When the Saudi King Salman promoted his son Mohammad bin Salman (MbS) to Defense Minister and then Crown Prince the expectations were high. But three of the major projects Muhammad launched since then soon ran into trouble. Now initiatives are under way to limit the damage he caused. The end of the five year old Saudi war on Yemen is coming into sight. The public offering of the Saudi state owned ARAMCO oil company is finally happening but with a much lower valuation than originally planned. The thirty month spat with Qatar is under repair. On August 17 2019 a Yemeni drone attack on Saudi Arabia's oil installations proved that the Saudis had lost the war. Moon of Alabama's headline empasized the effect that it would have: Long Range Attack On Saudi Oil Field Ends War On YemenA month later another large scale attack disabled half of the Saudi oil output. The Saudis have since procured additional U.S. military units to provide more air defenses around their oil installations. But U.S. air defenses are not effective against the kind of attacks the Yemenis launched. The Saudis had no choice but to sue for peace. For several months there have been talks in Oman between Saudi official and Houthi delegations. An preliminary agreement was found but no official announcements were made. That changed today when Saudi Arabia’s Minister of State for Foreign Affairs Adel al-Jubeir made a comment that for the first time recognized the Houthi as a legitimate Yemeni entity: Speaking on the situation in Yemen, al-Jubeir said that there is a possibility of reaching a truce in the country, which could be followed by a settlement.Today the Saudis also released some 200 prisoners who belonged to the Houthi. They were flown to Yemen's capital Sanaa. The preliminary agreement foresees the forming of a common government by the Houthi and the Saudi controlled former president Hadi. This is not yet the end of the war. It will take quite some time before a new Yemeni government will evolve as the Saudis still have some unrealistic demands: Saudi Arabia seems more open to some kind of coexistence with the Houthis in north Yemen through taking control over them from Iran. After signing the Riyadh power-sharing agreement between the separatist Southern Transitional Council and the UN-recognised government in Aden, Saudi Arabia and the UAE seem to be ready to move on to the next phase of their gouty war in Yemen.Iran has never had "control" over the Houthi. Even the U.S. State Department has recently changed course and finally admitted that: In a shift that analysts said reflects progress in Saudi talks with Yemen’s Houthi rebels to end the Yemen war, State Department Iran envoy Brian Hook said today that Iran does not speak for the Houthis, whom he described as playing a more constructive role in issuing a cease-fire proposal.The Houthi are not under Iranian control and neither is Hizbullah in Lebanon. These groups are independent political entities which make their own decisions in their own interests. Iran helps those groups during times of need as they will help Iran when necessary. Hook's claim that Iran is trying to prolong Yemen’s war is without any basis. Iran has enabled the Houthi to resist throughout the 5 years of war the Saudis waged on them. Drones and missiles parts provided by Iran to the Houthi allowed them to compel the Saudis to sue for peace. It is therefore highly unlikely that the Houthi will dissociate themselves from Iran. They will agree to end their attacks on Saudi Arabia if the Saudis end their attacks on Yemen and pay for the damage their war has caused. If the Saudis do not agree to that more of their helicopters will come down in flames and more of their oil installations will be set on fire. The war on Yemen was started by clown prince Muhammad bin Salman who was then Defense Minister of Saudi Arabia. He had hoped for a fast victory but the well equipped Saudi military proved to be incapable of defeating barefoot Houthi in the mountains of north Yemen. The war costs the Saudis several billions per month and threatens to ruin the state. Muhammad Bin Salman's other projects did not go any better. He had planned to sell shares of Saudi Aramco at international stock exchanges and at a total valuation of 2 trillion dollar. The move was supposed to bring in $100 billion to finance a further industrialization of the Saudi economy. After many delays Saudi Aramco is now finally making its initial public offering. The shares will start trading on December 11. But the stock will only be listed at the Saudi Tadawul exchange. The initial share price offer puts the value of the company at $1.7 trillion which is higher than the $1.5 trillion estimate international banks had published. Today the Saudis announced a large cut in their oil output to increase the global oil prices and the company's valuation. That might attract more urgently needed buyers to the IPO. But the stocks will still be sold to mainly domestic entities, if needed with some pressure. Instead of attracting $100 billion of fresh money from abroad some $25.6 billion will be taken out of the left Saudi trouser pocket to be put into the right one. The economic benefit for the country is dubious. Two and a half years ago the clown prince tried to attack and occupy Qatar. The given ideological reason was the Qatari support for the Muslim Brotherhood. But the real reason was the Saudi need for more money which MbS tried to gain through a real estate and resource grab. The project failed when Turkish troops came to Qatar's aid. The Saudis and its UAE allies then tried to isolate Qatar with an embargo. That failed too but caused the Saudi rulers additional headaches which is why they are now pushing to end the conflict: [N]ow more than two years on, signs of economic and political fracture are beginning to show not in Qatar, but in its embargoing neighbors. It is these indications that may help explain the countries’ recent conciliatory gestures, including the resolution to join the Arabian Gulf Cup in Doha and contemporaneous remarks by Saudi and Emirati officials suggesting a newfound openness to ending the dispute.The Saudi rulers fears that their own population will point to Qatar and demand an increase in welfare or lower taxes. If all GCC countries, including Qatar, agree to take the same steps that the Saudis had to take, the chance of a revolt would decrease. Qatar's foreign minister has recently made a 'secret' visit to Riyadh and the Saudi King has invited the Emir of Qatar to the next GCC meeting. But Qatar has a budget surplus while the Saudis have a 10% deficit. Qatar has no need to follow the economic policies of the other GCC countries. It will only do so if the Saudis are willing to offer something for it. Three of the clown prince's major projects have failed. On top of that comes the reputational damage that the murder, on MbS' order, of Jamal Khashoggi caused. That the Saudi king has now taken steps to limit the overall damage may have come through the influence of Muhammad bin Salman's younger brother, Khalid bin Salman. KbS had been the Saudi ambassador to the U.S. Since February 2019 he has been the Deputy Defense Minister of Saudi Arabia. He was involved in the talks with the Houthi. It is possible that the king will finally recognize that MbS is not good enough for the job and that Khalid may a better successor to the throne than his brother Mohammad. Source URL |