Shunning Qatar is beginning of another proxy war

About two days back I had posted a link to one of my blogs “Arabs Falling in Deadly US Trap” posted as back as in July 2012. One of my critics asked the reason for my obsession for proxy wars. In my various blogs I have stated that after the World War II, superpowers have learn a lesson “fight a war away from their homelands”.

Termination of diplomatic relationship with Qatar by various Arab countries led by Saudi Arabia is aimed at achieving two objectives, dragging Iran into another proxy war and stopping energy supplies from Qatar to hike oil prices through geopolitical maneuvering. Let everyone remember that the biggest beneficiery of yet another proxy war will be the United States. If anyone doubts my words he/she should peep into the history of Iraq’s attack on Iran and Kuwait.

Another conspiracy theory is that the reason for making an attempt to isolate Qatar is the ongoing transmission of Al Jazeera TV, which is critical of the atrocities of Arab monarchs, particularly in Yemen and Bahrain.

The latest acquisition that Qatar is supporting the extremist groups does not look very different from the allegation of the presence of weapons of mass destruction in Iraq and OBL residing in Afghanistan. The allegation against Qatar also appears a hoax call. However, one just can’t rule out bloodshed in Qatar like it was done in Iraq and Afghanistan.

Pakistan Stock Market Takes a Dip of Nearly 8 Percent

With announcement of FY18 Deferal Budget and Pakistan’s formal inclusion in the MSCI EM Index, the week ended 2nd June 2017 remained eventful. Contrary to the expectations, fiscal prudence superseded election year populist measures in the Budget, while unexpected tax restructuring for the stock market induced further volatility (15% CGT regardless of the holding period, enhancement of tax on dividend to 15%). On the other hand, the transition to MSCI EM Index triggered a sell‐off on the likely rebalancing of the portfolios. The benchmark of Pakistan Stock Exchange index lost 4082 points or 7.75%WoW to close the week at 48,555. The average daily volumes declined to around 295 million shares, but the average traded value soared to its decade high of over US$240 million. Other key news flows during the week included: 1) Hussain Nawaz appearing before the JIT, 2) CPI based inflation in May’17 rising to over 5%, at 30‐month high, 3) GoP reducing the MOGAS/HSD prices, 4) LHC dismissed petitions filed by commercial importers against the anti‐dumping duty on flat steel products, 5) MoF reportedly agreed to provide Rs45 billion to IPPs and OMCs in lieu of circular debt. MSCI Pakistan EM index large and mid‐cap constituents were major losers during the week, where: HBL, LUCK, UBL, MCB and OGDC.With Pakistan formally part of MSCI EM Index, analysts expect short‐term volatility to continue where the market is likely to take guidance from foreign activity. That said, any development with regards to the revised margin financing product along with Panama‐gate’s JIT proceedings are likely to drive sentiments accordingly.

As eventful as it was, the market gained 2.6%MoM during May'17 in anticipation of a populist budget while gearing up for Pakistan's formal inclusion in the MSCI EM index. However, gains remained limited (the market lost 4% since the presentation of Budget FY18) where, contrary to expectations, fiscal prudence superseded election year populist measures in

Budget FY18. Also, an unexpected tax restructuring for the stock market induced further volatility. On the other hand, the transition to MSCI EM Index triggered a sell‐off with the benchmark index losing 1.7%, just a day before formal inclusion of Pakistan in MSCI EM. In this regard, profit taking was evident in MSCI EM stocks with traded value recorded at US$508.7 million, touching its decade high. Going forward, foreign activity is likely to guide the market sentiments in the short term with the market seeing increased volatility until complete re‐balancing of portfolios. However, analysts expect key themes like: 1) materialization of CPEC projects, 2) healthy corporate earnings growth, 3) interest rate reversal and 4) the pressures on the PkR to take center stage until general elections next year.

Despite widening trade deficit, rising by nearly 37% in 10MFY, focus on export‐oriented sectors remained missing in the recently announced FY18 budget. While relief measures under the export package (zero‐rating regime, discounted EFF & LTTF and duty‐free machinery import) were extended and new protectionist measures introduced (GST @10% on import of fabric and 5% RD on import of filament yarn), no solid initiatives were undertaken with regards to energy subsidy (to reduce power cost) and refund claims except allowing of payment of refunds. Moreover, the 1% increase in GST on retail sales to 6% further add to the woes of industry players having a  higher proportion in the local sales mix should they choose not to pass on the cost increment to consumers.

Britain must keep Tony Blair out of Brexit discussion

Having roots in Pakistan, once upon a time a British Colony and a member of Common Wealth for a long time, I believed that Britain was the oldest democracy. However, this belief has been shattered after hearing that its ex-prime minister Tony Blair would steer the country out of the turmoil. In my opinion, he should have been punished for committing war crimes, the worst being his support for Iraq invasion on the premise of having weapons of mass destruction. Ideally, he should be hiding his face because tendering an apology could not save him from the ultimate fate.

In the recent past, I was engrossed with other topics that included Pakistan’s prime minister, Nawaz Sharif, facing disqualification, US president not behaving in the desired manner and his visit to Saudi Arabia, elections in Iran and ongoing war in my country’s neighborhood, Afghanistan. I confess that I missed statements of Tony Blair saying that he plans to become more involved in the debate surrounding Britain’s departure from the European Union because of the harm it would cause the country.

The 63-year-old, who was speaking on the 20th anniversary of his landslide win over John Major in the general election of 1997, told the Daily Mirror, “I am going to be taking an active part in trying to shape the policy debate and that means getting out into the country and reconnecting. This Brexit thing has given me a direct motivation to get more involved in politics. You need to get your hands dirty, and I will.” I believe Britishers should not pay any heed to his uttering.

I regret that Britisher, who are the custodian of democracy and good behavior gave him a chance to resurface, whereas he should have been completely dumped for bringing the worst disgrace to them. I will even ask a question, are the politicians from treasury and opposition benches incapable of bringing the country out of the turmoil?

My question to Tony Blair, if he is such an ardent supporter of Britain remaining in the European Union (EU), why did he keep his country out of the common currency, euro? I understand that somewhere at the back of his mind was that if Britain joins euro; it would become subservient to Germany and France.

At this juncture, both Germany and France are adamant at punishing Britain out of the EU or be ready to pay a huge cost to stay its member. If Tony Blair committed a mistake of becoming the spokesman of war monger George Bush and now living in isolation, Britain also faces isolation for its decision to quit the community. Even if the new parliament wishes to reverse the process, it would only be at the stringent conditions of the EU.

OPEC becoming subservient to US Shale oil producers

I will prefer to say at the outset that Saudi Arabia has become subservient to the US administration. Zionists, god-fathering Israel, have succeeded in creating the perception ‘Iran is a bigger threat.’ This has helped the US in soliciting arms orders worth US$350 billion.

Now, OPEC-led by Saudi Arabia, is being convinced to allow US Shale oil producers to increase their output under ‘mutual coexistence’. Both the Saudi decisions indicate that its foreign and economic policies have become subservient to the US.

The history of the relationship between OPEC and the US shale oil industry has evolved a great deal since the cartel discovered it (OPEC) has a monstrous rival eating up its market for around five years.

To convince Saudi Arabia to give more space, US bankers providing funds to Shale oil producers came to Vienna and key OPEC members are getting readying visit Texas in a bid to understand whether the two industries can coexist or are poised to embark on another major fight in the near future.

The complete surrender by the Saudi Arabia is evident from the statement of Khalid al-Falih, its Oil Minister, who said, "We have to coexist." One can recall that he pushed through OPEC production cuts in December, reversing Riyadh's previous strategy of pumping as much oil as possible and try to push US Shale oil producers out of business, by keeping oil prices low.

OPEC has already decided to extend a helping hand to US Shale producers, but keeps seeking supplies at a level to hold prices below $60 per barrel.

Some analysts believe that now OPEC realizes supply cuts and higher prices only make it easier for the shale industry to earn higher profit after it found ways of slashing costs.

Iran that has already consented to support Saudi Arabia justifies its decision. "For all OPEC members $55 (per barrel) and a maximum of $60 is the goal at this stage," said Bijan Zanganeh, Iran's oil minister. "This price level is not high enough to encourage too much shale? It seems it is good for both."

Some OPEC members seem keen to show they have shed any prior naivete about shale, making it a key topic during Thursday's meeting after barely mentioning it before. Shale's limitations, including rising service costs, also were discussed.

"We had a discussion on (shale) and how much that has an impact," said Ecuador Oil Minister Carlos Pérez. He expressed helplessness, "But we have no control over what the US does and it's up to them to decide to continue or not?"

"In terms of the threat, we still don't know how much (U.S. shale) will be producing in the near future," Nelson Martinez, Venezuela's oil minister said after the talk.

OPEC meets again in November to reconsider output policy. While most in the group now appear to believe that shale has to be accommodated, there are still those in OPEC who think another fight is around the corner.

"If we get to a point where we feel frustrated by a deliberate action of shale producers to just sabotage the market, OPEC will sit down again and look at what process it is we need to do," said Nigerian Oil Minister Emmanuel Kachikwu.

President Donald Trump: An Ace Arms Seller

At the first destination, Saudi Arabia, U.S. President Donald Trump succeeded in signing an arms sale agreement worth US$350 billion.  He is likely to secure more orders on visits to Egypt, Jordan, Turkey and Israel. Arms sale in on the themes: campaign against ISIS and terrorism, challenge of Iran and turmoil in collapsing states of Syria and Yemen.  But the top item on the agenda is Israel-Palestinian peace process, which the president said was a top priority for his administration, through its recognition by Arabs.

Trump’s rhetoric is based on “Iran is a bigger threat as compared to Israel”.  The U.S. assault started with Iraq’s attack on Iran soon after the Islamic Revolution. Arab monarch’s were made to believe (by the U.S.) that the fall of Iran’s monarch was the beginning of their downfall. The war continued for almost a decade. Later on, Iraq was prompted to attack Kuwait, one of the best friends of Saudi Arabia.

In the aftermath of 9/11 U.S. attacked Afghanistan and Iraq. Further stringent sanctions were imposed on Iran. However, the superpowers agreed to withdraw these sanctions on the condition that Iran would roll back its nuclear program. To project Iran as enormous threat, it has been dragged into proxy wars to weaken it and to portray that “Iran is not a regional superpower”.

The need to create this perception aroused, after the emergence of Hezbollah, which smashed Israel’s military superiority.  Therefore, Iran has to be constantly engaged in wars. A question remains unanswered who initiate the assault, Iran or others? The western media has been arousing anti Iran sentiments by capitalizing Arab-Iran hatred.

The ultimate objective, which the U.S. wishes to achieve is “Recognition of Israel by Arabs”. The process started when Muhammad Anwar el-Sadat was president of Egypt and continued till his assassination on 6 October 1981. It seems most of the Arab are already convinced and are desperate for making the formal announcement. However, they have not forgotten the fate of Anwar Sadat.

One of the expectations is that at the end of Trump’s visit the formal announcement will come. Therefore, all the guns have to be aimed at Iran, which is often considered “the game spoiler”. But one has to try to find an answer to the question what is the cost of this recognition? Why Saudi Arabia  has to pay US$350 billion to give a boost to the U.S. economy?