A kingdom in decline

August 12, 2002|By Borut Grgic

ONCE A prosperous kingdom, an international, and a regional power, today's Saudi Arabia looks a little ragged.

With mounting internal and external pressures, the ruling elite's hold on power has been spread thin.

Not only has Saudi per capita income plummeted from a staggering $28,600 in 1981 to $6,800 last year, but its worth as a regional power and a reliable ally is being increasingly questioned, even challenged.

Following Sept. 11, the Bush administration has been pressed to begin drafting alternatives to Saudi oil. After all, 15 of the 19 hijackers were Saudi and only 16 percent of Saudis have a favorable view of America.

Not surprisingly, Americans have been working hard at stabilizing their relationship with Russia, which they hope will, in the near future, supply some of the energy currently imported from Saudi Arabia. The Russian oil sector is a lot like the United Kingdom's (the Russian government has limited power over how Russian oil companies allocate their sales or investments) - something Americans understand and can work with. On the contrary, the nationalized oil industry of Saudi Arabia is hardly convincing to the proponents of laissez faire.

Cause for less alarm was the recent visit by Walter Kansteiner, assistant secretary of state for African affairs, to Nigeria and Angola: the two largest oil producers in sub-Saharan Africa. Nevertheless, according to Mr. Kansteiner, pursuing the African alternative is "undeniably" in the United States' national strategic interest.

Russia and sub-Saharan Africa are far less hostile to U.S. presence than is Saudi Arabia. According to a recent nationwide survey, 65 percent of Russians feel "good" or "very good" about the United States. The Institute for Advanced Strategic and Political Studies has found West Africa to be "receptive to American presence."

But America is not only distancing itself from the Saudi oil, it is also challenging the Saudis over political alignment in the region. Thus far, Crown Prince Abdullah has been less than successful in his attempts to alter the Bush stance on the Middle East conflict. His peace proposal, albeit an effort appreciated by policymakers in Washington, did little to change the U.S. president's staunch support for Israel's right to self-defense. What's worse, the Abdullah plan was poorly received even in some of the other Arab states.

On the question of Iraq, the Saudis have been still less influential. Despite their affirmation at the last Arab League summit that an attack on Iraq would constitute an attack on all Arab countries, they have struggled not only with keeping Americans from attacking, but at keeping other Arab states from participating in the American lead preparations.

Leaked reports from the Pentagon now reveal that including the Saudis in a coalition to dislodge Saddam Hussein would be preferred, but their participation is not essential. The U.S. military already has begun shifting resources from the Prince Sultan Air Base in Saudi to the Al Udeid Air Base in Qatar. Gen. John Jumper, Air Force chief of staff, says the military is upgrading Al Udeid for use as a command-and-control center if the Saudis declare the Combined Air Operation Center in Saudi Arabia off-limits.

And yet there is little the Saudis can do to reverse America's growing independence and Saudi Arabia's increasing irrelevance in the Middle East. At this point, an oil embargo (a tactic Saudi Arabia used in 1973 to put pressure on the United States) is no longer possible.

For one, Saudi Arabia today accounts for only 15 percent of the United States' crude oil imports, half the amount America imports from Canada, Mexico and Venezuela.

Second, with promising new oil sources opening up in Russia, Central Asia and sub-Saharan Africa, the United States today has alternatives it didn't have in 1973.

And third, an oil embargo at this point would do more damage to Saudi Arabia than it would to the U.S. economy. After all, it is Saudi Arabia that is growing younger, poorer and more radical. A drastic drop in income could further strain the already delicate domestic balance between the West-leaning House of Saud and the conservative, anti-Western clerics. A collapse of this balance would certainly unleash dangerous chaos in the kingdom.

However, pressure from the Americans is not all the House of Saud is forced to deal with. Even in settings where Saudi Arabia has traditionally been the decision-maker, such as OPEC and the Gulf Cooperative Council, the Saudi pull has considerably declined.

Its ability to influence and set global oil policy through OPEC (as it did in 1985-1986 to dislodge the Soviets, and again in 1996-1997 to do away with the Venezuelan challenge) has largely been compromised by its deteriorating social and economic conditions. The truth is, Saudi Arabia today is in no position to wage a price war, especially not against Russia, its most serious competitor on the global energy market.

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