAA on Monday predicted the May 27-29 Memorial Day holiday weekend will be the third busiest for auto travel since 2000 and most active at US airports since 2005.

This quarter's pace compares to 91.3% utilization in the year-ago quarter and the 71.5% and 87.8% run-rates in 2020 and 2021 as the industry struggled with COVID-19 lockdowns that reduced fuel consumption and crushed industry profits.

Behind the higher run-rate is the fact that motor fuel stocks are beneath their 5-year averages. Gasoline and distillates inventories are 7% and 16% below, investment firm Tudor Pickering Holt & Co estimated.

"Demand trends are strong in gasoline and jet (fuel)," said Matthew Blair, a managing director at Tudor Pickering. He estimates refiners overall will run at 94% utilization rate this quarter, matching the 2017-19 average for the period.

Among larger refiners, Marathon Petroleum plans to run at 91% of capacity, Valero Energy at between 90% and 93%, and Phillips 66 in the mid-90s, officials said.

"I would expect utilization to go up a couple of points (this quarter)," from the early May run rate of 91%, said David Hackett, chairman of fuel consultancy Stillwater Associates.

High prices will keep US refinery utilization rates at levels near last year's about 91.7% this year and next, the US Energy Information Administration forecast in January 2024.

Refiners will add the capacity to process an additional 328,000 bpd in this quarter, increasing gasoline and diesel supplies this summer.

Exxon Mobil added 250,000 bpd at its Beaumont, Texas, refinery; Citgo Petroleum Inc 38,000 bpd at its Lake Charles, Louisiana, plant; and Marathon Petroleum Corp 40,000 bpd at its Galveston Bay Refinery in Texas City, Texas.

Two others whose refineries were offline last quarter - Suncor's in Commerce City, Colorado and Cenovus in Superior, Wisconsin, are resuming operations.

"Margins are not going to be as robust as they have been in the past year and a half," said John Auers, managing director of Refined Fuels Analytics.

 

 

Iran-Pakistan development of special relations

Iranian parliament will table a special package for the development of relations between Iran and Pakistan, said Vahid Jalalzadeh, who is the head of the Iranian Parliament’s National Security and Foreign Policy Committee. He made the remarks at a gathering hosted by Pakistan Council on Foreign Relations in Karachi. 

Jalalzadeh has paid a visit to Pakistan at the head of an Iranian parliamentary delegation. 

He lauded the cultural commonalities between Iran and Pakistan, saying, “Persian language is a strong factor of the proximity of two neighboring countries and both countries are proud to recognize each other as the first country.”

Jalalzadeh added, “As Ayatollah Raisi, the president of the Islamic Republic of Iran, has emphasized, we do not consider any limits to expand bilateral cooperation with Pakistan in all fields. The heads of the two countries have had two official meetings in the last one year and we will see another meeting soon.” 

He noted, “We will certainly put a special case for the development of relations with Pakistan on the table of the Islamic Majlis. The main focus is on expanding commercial and economic cooperation between the two countries and encouraging governments to use mutual capabilities, especially persuading the private sector in order to identify the capacities of Iran and Pakistan.

According to Jalalzadeh, the Islamic Republic of Iran welcomes China's investment in Pakistan, and everyone in Iran wants a prosperous, developed and stable Pakistan.

“The Islamic Republic of Iran will never involve any third country in the discussion of bilateral relations, either with Pakistan or other countries, and what is important to us is maintaining and achieving bilateral interests,” he said, according to IRIB News.

Hossein Nourian, Iran’s Consul General in Karachi, also addressed the gathering, underlining the need for the expansion of trade between Tehran and Islamabad. 

“The two neighboring countries intend to use the common borders not as a threat but as a special opportunity to strengthen people-to-people relations and develop bilateral trade,” he said. “The level of trade between Iran and Pakistan crossed two billion dollars for the first time last year, and the two countries are trying to increase these relations to five billion dollars in the first step.”

Pakistan has recently appointed a new ambassador to Iran that has extensive experience working in China, a Pakistani news outlet reported.

The new ambassador, Muhammad Mudassir Tipu, previously served as the Director General (China) and Consul General to Chengdu, Gwadar Pro reported. 

This appointment is seen as a positive development that can foster closer ties between Pakistan, China, and Iran, particularly in the context of the China-Pakistan Economic Corridor (CPEC), the outlet added. 

Song Zhihui, the Director of the Pakistan Study Center at Sichuan University, underlined the importance of the appointment of Tipu. He highlighted that Iran's growing geopolitical importance, particularly in light of the Saudi-Iranian reconciliation facilitated by China, makes this assignment crucial, according to the Pakistani outlet.

 

 

Iran: World’s top oil pipeline developer

Global Energy Monitor, in a recent report, has said Iran is the world’s top country in terms of oil pipelines under construction.

Based on the report, the Iranian Oil Ministry is also among the world’s top oil pipeline developers.

According to new data from Global Energy Monitor, Africa, and West Asia are home to 49% of all oil transmission pipelines under construction globally at a cost of US$25.3 billion.

The 2023 annual survey of data in the Global Oil Infrastructure Tracker shows that these regions together are building 4,400 kilometers (km) of crude oil transmission pipelines at an estimated capital expenditure of US$14.4 billion.

An additional 10,800 km are proposed in these regions at an estimated cost of US$59.8 billion.

Globally, there are 9,100 km of oil transmission pipelines under construction and an additional 21,900 km of proposed pipelines. These pipelines in development are estimated to cost US$131.9 billion in capital expenditure.

The total 31,000 km of oil pipelines in development globally represents an increase of nearly 30% from this time last year.

The leading five countries in terms of in-development pipelines (proposed and under construction) are Iran, the United States, India, Iraq, and Tanzania.

The top five parent companies developing oil pipelines are state-owned enterprises and private companies, including Iran’s Oil Ministry, the China National Petroleum Corporation, Iraq’s Ministry of Oil, India’s Numaligarh Refinery Limited, and France’s TotalEnergies.

The longest pipeline projects under construction are the 1,950-km Niger–Benin Oil Pipeline and the Paradip Numaligarh Crude Pipeline (PNCPL) in India, both slated to start operating in 2024.

Canada is home to the third-largest pipeline project under construction, the 980-km Trans Mountain Expansion (TMX), expected to start in 2023 as an expansion to the existing Trans Mountain Oil Pipeline.