Ananta Highlights on West Asia

West Asia Digest by Ambassador Talmiz Ahmad

H I G H L I G H T S• Political Developments
• Oil-related Developments
I) Political Developments 


1. Syria

Tehran Summit: The leaders of Russia, Turkey and Iran, the co-sponsors of the Astana peace process, met in Tehran on 7 September for their third summit. The leaders had one specific item on their agenda: the fight to liberate Idlib from extremists from Jabhat Al-Nusra and bring this province, the last bastion of the opposition, under the control of President Bashar Assad. The question of Idlib severely tested the unity of the conclave.

President Recep Tayyip Erdogan of Turkey was reluctant to back an all-out attack on the area that hosts 3 million people, including about 100,000 militants. He feared a bloodbath and refugees, along with extremists, fleeing to his country in their thousands; an onerous burden given that Turkey already has 3 million Syrian refugees.

Differences among the leaders were publicly aired at the concluding press conference, when Erdogan abruptly intervened to insist that the joint statement refer to a “cease-fire” so that extremists would get the chance to surrender. Russia’s Vladimir Putin responded by saying it was doubtful they would “stop shooting or stop using their drones,” referring to the drone attacks on Russian bases at Tartus and Hmeimim. However, to accommodate Erdogan, the joint statement was amended to call on all armed groups to surrender their weapons.

In the run-up to the Tehran summit Russia had worked hard to bring together these diverse players. Besides high-level meetings of Russian officials in Ankara, Moscow hosted the foreign ministers of Saudi Arabia and Syria and engaged with the leader of the moderate Syrian opposition. Russian diplomats also interacted extensively with their American counterparts in Washington, Moscow and Geneva to ensure they are on the same page on Syria.

The general mood in Washington is not to allow Russia to score any military or political successes in Syria. Thus, the US has refused to back an attack on Idlib, emphasizing the humanitarian calamity this would create, despite Al-Qaeda-affiliated extremists being located there in large numbers.

Russia has been particularly concerned that the US would use the excuse of a chemical attack to launch a military assault on Syrian and perhaps Iranian forces in Syria. Hence, Russian officials, including Putin, have been warning for some weeks that extremists could use toxic chemicals to instigate such an American attack.

The Russians have gone even further: They have bolstered their forces in the Mediterranean with 25 warships and two submarines and have carried out large-scale exercises off the Syrian coast. Russia has also publicly criticized the consolidation of the US presence in Syria east of the Euphrates, in territory under Kurdish control, seeing in this an attempt to partition Syria. The US has responded by enhancing its own military presence in the Mediterranean and the Gulf.

Sochi agreement: On 17 September, two developments impacted on Russia’s interests in Syria. One, in a reversal of his earlier dismissive position, President Putin, at a five-hour meeting at Sochi agreed to accommodate Turkish president Erdogan’s insistence that the military attack on Idlib be postponed and he be given more time to arrange a peaceful end to the confrontation between the rebels and government forces.

Two, a few hours after the Sochi agreement, during an Israeli air attack near Latakia, Syrian retaliatory anti-aircraft fire brought down a Russian military plane, killing 15 Russian military personnel on board. Despite Israeli protestations, Russia asserted that an Israeli plane had deliberately ‘pushed’ the Russian aircraft into the line of fire.

These two developments have further complicated the already convoluted Syrian scenario.

The Sochi agreement was a major concession by Putin. While anxious to avoid a blood-bath in that city with three million people, many of them refugees from other cities, he sees Idlib over-run by 50,000-90,000 militants and is sceptical about a peaceful outcome.

However, he recognised the high stakes for Erdogan: Turkey supports a “moderate” opposition group, the National Liberation Front (NLF), made up of Arab and Turkoman fighters, as a counter-weight to the Syrian Kurds, and wishes to ensure they are not annihilated in a full-scale government assault on Idlib.

Putin backed Erdogan’s interests at Sochi to retain Turkey, a NATO- member but estranged from the US, as a regional ally and as a partner, with Iran, in the Russia-led Astana peace process in Syria. Thus, following Sochi, Erdogan has agreed to set up a 15-20 km buffer zone at Idlib by 15 October that will separate government and rebel forces and will be jointly patrolled by Russian and Turkish military units. By 10 October, all militants in Idlib will have to surrender their heavy weapons, including tanks, mortars and heavy artillery.

Turkey will then have the responsibility of separating the ‘moderate’ opposition from extremist elements, including Jabhat Nusra. Militants will have the option of joining the ‘moderate’ opposition, the NLF, or leave Idlib. Those who retain their weapons and remain in the city could be subjected to targeted attacks. This process should end by 10 December. Putin has said that by end-December, the Aleppo-Latakia and Aleppo-Hama highways, passing through Idlib, will become functional.

For Turkey, separating moderates from extremists will be difficult. While some extremists could merge with mainstream opposition groups as a tactical ploy, hardcore radicals may not surrender: jihadi ideologue Abu Mohammed al Maqdisi has declared Erdogan an ‘apostate’, while Jabhat Nusra fighters have refused to give up their weapons. It is also feared that some extremists could sneak into Turkey and carry out terrorist operations.

An important area of uncertainty is the fate of some 3000 foreign fighters at Idlib, mainly from Uzbekistan, Chechnya and Uyghurs from China. While some had earlier joined the Islamic State, most of them have remained with Jabhat Nusra. They form a lethal component of the Hayat Tahrir al Sham alliance of hardline groups mainly located in the town of Jisr al-Shughour, southwest of Idlib. They are expected to fight hard against the government assault.

Most regional commentators believe that the Turkish peace initiative will fail and military operations, backed by Russian air support, could even begin from mid-October.

Downing of the Russian aircraft: The bringing down of the Russian aircraft had initially revealed a rare public divide between Putin and his defence establishment: Russian defence minister Sergei Shoigu said that Israel bore “full responsibility” for the attack, while Putin attempted to defuse the situation by saying it was caused by a “chain of tragic chance events”. Russian military however firmly rejected a presentation by the Israeli air chief in Moscow blaming Syria for the loss and saying its aircraft had returned home when the Russian aircraft was hit.

Russia and Israel have worked closely in Syria over the last three years, with Russia quietly accepting at least 200 Israeli air attacks in the last 18 months. This cordial relationship is part of Russia’s interest to be close to all players in West Asia to enhance its influence by filling the vacuum left by an inert and directionless US and promote stability in the conflict-ridden region. Israel has benefitted from the relationship since Russia alone seems capable of restraining Iranian military activity in Syria.

By facilitating the attack on the Russian aircraft, Israel had perhaps wished to convey to Moscow that it retained the right to safeguard its security interests despite its ties with Russia. Now, though, Israel seems anxious to mend ties with Russia: its earlier aggressive public posturing has become more muted.

A week after the attack, Russia revealed its iron hand. On 24 September, its defence spokesperson accused Israel of “criminal negligence” and “ungratefulness”. He recalled the various ways in which Russia had been accommodating Israel’s interests in Syria, most recently by ensuring that Iranian forces were kept at 140-km from the Israeli border at the Golan heights during operations in southeast Syria.

He then announced that Syrian capabilities would be enhanced to deter future attacks with the S-300 missile systems that have been on the Syrian wishlist for five years. Again, Syrian defence units would now be able to electronically jam onboard radar communications and satellite navigation systems.

While this will restrict Israeli attacks in Syria, it is likely that Russia and Israel will soon be drawn together by their shared interests. There are even suggestions that the new military facilities in Syria will remain under Russian control.

2. Iran

Trump and Rouhani at the UNGA: At the UN General Assembly, on 25 September, US President Donald Trump excoriated the Islamic Republic as “brutal,” “corrupt” and “dictatorial”. While not mentioning any Iranian leaders by name, he described them as “brutal” and “corrupt” and said they “sow chaos, death and disruption” in the region and have “embezzled billions of dollars” belonging to the Iranian people. Trump said: “We cannot allow the world’s leading sponsor of terrorism to possess the planet’s most dangerous weapons.”

Speaking at the General Assembly just a few hours after Trump, Rouhani took a swipe at what he called “photo-op diplomacy”—an apparent reference to Trump’s summitry with North Korea, which has yet to yield denuclearization—and invited the US to return to UN Security Council resolution 2231, which codified the JCPOA: “We invite you to come back to the negotiating table you left,” he said.

Rouhani added, “We appreciate the efforts of the international community, the European Union, Russia, and China in supporting the implementation of the JCPOA and consider the full realization of the commitments stipulated in it a precondition for the survival of this significant accomplishment of diplomacy.” He was referring to the P4+1—Britain, France, China, Russia and Germany—who, along with the European Union, have affirmed their support for the 2015 nuclear accord with Iran and promised a special payment mechanism to allow foreign companies to circumvent sanctions reinstated by the Trump administration.

Rouhani, in meetings with American think tankers and journalists, also put a positive spin on US withdrawal from the Joint Comprehensive Plan of Action (JCPOA), calling the US the loser and asserting Iran’s ability to survive what it regards as unjust punishment. In an interview with NBC News, Rouhani accused the US of “trampling upon” the UN resolution in hopes that its withdrawal from the JCPOA would convince Iran to also exit the agreement so “the case would be referred to the UN Security Council and Iran could be brought under sanctions again.” Even if US sanctions bite hard, Iran can say it holds the high ground and try to wait out the Trump presidency.

The Ahvaz attack: On 22 September, less than a month after Iran’s consulate in Basra was attacked, a group of terrorists claiming to be members of the Movement for the Liberation of Ahwaz attacked a military parade in the capital of Iran’s Khuzestan province, killing 29 people and wounding many more.

The Ahwaz attacks also occurred shortly after operations by Kurdish insurgents belonging to the Iranian Kurdish Democratic Party in Iran’s mostly Kurdish inhabited regions in the country’s northwest. These attacks prompted the revolutionary guards to target the bases inside Iraqi Kurdistan from which they were operating.

These back-to-back attacks raise the question of whether the United States and its regional Arab allies, particularly Saudi Arabia, have adopted a strategy of besieging Iran in many of its vulnerable provinces, possibly as a prelude to more direct and large-scale military operations against Tehran.

Commentator Shireen Hunter has pointed out that “some of the problems that Iran faces in several of its western and southern provinces are caused not by a widespread desire for independence but by decades of neglect and mounting economic problems and thus growing popular frustration”. For instance, the central government has long neglected the Kurdistan province. Its economic conditions as well as its communications, roads, railroads, and other infrastructure lag behind the rest of the country. Various governments in the last 30 years have promised a fairer treatment of the so-called deprived regions, which includes Kurdistan, but have failed to deliver.

Khuzestan includes areas inhabited by ethnic Arabs who had resisted Saddam Hussein’s armies and remained loyal to the country. The province also suffered the most devastation as a result of the Iran-Iraq war. However, after the war ended, the reconstruction in Khuzestan proceeded very slowly. Many projects, including badly needed water projects, which should have been long finished are still incomplete.

One day after the attack, the Islamic State (IS) released a video claiming responsibility for the attack that killed 29 people, including children and disabled veterans of the Iran-Iraq War. The IS-affiliated Amaq news agency released a video of the four perpetrators. Three of the attackers spoke Arabic into the camera as they drove in a car, dressed in military fatigues. One of the attackers spoke Persian.

IS is not the only group to take responsibility for the attack. European-based Arab separatist groups also attempted to claim responsibility, causing the wrath of Iran against their European host countries. Yaqub Horr Tostari, who claimed to be a spokesman for the separatist Al-Ahvaz movement, called into a Saudi-funded London-based Persian-language station, Iran International, to take responsibility. Tostari said that a group called “the National Resistance of Ahvaz” carried out a “legitimate attack.” Tostari denied that his Al-Ahvaz movement was behind it but rather described the National Resistance of Ahvaz as an umbrella group. The Islamic Republic News Agency reported that the “Patriotic Arab Democratic Movement in Ahvaz”, a separatist group, had also taken responsibility.

While the separatist groups justified and praised the attack, they also began to deny responsibility for it. The denials by the European-based separatist groups came after Iran summoned the envoys of Denmark and the Netherlands to the Iranian Foreign Ministry for hosting them. Some members of separatist groups in Austria and Denmark praised the attack on Twitter. Iran also summoned the United Kingdom charge d’affaires for allowing London-based media outlets to provide platforms for those who claimed to be behind the attack.

Iran’s Foreign Ministry spokesman Bahram Ghassemi criticized European double standards with regard to terrorism, saying, “It is not acceptable that so long as these terrorist groups have not committed a crime on European soil [they] are not added to the blacklist of terrorist groups.” Ghassemi noted that Denmark and the Netherlands were previously warned about the Arab separatists who either claimed or promoted the attack, and that Iran expects them to be arrested and tried.

3. Iraq

Government formation: On September 15, the Iraqi Council of Representatives cast secret ballots to elect a new speaker of parliament and two deputy speakers. Sunni politician and former governor of Anbar province Mohammed al-Halbousi secured 169 out of 298 votes, defeating his better-known rival, former defence minister Khalid al-Obeidi.

The parliamentary leadership vote came after yet another abrupt shift in political alliances, bringing two unlikely partners together after an election that left no one with a commanding victory. Muqtada al-Sadr’s Sairoon coalition (54 seats) and Hadi al-Ameri’s Fatah Alliance (47 seats) were first and second in the May polls and had been vying against each other to form the largest parliamentary bloc, actively wooing Prime Minister Haider al-Abadi’s Nasr list (42 seats), the two main Kurdish parties (44 seats total), and various Sunni groups.

While back-room bargaining was on, there were mass protests and violence in Basra, with protests against inadequate public services and rampant corruption. This provoked a rare intervention by top Shia cleric Grand Ayatollah Ali al-Sistani, whose backing for the popular protests and apparent criticism of the Abadi administration, ended Abadi’s chances of securing another term as prime minister.

This propelled Sadr and Ameri to join forces rather than compete. Sairoon, Fatah, the Sunni-led National Axis coalition, the Kurdistan Democratic Party (KDP), and the Patriotic Union of Kurdistan (PUK) agreed on Halbousi as speaker, Sairoon nominee Hassan Karim al-Kaabi as first deputy, and KDP nominee Bashir al-Haddad as second deputy (traditionally a Kurdish position).

This alliance sidelined Sairoon and Fatah’s common rival, the Islamic Dawa Party, led by former prime minister, Nouri al Maliki. It also scored a perceived victory for Tehran, which lobbied for Halbousi and holds major influence over the many Shia militia figures and other proxies within Fatah’s ranks.

Iraqi political tradition provides for a Sunni speaker, a Kurdish president, and a Shia prime minister. The presidential election will be complicated because the Kurds are deeply divided. Iraq’s two former Kurdish presidents came from the PUK, which wants to keep the position. Yet the rival KDP is claiming the presidency for a yet-to-be-named nominee of its own, arguing that it won more seats (26 to the PUK’s 18) and deserves a fair chance because the PUK has held the position since 2006.

The PUK candidate, Barham Salih, is a formidable figure who has long cultivated relationships in Baghdad and formerly served as deputy prime minister. To win, the KDP will not only have to field a strong candidate, but also expend significant political capital with Sunni and Shia parties.

Prime Ministerial candidate: At the end of September, reports appeared that the principal Shia parties had agreed on a prime ministerial candidate – he is Adel Abdul Mahdi, a former head of the Ministry of Oil and Ministry of Finance and a one-time vice president of the country. Following negotiations said to have involved Hezbollah, Mahdi now appears to have the support of two rival parliamentary coalitions: the Sairoon Alliance of Shiite cleric Muqtada al-Sadr and the Fatah Alliance of Hadi al-Amiri.

Lebanese commentator Makram Najmuddine has reported that the Sairoon-Fatah compromise may have begun, at least in part, in Lebanon, which is Sadr’s favoured travel destination and where his family hails from. The Iraqi cleric is said to have attended an important meeting there in early September when he met Hezbollah chief Hassan Nasrallah and Maj. Gen. Qasem Soleimani, the commander of Iran’s special forces unit, Quds Force. The three ultimately agreed on Mahdi as a candidate for prime minister, with the main objective of “preventing the United States from ruling Iraq once again.”

4. Saudi Arabia

Vision-2030 in difficulty: The future of Saudi Arabia’s plan to reduce its dependency on oil income is in question after the King scrapped the kingdom’s plans to take the national oil company public. Commentator Bruce Reidel asserts that Saudi Vision 2030, the brainchild of Crown Prince Mohammed bin Salman to reduce the kingdom’s dependence on oil income, “is coming undone”. In support, he says: “The king has stripped away the central pillar of the project. The country is becoming more autocratic and repressive. The slide toward greater repression is prompting capital flight.”

The centrepiece of the ambitious plan was to open up Aramco, the national oil company, to outside investors. Five percent of the company was to be opened initially, creating an initial public offering, or IPO. The crown prince estimated that the company would be valued at $2 trillion, creating the world’s largest IPO of $100 billion.

From the beginning the plan faced serious problems. Many analysts had felt that the company was considerably overvalued. There were also difficulties in finding a stock exchange market. President Donald Trump pressed the Saudis to select New York, but there was a chance that a New York listing would place the IPO at risk of being seized in the trial underway by claimants asserting that Saudi Arabia was a party to the 9/ 11 attacks. London was compromised by the Brexit campaign, which is raising questions about the future of the British banking sector.

The crown prince’s so-called anti-corruption campaign last November — in which hundreds of prominent Saudis, including members of the family, were detained and forced to hand over assets to the government — added further difficulties. The shakedown underscored the absence of due process and the rule of law in the kingdom and discouraged foreign investment. It also sparked major capital flight as the wealthy sought to protect their assets abroad. One authoritative estimate is that almost $150 billion in capital has left the kingdom in the last two years.

The king decided to scrap his son’s plan in June, according to well-sourced reports from Riyadh. King Salman heard from numerous elements in the royal family who were opposed to the plan and decided to shelve it and dissolve the planning process for creating an IPO.

With the economic component of Vision 2030 gone, the social reform process became more important. Letting women drive has been the signature accomplishment for the social reform plan, but it has been badly discredited by the government’s arrests of numerous female advocates of gender reform. The arrests demonstrate the regime’s acute sensitivity to any kind of dissent at home or criticism from abroad.

………………………………………………………………………………………………II) Oil-related Developments
Oil rose to its highest price in four years on 30 September, to $82.72 on Brent, and $ 73.25 on WTI, after Saudi Arabia and Russia downplayed calls from the US to increase production.

Earlier, President Donald Trump had attacked OPEC, saying the 15-member oil organisation should keep crude prices low because of the military protection the US provided for the region. “We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices! We will remember. The OPEC monopoly must get prices down now!” Trump wrote on Twitter.

The Saudi position is to make clear that it can boost supplies in response to market demand but will not enhance production and bring down prices only to appease the US president. Saudi Arabia has said it can pump 1.5 million b/d above its current output of some 10.4 million b/d – which could be made available when US sanctions set to cripple Iranian supplies start in early November.

Saudi Arabia will boost its crude oil production in the coming months as it expects stronger demand, its minister Khalid al Falih clarified at a monitoring committee meeting of OPEC and non-OPEC members in Algiers on 23 September. He insisted that the kingdom stood ready to meet any customer requests for crude.

Saudi Aramco can produce 12 million b/d at will, he said, and once negotiations with Kuwait are complete, fields in the Neutral Zone shared by the two countries could add another 500,000 b/d.  “Our plan is to respond to demand. If demand [for Saudi crude] is 10.9 million b/d you can certainly take it to the bank that we will meet it. But the demand is 10.5 million b/d or 10.6 million b/d. I think October will be more than this,” Al-Falih said.

But many market watchers are sceptical that Saudi Arabia has the claimed spare capacity, raising doubts on whether OPEC’s largest producer can prevent a price increase from a supply shortage following imposition of sanctions on Iranian oil. So far, the country has never produced above 10.7 million b/d. The US Energy information Administration estimates that all 15 of OPEC’s members hold a combined spare production capacity of 1.42 million b/d. Other assessments are more generous: the International Energy Agency estimates Saudi spare capacity at 1.62 million b/d and total production capacity at 12.04 million b/d. Other OPEC members are also expected to contribute. The UAE claims some 500,000 b/d of spare capacity, while Kuwait has about 100,000 b/d.

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