07/7/15

Is Saudi Arabia Leaving The U.S. Behind For Russia?

The news from the recent St. Petersburg Economic Forum, which took place from June 18 to 20, inspired a torrent of speculation on the future direction of energy prices.

But the real buzz at the conference was the unexpected but much publicized visit of the Saudi Deputy Crown Prince, as an emissary of the King. The Prince, who is also his country’s Defense Minister, carried the royal message of a direct invitation to President Putin to visit the King, which was immediately accepted and reciprocated, with the Prince accepting on behalf of his father.

It would be news enough that the unusually high level delegation from a long-time ally and protectorate of the U.S., like Saudi Arabia, was visiting a Russian sponsored economic conference, in a country sanctioned by the U.S.

Some saw this well publicized meeting as the first sign of an emerging partnership between the two greatest global oil producers. If the warmth of the meeting was any evidence, it seems likely that Russia, a non-OPEC producer, might come a lot closer to the fold.

That could mean that, at the very least, Russia would have a voice in the cartel’s policy decisions on production. And if so, it would be a voice on the side of stable but rising prices.

The great Indian journalist, M.K. Bhadrakumar (MKB), may have been the first to point out that there was plenty of reasons for the Saudis and Russians to come closer together. Among these are the U.S.’ diminishing dependence on Middle Eastern energy, due to the momentous development of shale resources. There’s also the over-riding goal of the U.S. to pivot toward the East, where a huge economic transformation is unfolding, while reducing the U.S. role in the Middle East. It’s clear that the Saudis are going to have to make new friends.

MKB also makes the point that although the Saudis are wildly opposed to any form of U.S. entente with Iran, the clear-eyed Kremlin understands that there are many temptations for its erstwhile ally, Iran, to move much closer to the West.

Pepe Escobar of Asia Times saw the Prince’s visit as harboring the first glimmer of light in ending the current global oil trade war, in which the Saudi’s might turn down the spigot and lower production, enabling prices to rise: “Facts on the ground included Russia and Saudi Arabia’s oil ministers discussing a broad cooperation agreement; the signing of six nuclear technology agreements; and the Supreme Imponderable; Putin and the deputy crown prince discussing oil prices. Could this be the end of the Saudi-led oil price war?”

Bullish oil traders thought they found some hope in the words of Ali al-Naimi, the famous and longtime President and CEO of the Saudi National Oil Company, Aramco, and current oil minister. Naimi publicly stated: “I am optimistic about the future of the market in the coming months in terms of the continuing improvement and increasing global demand for oil as well as the low level of commercial inventories.” This, the minister said, should lead to higher oil prices by year’s end.

Ali al-Naimi publicly praised the enhanced bilateral cooperation between Riyadh and Moscow, stating that, “[t]his, in turn, will lead to creating a petroleum alliance between the two countries for the benefit of the international oil market…”

This could be music to the ears of oil price bulls. But more skeptical minds were quick to clamp down excessive optimism. “Of course, we shouldn’t read into any new developments outside political frameworks, because I can hardly imagine that Saudi Arabia has decided to turn against its alliances—but it probably wants to get out of the narrow US corner and expand its options,” Abdulrahman Al-Rashed, the General Manager of Al Arabiya News Channel, wrote in a column after the summit.

At the meeting, the Saudis and Russians signed several memoranda of understanding including the development of nuclear power plants in the Kingdom, with the Saudis planning some 16+ plants.

The two sides also plan on setting up working groups to study other possible energy joint ventures in Russia. Russia also agreed to the construction of railways and metro subways for the Saudis. Russia is also believed to have agreed to supply advanced military defense equipment to the Kingdom, despite the Saudis being long time arms customers of both the UK and U.S.

However there is quite a bit of doubt that the U.S. is ready to just step aside and be replaced by Russia as the Saudis’ main ally. Saudi Arabia and Russia are on opposite sides on a range of geopolitical issues, including Iran, Syria, and Yemen. These conflicts will likely put a limit on any potential entente.

Also, there is serious doubt as to whether it is so simple for the Saudis to raise oil prices. Flooding the markets with oil to crash prices only requires the Saudis to over-produce by some one and a half million barrels of oil per day, easily within their grasp, and something the Saudis can do on their own.

Bringing prices up is a different story, requiring global oil producers to comply in oil cutbacks.

At the same time, rising prices are a clear signal to global producers to increase production, worsening the current glut, so that any price increase may prove to be temporary.

And yet, the fact is prices have been rising since the first of the year, and many are convinced there is more to go. C. DeHaemmer, a well-known energy newsletter writer, is now predicting a price rise by WTI to a range of $73-$78, and a Brent range of $82-85, by years end. Not impossible, but long term, the issue becomes cloudier.

On a different matter, there was another surprise announcement at the forum, with India, a longtime U.S. ally, confirming that it will sign a free trade agreement with the Eurasian Economic Union (EEU), a Russian-led trade bloc including Belarus and Kazakhstan.

Russia and China have agreed on making the EEU a central part of the Chinese sponsored Silk Road, so by default, it would appear that India is moving towards joining the grand Chinese project.

As has become standard at the St. Petersburg Forum, a number of energy deals were signed, including a BP deal to buy a major stake in a Siberian oil field owned by Rosneft, a company suffering under international sanctions. BP, as a twenty percent stakeholder in Rosneft, says it is seeking to expand on its joint ventures with the Russian company

Another deal was signed with Gazprom to build a second pipeline under the Baltic, following the path of Nordstream to Germany, in partnership with Royal Dutch Shell, Germany’s E.ON, and Austria’s OMV. Apparently, Western Europe’s oil giants find Russian sanctions to be no hindrance in dealing with Russian energy companies.

After his onstage TV interview with Putin, Charlie Rose, the well-known TV celebrity, was asked why he had decided to become a moderator at the Forum. He said, “I believe it’s important to talk to people.”

In the meantime, the U.S. reporter, with camera man in tow, found nothing of interest to report at the conference.

Source: http://oilprice.com/Energy/Crude-Oil/Is-Saudi-Arabia-Leaving-The-US-Behind-For-Russia.html

By Robert Berke for Oilprice.com

03/2/15

America—You be the Judge

By: Retired Adm. James A. Lyons
Accuracy in Media

President Obama’s adamant refusal to link the barbaric atrocities committed by the Islamic State and affiliated al-Qaeda militias to Islam is an insult to the intelligence of all thinking Americans. His insistence that these atrocities are the result of “violent extremism,” not associated with Islam, lessens his already diminished credibility. The Quran and Islamic Law (Shariah) prove him wrong since there are 109 verses in the Quran that can be considered to sanction violence. Furthermore, chapter 2, verse 106 (on abrogation) makes it clear that the later violent verses take precedence over the earlier, less violent ones.

In February, President Obama hosted a White House Summit on countering “violent extremism.” As it turned out, it was essentially a public relations media event that had nothing substantive to offer in terms of countering the Islamic State’s barbaric acts of terrorism. Instead, it was more of a leftist, progressive agenda sympathetic to “Islamic sensibilities and grievances.” It cited lack of education and job opportunities as part of the root cause that enables IS to attract young Muslims. Mind boggling, particularly when Christians, women, and children are having their heads chopped off and are being buried alive.

If it were to have been a serious summit, you would have expected the Director of the FBI and the Chairman of the Joint Chiefs of Staff to be full participants. However, they were not invited. Instead, the Muslim Brotherhood (MB) and its front organizations were full participants, including the Council on American Islamic Relations (CAIR) and the Islamic Society of North America (ISNA), both unindicted co-conspirators for funding terrorism from the 2008 Dallas, Texas Holy Land Foundation Trial. Another MB front organization, the Muslim Public Affairs Council (MPAC), was also represented.

The question must be asked: how can the Obama administration continue to embrace the Muslim Brotherhood when its declared creed, verified by the FBI, is to destroy the United States from within by our own “miserable hands,” and replace our Constitution with Islamic “Seventh Century” Shariah Law?

The MB today, with its deep penetration of all our national security and intelligence agencies, has now been institutionalized. With its carte blanche entry into the White House, it has, in effect, become a defacto cabinet member. All Americans should understand that there is no difference between the Islamic State, al-Qaeda, and the Muslim Brotherhood. Their objectives are all the same, it’s only the methods they use to achieve it that may be different. It is a totalitarian ideology bent on world domination (same as Communism), with Islam the dominant religion and Shariah the law.

The policies of the Obama administration in countering the Islamic jihadists of IS are clearly confusing to our allies. To understand President Obama’s strategy, everything this administration does must be viewed through the prism of his stated objective: to “fundamentally transform America.” This strategy is clear. It is anti-US and anti-Western—but pro-Islam, pro-Iran and pro-Muslim Brotherhood. With his Marxist background, it can be assumed that Obama does not view American power and influence as a force for good in the world. Otherwise, why would he want to fundamentally transform America? Therefore, anything that undercuts US military power and influence is viewed as being “objectively progressive.” President Obama’s refusal to provide legitimate defensive weapons to Ukraine falls under this category. The net result is the emasculation of NATO.

The “leading from behind” strategy announced at the start of the Libyan war, and the unilateral disarmament of our military forces, also fall under this category. A defining moment in the Libyan war was when the Obama administration switched sides in the global war on terror and provided weapons and material support to al-Qaeda and MB-controlled militias. Furthermore, as we now know, the Libyan war was unnecessary since Muammar Gadhafi was prepared to abdicate.

The Middle East today is a disaster area with failed states in Libya, Iraq, Syria, and now Yemen. What’s astonishing is that we are now a de facto partner with the world’s leading state sponsor of terrorism, Iran. By so doing, we are enhancing the expansion of Iran’s hegemony throughout the Middle East at the expense of our long term allies—Egypt, Jordan, Israel and Saudi Arabia.

The Obama administration’s precipitous withdrawal from Iraq gave Iran a clear signal that we would not contest their influence over Iraq. It was a foolish, or worse, attempt to obtain a nuclear weapons agreement with the evil Ayatollah Khamenei regime. Today, Iran is already a nuclear threshold state that has sufficient enriched uranium to make 8 to 12 nuclear weapons within a few months. Furthermore, a reliable source has informed me that Iran secretly bought four nuclear weapons from the former Soviet Muslim Republic of Kazakhstan in 1992. They were said to have been transferred to Iran and stored in the Lavizan military site near Tehran.

More recently, it was reported by Jerome Corsi of WorldNetDaily, on 26 February, 2015, that Iran is operating another secret advanced, uranium underground enrichment site northeast of Tehran that was previously unknown to the International Atomic Energy Agency.

With thousands of American lives lost due to Iran’s more than 35 years of aggression against the United States, it is inconceivable that any American administration would agree to enter into such a critical agreement, like the one currently being negotiated with such an evil regime.

When you consider all of the above, as well as the Obama administration’s abuse of power and the many scandals including Benghazi, the IRS, Operation Fast and Furious, Obamacare, and the immigration fiasco, any other administration would be brought up on charges of threatening the security of the United States. America, it’s up to you to influence your representatives to hold President Obama accountable.