June 30, 2008 – Page 1758
Twice in the past six months,
But all of that outward collegiality masked deep differences on the subject of oil prices, where the Saudis have rebuffed Bush and even scolded Wall Street investors who, the king says, have been heatedly speculating on oil futures to counter the falling value of the U.S. dollar. Abdullah repeated that message even more forcefully at an energy summit in Jeddah on June 22, where he pointed a finger at what he called “the frivolity in the market of speculators for selfish reasons” to explain the 40 percent surge in oil prices this year.
And lest anyone else be tempted to blame producers such as Saudi Arabia for the rise in energy prices, the king challenged his Western guests to “rule out biased rumors” about the causes for the price jump, find the real cause and make it public — “so as not to treat the innocent as wrongdoers.”
This is strong stuff in the context of the polite traditions of Saudi diplomacy. Abdullah’s public remarks and his announcement of a 200,000 barrel-a-day production increase — a symbolic gesture that will do little to lower prices at the pump — are indicative of a profoundly changed relationship between the United States and Saudi Arabia, with dimensions that reach far beyond the high price of oil, according to Mideast and energy experts.
“There is no denying that the relationship isn’t what it was,” said F. Gregory Gause III, an expert on Saudi Arabia at the University of Vermont. “There isn’t the kind of lockstep, where they basically did what we asked them to do.”
Indeed, what began more than six decades ago as a relationship based on a simple bargain of security for oil has grown increasingly complex over the years. During the Cold War, the United States and Saudi Arabia always managed to place their alliance against the Soviet Union above their differences over the Israeli-Palestinian conflict. And while the Sept. 11 attacks exposed deep-rooted resentment of each other among both Saudis and Americans, the shared historic agenda of oil and security helped the elites in both countries weather the crisis.
But U.S.-Saudi understanding has deteriorated steadily in the five years since the start of the war in Iraq, which has turned the Muslim world against the United States and which King Abdullah, in his first and most vehement public rebuke of Bush, bitingly condemned last year as “an illegal foreign occupation.”
Since the war began, the Saudis have watched with growing alarm as Shiite Iran, its main rival in the region, has grown in power, extending its influence westward into Iraq, Lebanon and the Palestinian territories. Because of traditional Saudi reserve, few Americans were aware of the royal family’s anger and frustration over the consequences of Bush’s Middle East policy.
But now, with oil prices at historical high points, the deterioration in relations is much clearer, as the Saudis make it plain that they are in no mood to do the United States any favors. The earlier relationship was characterized by Riyadh’s reflexive nod to Washington’s requests for oil production increases, but that’s no longer what the Saudis are willing or able to do.
That’s not to say Saudi Arabia has dropped its reliance on the United States for protection against its neighboring rivals. Later this year, the Saudis are expected to buy another $20 billion in U.S. weapons as a payment to the United States for its continued security commitment in the event the royal family faces an outside attack. And the nuclear energy cooperation agreement that Saudi Arabia signed with the United States last month serves as a signal to Iran that, if needed, Riyadh has options in that department, too.
But short of such drastic scenarios, the Saudis now prefer to keep the United States at arm’s length while they manage their internal and external affairs for themselves.
Although the United States and Saudi Arabia share some strategic goals in the region, including containment of Iranian influence in the Arab world, a unified Iraq that is not an Iranian client and a two-state solution to the Israeli-Palestinian conflict, Riyadh prefers its own approaches to these issues, as opposed to what it regards as the ill-advised policies of a U.S. president with diminishing influence.
And itis an attitude that Saudis leaders are increasingly bold in voicing. “We have never been a puppet state,” Foreign Minister Saud al-Faisal was quoted as telling the 150-member Shura Council, a group of tribal elders that advises the king, in March.
For the Bush administration, Saudi Arabia’s independent oil and foreign policies are causing numerous headaches, but as this month’s oil summit in Jeddah demonstrated, the president has few options other than to work with Saudi Arabia. In addition to Abdullah’s unwillingness to bend too far on U.S. demands for increased production, he is also defying Bush in his country’s approaches to several top-tier regional issues.
For example, despite Bush’s efforts to isolate Hamas, the militant Islamist Palestinian group that took control of the Gaza Strip last year from the moderate Fatah party, Abdullah continues to seek reconciliation between the two in an effort to unify the Palestinians and bring them into meaningful peace talks with Israel. Ignoring Bush’s entreaties, Abdullah also refuses to recognize the U.S.-backed government of Iraqi Prime Minister Nouri al-Maliki, which the Saudi king regards as an extension of Shiite Iranian influence into the Sunni Arab heartland. And as Bush continues his efforts to isolate Iran, Abdullah is reaching out to Tehran diplomatically in an effort to defuse tensions building across the Middle East as the U.S.-Iranian rivalry intensifies.
On one level, Saudi Arabia’s independent course grows out of its profound disappointment with Bush’s stewardship of Middle East policy and its utter lack of confidence in his ability during the final seven months of his presidency to douse the sectarian and communal fires now burning from Baghdad to Beirut to Gaza. But on a second and more enduring level, experts say, Saudi Arabia’s self-confidence reflects its coming of age as a regional power.
Once again flush with billions of dollars in oil revenue, the kingdom no longer needs the United States to help build its roads, utility lines and skyscrapers, to teach its professionals or to train its government bureaucrats. With global demand for oil rising, China, India and members of the European Union are courting the Saudis as intensely as are the Americans. And as long as these other countries remain willing to pay $130 or more for a barrel of oil, the Saudis, with ambitious new infrastructure projects of their own, don’t appear inclined to do anything to significantly lower the price.
This is the relationship with Saudi Arabia that either
“The old security-for-oil deal is dead,” said Marina Ottaway, the director of the Middle East program at the Carnegie Endowment for International Peace, a Washington-based public policy organization.
The alliance of the two countries was cemented Feb. 14, 1945, when President Franklin D. Roosevelt, returning from Yalta, met Saudi King Abdul Aziz ibn Saud on the deck of the USS Quincy as the cruiser lay at anchor in Egypt’s Great Bitter Lake, part of the Suez Canal. Ibn Saud, venturing outside his country for only the second time, brought a herd of sheep aboard to feed his entourage.
After a five-hour meeting, the king received the president’s assurances that the United States would remain committed to the security of Saudi Arabia after World War II, a pledge that effectively neutralized the British threat to the Saudi monarch’s reign after the war. In return, Roosevelt received Ibn Saud’s pledge that his country would keep an uninterrupted supply of oil flowing to the United States.
With the establishment of the Arabian American Oil Co., or ARAMCO, American oilmen helped the Saudis develop their petroleum industry. As profits began to roll in, the Saudis hired U.S. engineers and construction companies to transform the desert kingdom into a modern state with paved roads and new hospitals and schools. Once the projects were completed, more Americans arrived to instruct the Saudis in every subject from medicine to governmental budgeting.
“We were in Saudi Arabia, teaching them how to fly airplanes, how to do surgery, how to build electric power plants. We taught them how to sign their freeways,” said Thomas W. Lippman, a longtime student of Saudi Arabia at the Middle East Institute. “We had a relation with Saudi Arabia that amounted to professor and pupil.”
The relationship was not always so avuncular. While the Saudis sympathized with the plight of the Palestinians, successive U.S. administrations supported Israel, creating a constant undercurrent of tension between Riyadh and Washington. Indeed, the first major crisis in U.S.-Saudi relations came after the 1973 Middle East war, when President Richard Nixon’s decision to replenish Israel’s armory helped the Jewish state turn the tide of the war against Egypt and Syria. In an angry response, Saudi Arabia and other Arab oil producers cut off supplies to the United States. In March 1974, with a U.S. promise to negotiate a disengagement agreement between Israeli and Syrian forces on the Golan Heights, the Arab oil ministers agreed to end the embargo. But the Arab oil weapon had been born.
U.S.-Saudi relations grew stronger after Iran’s 1979 revolution, when Riyadh looked to Washington for protection as Tehran’s Islamic revolutionaries called for the overthrow of Arab monarchies. A year later, when the Iran-Iraq war broke out, the United States joined Saudi Arabia and the other Arab oil states in supporting Iraq’s Saddam Hussein by providing him with satellite intelligence on Iranian troop concentrations, while the Arabs financed Iraq’s war machine. In the eyes of the Saudi royal family, this joint U.S.-Arab effort, which forced Iran to sue for a truce in 1988, succeeded in containing the Shiite threat. During the same period, U.S. and Saudi intelligence agencies also cooperated to arm Afghanistan’s Mujahedeen in their successful fight against occupying Soviet troops.
In 1990, the United States and Saudi Arabia teamed up again, this time to confront Saddam after his invasion of Kuwait. More than 500,000 U.S. troops massed in Saudi Arabia for the 1991 counteroffensive that rolled back the Iraqi occupation but left Hussein in power as a balance against Iranian power in the Persian Gulf. The Saudis also picked up almost the entire tab for the war, contributing an estimated $55 billion.
U.S.-Saudi relations faced their second major crisis after the Sept. 11 al Qaeda attacks on the World Trade Center and the Pentagon. With the revelation that 15 of the 19 hijackers were Saudi, public opinion in the United States turned against Saudi Arabia, whose austere wahhabi brand of Islam was blamed for encouraging young Saudis to become terrorists. But with support from Bush — and an aggressive internal crackdown against alQaeda cells inside Saudi Arabia — the relationship weathered the crisis, once again proving its durability.
The U.S. invasion of Iraq in 2003 became the transformative event in the relationship between the two nations. As the implications of the invasion became clear, the Saudis saw a Middle East unfavorably transformed by Bush’s move. The war had strengthened Iran, Saudi Arabia’s Shiite rival, and Bush’s insistence on democratic elections in the region had brought to power Maliki’s Shiite-led government — which Saudi leaders regarded as an Iranian agent — as well as a Hamas-led government in the Palestinian territories, which Iran immediately embraced.
“To us, it seems out of this world that you do this,” al Faisal, the Saudi foreign minister, told a gathering of the Council on Foreign Relations in New York in 2005. “We fought a war together to keep Iran from occupying Iraq. . . . Now we are handing the whole country over to Iran without reason.”
Such remarks reflect not only the sense of betrayal that Saudi leaders have felt from Bush’s Middle East policies, but also their deep fear of the consequences that could grow out of the Shiites’ rise to power in Iraq.
“They’re left with some severe dangers, from their point of view,” said Juan Cole, a Middle East specialist at the University of Michigan. “They have a big Shiite population in the eastern province, al Hasa, which is where Saudi Arabia’s oil is pumped. A third of the workers on the oil rigs are Shiite. And they’re afraid of Shiite revivalism in Basra affecting al Hasa, which isn’t that far away. So it’s not just that they think the neighborhood has turned more dangerous for them; it also has domestic implications.”
Today, Bush and his top aides continue to urge Saudi Arabia to recognize the Maliki government, send an ambassador to Baghdad and forgive Iraq’s debt to Saudi Arabia, estimated at $15 billion. But Abdullah and the other senior members of the royal family cannot bring themselves to take what they see as such self-defeating steps. Instead, they have been backing Iraq’s Sahwa movement, the so-called Awakening Councils of Sunni tribesmen who once formed the backbone of the Iraqi insurgency against the U.S. occupation but who have since joined forces with U.S. troops against al Qaeda in Iraq.
Abdullah is also resisting Bush’s entreaties for Saudi Arabia to join in a U.S.-led Cold War-style alliance made up of the Sunni Arab oil states plus Egypt, Jordan and Israel to confront Iran and roll back its influence in the Middle East. For starters, Bush’s confrontational style is anathema to the Saudis — who, whenever possible, prefer to conduct their affairs quietly and out of the public eye.
Regional experts also note that while Saudi leaders recognize that Western powers may come and go in the Middle East, Saudi Arabia and Iran are fated by geography to be neighbors forever. With this in mind, the Saudis appear to have dismissed Bush’s approach and adopted that of Sun-Tzu, the 4th century BC Chinese general and military strategist who advised, “Keep your friends close, and your enemies closer.” In the past year, Abdullah has twice hosted Iranian President Mahmoud Ahmadinejad in Riyadh, and the king has invited an Iranian delegation to participate as observers at the annual meeting of the Gulf Cooperation Council. Saudi Arabia and Iran also have worked together to try to calm the crises in Iraq and Lebanon, despite Washington’s efforts to isolate Tehran and limit its influence in the Middle East.
Saudi Arabia and the other Arab states “are worried about Iran because it is the biggest player on the block and Iraq is no longer there to keep it under control,” said the Carnegie endowment’s Ottaway. “But they feel that the way to deal with the growing power of Iran is to talk to Iran, to deal with Iran, to maintain diplomatic relations with Iran, and if possible, to bring Iran into a regional security system.”
Cole compares Saudi policy toward Iran to that of U.S. policy toward the Soviet Union in the 1960s, noting that it was President Lyndon B. Johnson who installed the direct communications link between Washington and Moscow to facilitate leader-to-leader contact in a crisis. “The Saudis want a hotline to Tehran precisely because they are now toe-to-toe in so many arenas,” he said.
Abdullah also is resisting signing on to Bush’s anti-Iran coalition because it would necessitate the Saudis’ sitting together with Israel before there has been any real progress toward an Israeli-Palestinian peace accord — an issue that has deep resonance in Saudi Arabia and across the Arab and Muslim worlds.
Like the United States, Saudi Arabia sees the unresolved Israeli-Palestinian conflict as a benefit to Iran, which is supporting Hamas as part of its full-volume anti-Israel policy. But while the Bush administration has tried to isolate Hamas, the Saudis see continuing Hamas-Fatah tensions as pushing the Islamists further into the Iranian camp, says the University of Vermont’s Gause.
“The Saudis have no problems dealing with Islamists; they have done so for decades,” Gause wrote in a paper on Saudi and U.S. interests in the Middle East recently presented to the National Intelligence Council, which is made up of the directors of 16 U.S. intelligence agencies. “As their major regional priority now is to contain Iranian influence, they are willing to see complications in the peace process, which would be inevitable if Hamas were represented in the Palestinian authority, as an acceptable price for Palestinian unity and denying Tehran the ability to fish in those waters.”
While Saudi efforts to forge a reconciliation between Hamas and Fatah have failed in the past, they are not finished trying. This month, Saudi Arabia played a quiet role in another round of talks between the two rival Palestinian factions, this time in Senegal, Middle East experts said.
For all the irritation such moves have caused in Washington, Middle East experts such as Ottaway do not interpret Saudi Arabia’s policies as anti-American. “They’re more based on the fact that the United States is not doing the job at this point,” she said.
Saudi Arabia’s disquiet over the direction of U.S. policy in the Middle East is not the only factor fueling Riyadh’s new leadership role in the region. Also playing a role is the confidence that comes with today’s record price of oil.
In the past, when oil prices began to spike, the United States could count on Saudi Arabia to tap into its spare capacity to moderate the markets. But Riyadh no longer appears willing to play that role. In late 2006, it orchestrated two production cuts within OPEC to prevent the price of oil from falling below $50 a barrel. And even with its intention to boost production by 200,000 barrels a day, or about 2percent, to 9.7 million barrels daily, Saudi Arabia appears comfortable with $120-a-barrel oil, despite Bush’s entreaties and threats by some U.S. lawmakers to condition further arms sales to the kingdom on its willingness to increase production and cut the soaring price of gasoline.
“We are saying to the Saudis that, if you don’t help us, why should we be helping you,” Democratic Sen.
But wider concerns on Capitol Hill about the United States’ diminishing influence in the region make it unlikely Congress would hold up the administration’s planned arms sale to Saudi Arabia.
Bush has taken another approach. In his talks with Abdullah last month, he said, he stressed the view that high oil prices eventually would work against Saudi Arabia.
“I talked to King Abdullah about increasing the supply of oil, on the theory that if you harm your consumers with high prices they will find other ways to power their economies as quickly as possible,” Bush said in an interview with Britain’s Observer newspaper. “And secondly, he should not want to see kind of a worldwide contraction as a result of consumers spending money on energy that ends up overseas, as opposed to spending money on opportunities in their respective economies.”
But with emerging powers such as China and India feverishly courting Saudi Arabia to secure energy supplies, Saudi leaders see no reason to shortchange themselves on the commercial value of those relationships to please the United States. Besides, experts note, Saudi Arabia has an ambitious agenda for domestic spending that includes constructing new universities and starting six new cities from scratch, which Riyadh hopes will create jobs for its underemployed, young population.
Gause, who has closely monitored Saudi oil policy over the years, says there has been “a paradigm shift in where they want oil prices to be and how they see their role as the swing producer who levels thing out.” He added that the Saudis are loath to return to the days of cheap oil in the 1990s, when they were compelled to borrow from the United Arab Emirates to prop up their falling rial currency.
As the recent announcement of a production increase indicates, the Saudis may be getting nervous about the global economic consequences of oil prices remaining as high as $140 per barrel, Gause notes. “But they seem to have readjusted considerably upward what they think a ‘reasonable’ oil price is.”
Few Middle East watchers expect Saudi Arabia to abandon the leadership role it has carved out for itself in the region when the next president takes office in January.
If anything, Saudi leaders can be expected to appeal to either Obama or McCain to temper Bush’s policies of confronting Iran and to emulate their example of engaging Tehran while trying to contain it. Gause notes that if Iran acquires nuclear weapons, the Saudi response will depend largely on U.S. policy. “If Riyadh is confident of American security guarantees, Washington will have more leverage in pressing the Saudis not to try to develop their own nuclear force, probably through purchase from Pakistan,” he wrote in his briefing paper for the intelligence officials. “If Riyadh wonders about American commitment and credibility, the chances for Saudi proliferation go up.”
On the issue of Saudi policy toward Iraq, the next president can expect Riyadh to continue its support for the Sunni Awakening Councils, as well as other Sunni groups, and to step up that support considerably if U.S. troops are withdrawn to counter Iran’s own efforts to fill the resulting power vacuum. The last thing the Saudis want is a resumption of Iraq’s sectarian civil war between Sunnis and Shiites that could spill over into Saudi Arabia itself. But if Iraq goes down that road, “the Saudis know what side they will be on,” says Gause. In the meantime, Saudi leaders can be expected to quietly urge the next president to go slow on any troop withdrawal, despite any further public statements condemning the U.S. presence.
On the Israeli-Palestinian issue, the next president can expect Saudi Arabia to continue urging political reconciliation between Hamas militants and the moderate Fatah Party of Palestinian President Mahmoud Abbas. If such efforts fail, there will be little the Saudis can do to advance the peace process by themselves. But if they succeed, the next president may have to decide whether the United States would deal with a Palestinian government that includes Hamas members.
These are just some of the foreign policy challenges that await the incoming U.S. administration. How the next president handles them will go a long way in determining whether the tensions that have strained the U.S.-Saudi relationship since 2003 can be relieved. But he would be wise to keep in mind that the Saudi Arabia with which he’ll be dealing will not be the same country that previous presidents so easily bent to Washington’s visions of the Middle East and reasonably priced oil.
The relationship that Saudi Arabia had with America will never again be what it was in the 20th century — nor should it be, said Lippman. It now is a “much more normal relationship between grown-up countries.”
“Of course, the Saudis want to be in a position where we will, if necessary, come to their aid,” he said. “But they’re also now in a position where they aspire to leadership of the Arab and Islamic worlds, and that requires them to go their own way on certain things, and to be seen to go their own way.”
FOR FURTHER READING: Congressional energy debate, p. 1768; Bush’s Middle East policy, 2007 CQ Weekly, pp. 3580, 2984, 2001; global oil rivalries, 2005 CQ Weekly, p. 2384; Persian Gulf War, 1991 Almanac, p. 437.