It is a fact that Saudi oil facilities were attacked by a combination of drones and cruise missiles. Evidence may be emerging that some or all of the devices were manufactured in Iran. So far, there is no credible, let alone indisputable, proof that these were launched from Iran and by Iranian forces. All the while, American and Saudi speculations about the launch’s origin and pointing the finger at Iran take us closer to war.
Even if all of the drones and cruise missiles were produced in Iran, a legitimate response could be “what’s new, superpowers have been selling lethal arms to dictators for years.” Importantly, no one died in the Saudi attack.
Moreover, the Iran-backed Houthis that claimed responsibility for the attack are Yemenis who face indiscriminate Saudi bombing in their country. Surely they have a legitimate right to retaliate by attacking Saudi facilities.
On the other hand, by bombing another state, Saudi Arabia is committing war crimes. Nearly all the bombs dropped on Yemeni civilians, with casualties in the tens of thousands, were manufactured in the United States. The U.S. also provides the Saudis with intelligence and mid-air refueling. By implicating Iran for providing the Houthis with a few drones and missiles, the U.S. is inadvertently shining a much brighter spotlight on itself, its relation with Saudi Arabia, and on the atrocities in Yemen.
The U.S. should be cautious about accusing Iran without ironclad evidence as its marriage to Saudi Arabia is much more intense than Iran’s relations with the Houthis. There could be a devastating blowback for the U.S., not just in the Middle East but the world over.
Fallout of Oil Prices
The fallout for oil prices has been as expected. Oil prices initially spiked but retreated when it became obvious that further attacks on Saudi facilities were, for the moment, unlikely and that the shortfall could easily be handled from stored oil reserves in other countries and higher oil output elsewhere.
The pattern of oil prices is almost the same as in the aftermath of Saddam Hussein’s 1990 invasion of Kuwait. There is, however, one difference. Oil prices will now exhibit a sustained jump of about $2 a barrel to reflect the new reality that oil supplies are vulnerable. Markets had not factored in such attacks, and this was not an issue in the earlier disruptions of the First and Second Gulf Wars.
The most recent assumption was that Saudi, Kuwaiti, Emirati, and Qatari supplies were impenetrable because of the American missile shield and the country’s sophisticated military presence. The attack on Saudi facilities has obliterated this myth. In addition to this step-up in prices for the foreseeable future (unless Iran-Saudi relations improve), there remains the very real possibility of a further deterioration of Iran-Saudi and, even more importantly, Iran-U.S. relations, which could impact oil prices on a scale not seen since the Arab Oil Embargo of 1973.
Undoubtedly, the attack on Saudi oil facilities has heightened Iran-U.S. and Iran-Saudi tensions. But matters are much worse than they appear on the surface because several divisive issues have been given more fuel.
Bin Salman’s Saudi Arabia
While Iran-Saudi ties were bad, still the two countries were somewhat willing to engage in cautious dialogue. This has been ruptured. Saudi Arabia is now ruled by the ambitious young Mohammed bin Salman, who is feeling his oats.
He has forged close ties with President Donald J. Trump and his son-in-law, Jared Kushner. Bin Salman has entered into dialogue with Israel; acquired more sophisticated weaponry; sees an Iran weakened by relentless U.S. sanctions; and feels he can do anything and get away with it, as shown by the cold-blooded murder of dissident journalist Jamal Khashoggi.
His behavior eerily resembles that of Saddam Hussein when he invaded Kuwait – believing that the U.S. would support him no matter what he did. The U.S. has exited the nuclear deal with Iran, isolating the country further. Israeli Prime Minister Benjamin Netanyahu (still in power as of this writing) is ready to attack Iran if the U.S. is willing to support such an adventure.
Most important in all of this is Trump’s backing, something that may expire with the U.S. elections in 2020. Time may be bin Salman’s worst enemy.
Iran-US Ties
The likelihood of an Iran-U.S. war is ever more likely because of Washington’s misreading of the Iranian leadership, their intentions, and their reaction to U.S. policies. The U.S. administration has no reliable source on Iran. U.S. advisors on Iran have not had good access to the leadership of the Iranian government: the clerics, the intelligence services, the Revolutionary Guards, and the military.
The U.S. is adopting policies largely in a vacuum, with little or no understanding of how Iran may react. Washington’s rhetoric in the aftermath of the attack on Saudi oil facilities is a case in point. Secretary of State Mike Pompeo almost immediately, and without clear evidence, accused Iran. President Trump stated that U.S. forces were “cocked and loaded.” More recently, on September 18, Trump instructed the U.S. Treasury to further tighten sanctions on Iran, an empty threat as Iran is already sanctioned to the max.
In the face of all these accusations and threats, Trump offers to meet the President of Iran, Hassan Rouhani. This indicates no understanding of Iran. The Iranian leadership does not trust the U.S. administration. Colin Powell, secretary of state under President George W. Bush, presented false evidence to justify the invasion of Iraq. The U.S., while espousing neutrality, implicitly backed Saddam Hussein’s invasion of Iran and supplied Iraq with internationally banned chemical weapons. The U.S. pulled out of the nuclear deal. The word of a U.S. President is of no value, especially the word of this president.
Most importantly, the Trump administration does not appreciate the fact that those who head Iran’s intelligence services and Revolutionary Guards don’t react well to threats. They realize that if they buckle in the face of Trump’s threats, they will be chewed and spit out by the nation. They will stand firm and retaliate against U.S. interests across the Middle East.
On the other side, President Trump seems to view this as just another real estate transaction: make threats, walk away, back down, come back, and make the most beautiful deal. The two sides are far apart.
Escalation
If Trump continues on this path, he would take America’s duplicity to new heights and its credibility to new lows – attacking Iran for supplying the Houthis with a few missiles and drones while it sells nearly every lethal weapon known to man to Saudi Arabia that has killed tens of thousands and displaced hundreds of thousands in Yemen.
It is a path with only escalations on the horizon, making an all-out war inevitable, not just on the borders of Iran but all over the Persian Gulf including Iraq, Lebanon, onto Israel and possibly across a number of other Muslim countries.
Even if such a war would be limited to the Persian Gulf, oil prices could spike up to around $300 a barrel. If such a conflict does not enjoy a quick end, prices will sustain at levels above $100 for years to come.