Saudi Ara­bia: The gam­bler is in charge

King’s son bet­ting on fu­ture shot at as­cen­sion to throne

The Hamilton Spectator - - COMMENT - Gwynne Dyer is an in­de­pen­dent jour­nal­ist whose ar­ti­cles are pub­lished in 45 coun­tries.

By the end of 2015 the BND, the Ger­man for­eign in­tel­li­gence ser­vice, was so con­cerned it warned its lead­ers about Saudi Ara­bia’s new Deputy Crown Prince and de­fence min­is­ter, 30-year-old Muham­mad bin Sal­man.

“The pre­vi­ous cau­tious diplo­matic stance of older lead­ing mem­bers of the Royal Fam­ily,” it wrote, “is be­ing re­placed by an im­pul­sive pol­icy of in­ter­ven­tion.” At that point Prince bin Sal­man had been de­fence min­is­ter for just a year, but he had launched a ma­jor mil­i­tary in­ter­ven­tion in the civil war in Ye­men and com­mit­ted Saudi Ara­bia to open sup­port for the rebels in the Syr­ian civil war. He had also taken the bold de­ci­sion to let oil pro­duc­tion rip and the oil price crash.

No won­der the BND char­ac­ter­ized Prince bin Sal­man as “a po­lit­i­cal gam­bler who is desta­bi­liz­ing the Arab world through proxy wars in Ye­men and Syria.” Not just a gam­bler, but one bet­ting on the wrong horses.

The first bet to fail was his in­ter­ven­tion in the Ye­meni civil war, with an aerial bomb­ing cam­paign that has killed at least 10,000 Ye­me­nis, half of them civil­ians, and cost Saudi Ara­bia tens of bil­lions. Prince Muham­mad bin Sal­man (or MBS, as he is known in diplo­matic cir­cles) sold the war as a short, sharp in­ter­ven­tion to de­feat Houthi rebels in Ye­men and put Saudi Ara­bia’s choice for the pres­i­dency, Abd Rab­buh Mansur Hadi, back in power. The Houthis are still con­trol of the cap­i­tal, Sana’a, and Hadi will not be go­ing home any time soon.

His sec­ond bet to sup­port Syr­ian rebels failed when the Syr­ian army, with Rus­sian and Ira­nian help, re­took eastern Aleppo. Not one of Syria’s big cities is now un­der rebel con­trol, and Saudi Ara­bia will have to live with a vic­to­ri­ous, venge­ful As­sad regime.

His big­gest gam­ble was to re­store the Saudis’ global oil power by driv­ing the new com­pe­ti­tion, Amer­i­can pro­duc­ers who get oil out of shale rock by frack­ing, into bank­ruptcy. The frack­ers dou­bled U.S. oil pro­duc­tion in eight years, but the ex­tra U.S. pro­duc­tion was cre­at­ing a mar­ket glut and de­press­ing prices. MBS made mat­ters worse. He reck­oned the frack­ers were high-cost pro­duc­ers who would go broke if the price of oil stayed low for long enough. So Saudi Ara­bia kept its own oil pro­duc­tion high and per­suaded its part­ners in the Or­ga­ni­za­tion of Pe­tro­leum-Ex­port­ing Coun­tries (the oil car­tel) to do the same.

At sev­eral points in the past two years the oil price fell be­low $30 per bar­rel, com­pared to a peak of $114 in 2014, but the strat­egy didn’t work as MBS had planned. The U.S. frack­ers shut down their less prof­itable op­er­a­tions tem­po­rar­ily and some smaller play­ers went bank­rupt, but the sur­vivors are ready to ramp pro­duc­tion up again as soon as the oil price im­proves. Mean­while, Saudi Ara­bia has been burn­ing through $100 bil­lion a year in cash re­serves.

In Novem­ber MBS ad­mit­ted de­feat. Saudi Ara­bia and it’s the oil car­tel part­ners cut pro­duc­tion 1.2 mil­lion bar­rels per day, and Rus­sia and Kaza­khstan chipped in with an­other half mil­lion. The oil price is up to $55 a bar­rel, Saudi Ara­bia’s cash flow has im­proved, and the po­lit­i­cal stresses at home due to wage and sub­sidy cuts have eased off. Peo­ple are ask­ing: “What’s it all about?” The prob­lem is MBS is in a hurry to for re­sults. His promi­nence so young owes ev­ery­thing to the sup­port of his fa­ther, King Sal­man, who as­cended to the throne two years ago. But the king is 81 and in poor health (suf­fer­ing mild de­men­tia, ac­cord­ing to some), and his son is not his ob­vi­ous suc­ces­sor. Nor­mally the suc­ces­sor to the Saudi throne is not the cur­rent king’s son, but a se­nior prince cho­sen by his peers as best fit­ted to rule. The cur­rent Crown Prince is 57-yearold Prince Muham­mad bin Nayef. Even the ti­tle of Deputy Crown Prince is new, and MBS owes it en­tirely to his fa­ther.

So to have any hope of suc­ceed­ing to the throne when King Sal­man dies, Prince Muham­mad bin Sal­man must prove his worth quickly. That’s why he was open to such high-stakes, long-odds gam­bles: one big suc­cess could do the trick for him. He is prob­a­bly still up for an­other roll of the dice.


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