The Saudi government continues to try to regain its footing after shifting relations with the United States brought on by the Sept. 11 attacks and, more concretely, the war in Iraq. The government faces internal pressures from al Qaeda-related militants and also from broader sectors of Saudi society, while external pressures from the United States continue. Several incidents this week exemplify this ongoing balancing act by Riyadh: the awarding of natural gas exploration contracts to four non-U.S. firms, the withdrawal of diplomatic recognition by the United States for 16 Saudis attached to the Saudi Embassy in Washington and the deadly shoot-out with militants in Riyadh on Jan. 29.
As Stratfor has pointed out on several occasions, one of the key goals of the U.S. war in Iraq was to put increased pressure on -- and effect change in -- Saudi Arabia, an erstwhile ally that is also the focal point of al Qaeda. That pressure was felt and started to yield results even before Washington sent troops into Iraq, but the level and pace of cooperation from Saudi Arabia did not, and does not, match Washington's desires. This is less a factor of pure intransigence on the part of Riyadh than it is the reality that the Saudi regime faces at home -- a population that in many respects is much more sympathetic to al Qaeda and its ability to make at least a show of projecting Islamic power -- than to the ruling regime.
For the Saudi leadership, directly challenging the potential al Qaeda threat is as dangerous as NOT acceding to U.S. pressures -- and perhaps even more so. The Saudi government long dealt with challenges to its rule from more ideological Islamist elements by redirecting and "exporting" Wahhabi militancy. This not only expanded Saudi Arabia's reach abroad -- giving it an additional tool beyond oil for influencing foreign nations -- it also kept the pressure off of the regime itself, which was seen more and more as growing corrupt and moving away from the true faith. The latter impression represented a significant challenge to the House of Saud, which to a large degree draws its legitimacy from remaining the custodian of the holy cities of Mecca and Medina.
When Riyadh brought the U.S. military into the country at the time of the first Iraq war in 1991 to stave off a fate similar to Kuwait's, the overwhelming perception of an imminent threat drew broad understanding from the populace. But the public mood changed after the war, when the extent of the death and destruction in Iraq became apparent and the blame was passed through the U.S. forces to the House of Saud, which invited them in to begin with. The retention of the U.S. bases in the country added fuel to the fire of those opposing the regime who used the U.S. presence as a rallying point and an example of the disloyalty and deviance of the Saudi regime, which opponents said sullied the sacred soils of Saudi Arabia with U.S. military personnel.
From its start, al Qaeda eyed regime change in Saudi Arabia as a way to rectify the perceived lack of strong Wahhabi leadership. A key step toward achieving this goal was the removal of U.S. forces from the country. As long as the U.S. military had a strong presence in Saudi Arabia -- something not only justified by the continuing threat from Iraq, but also encouraged by Riyadh for its own security -- al Qaeda had little chance of staging a popular uprising in the face of the combined power of the Saudi leadership and the U.S. military.
For Riyadh, then, the presence of U.S. forces was both a saving grace, staving off internal and external aggression, and a source of danger, contributing to domestic opposition to the regime and to the rise of domestic militancy. The resulting internal threat to the regime was stifled and deflected, with Osama bin Laden -- the personification of the opposition -- leaving the country and targeting U.S. military facilities and operations abroad.
After Sept. 11, however, the Saudi government's combination of repression, redirection and overlooking al Qaeda and its supporters at home was no longer acceptable to the United States. Washington made it clear that there were only two categories of nations: those in support of the United States and those in support of the terrorists. Straddling the line was not a choice. While countries like Iraq, Iran and North Korea took on the label of the Axis of Evil, the subtler but more important pressures were directed at the also-rans: Saudi Arabia, Syria and Pakistan, with another eye abroad on Indonesia. But chief among these was Saudi Arabia, at the very heart of Islam, the Middle East and al Qaeda.
For Washington, complete cooperation from Riyadh is necessary not only to deny material and moral support to al Qaeda, but also to shape the actions and decisions of other Islamic states in the region. In Riyadh, it was clear that, while the U.S. government did not necessarily want the regime to collapse, it had little patience for such excuses as the Saudi government slowly addressing the al Qaeda threat. The withdrawal of U.S. forces from Saudi Arabia, an easy decision on Washington's part once it had access to Iraq, was used by the Saudi regime as a way to balance the increasing crackdown on al Qaeda and its supporters domestically.
By being seen as ousting the U.S. military, Riyadh hoped to regain the moral authority in the kingdom and minimize the backlash from targeting militants. But the removal of U.S. forces also removed some of the security from the Saudi regime, something officials knew they could not replace. The catch-22 for Riyadh continues as the government tries to assure its own survival while balancing internal and external pressures. If Riyadh is too quick to act internally, it could create a situation where the government itself becomes the physical target of militants. If too slow, it allows the militants to recruit and gain strength for a future move against the government -- or it encourages the United States to take punitive action against the regime and potentially even prepare to take maters into its own hands.
Each move against militants both internal and external, then, is carefully matched with some sign or symbol to the people of Saudi Arabia to try to retain the respect and authority of the populace. Thus the regime must find ways to counteract other domestically unpopular but internationally necessary moves, like the recent decision to end support for Chechen militants.
Riyadh's distribution of natural gas exploration and production contracts during the week of Jan. 26 is part of this counterstrategy. On Jan. 26-28, Riyadh parceled out the rights to explore three new natural gas exploration zones (A, B and C), two of which are in the Rub al-Khali, or Empty Quarter. The goal is to help fuel domestic energy needs and allow the export of an even greater percentage of Saudi oil production. The opening of the natural gas sector, seen by many foreign energy firms as a stepping-stone to openings in the more lucrative oil sector, had been in negotiations with major U.S. energy firms for years. Talks dissolved over differences in access and revenues, and were tainted further by degrading relations between Riyadh and Washington.
When the new exploration concessions were finally announced, U.S. companies were conspicuously absent from the list. Instead, Russia, LUKoil, China's SINOPEC, Italy's ENI and Spain's Repsol won the concessions, with the Chinese and Russian firms each in direct partnerships with Saudi Aramco in their respective zones and the two European companies sharing the third concession with Saudi Aramco.
Riyadh's decision to go with LUKoil and SINOPEC, which have little experience in natural gas operations, appears to defy traditional economic considerations. Even the decision to give one block to ENI and Repsol, which can handle the task easily, seems a less viable option than handing the contracts to larger firms like Royal Dutch-Shell, ChevronTexaco or ExxonMobil. The choice of partners is clearly politically motivated, and the message is clear -- Saudi Arabia is not a tool of the United States and its energy resources are not falling into U.S. hands.
It is the direction of the message -- to the people of Saudi Arabia rather than to Washington -- that is interesting to note. Years-long discussions with U.S. firms were already faltering, and Riyadh expects little blowback from Washington on this. Instead, in order to preserve a sense of internal legitimacy and (they hope) stability, Riyadh is willing to trade economic viability and technical expertise for symbolic partnerships.
Both Russia and China are seen in Saudi Arabia and elsewhere as the key competitors to Washington in the realm of international foreign policy. By offering them access to the gas fields, and excluding U.S. and British firms, Saudi Arabia is signaling -- and even flaunting -- its resistance to U.S. pressure. As a trade-off, Riyadh expects Moscow and Beijing to offer support in the international arena and dissuade any U.S. move or excessive pressure on Saudi Arabia. From the Saudi viewpoint, it does not hurt to have two key friends permanently in the U.N. Security Council should Washington try to retrace its Iraq path in Saudi Arabia.
Russia and China are both quite happy to oblige the kingdom: They will gain access to Saudi Arabia and experience in natural gas operations. LUKoil, for example, is particularly satisfied given its -- thus far -- unsuccessful bid for offshore natural gas operations in Venezuela. LUKoil already plans to pump $200 million into the operation in Saudi Arabia over the next five years, and hopes for a 15 percent return on investment. More important for LUKoil, however, will be the knowledge gained in the operations. SINOPEC also will gain experience and hopes to parlay the gas explorations into future access to the Saudi oil sector. For Beijing and Moscow, there is the opportunity to gain an additional presence in the region.
But as the Saudi government tries to balance its international relations and maintain internal cohesion, Washington continues to remind the regime of U.S. goals in the war against terrorism, and the desired assistance from Riyadh. In a clear message to Riyadh, Washington revoked the diplomatic status of 16 Saudis and asked them to leave the United States. The Saudis reportedly were not working on the embassy grounds, but instead "teaching Islam outside the embassy and therefore not entitled to diplomatic status," a U.S. State Department official told AFP on Jan. 28. In the past, such issues would be quietly ignored or quietly discussed. Instead, Washington publicized the issue, complete with declaring the 16 Saudis persona non grata.
The message from Washington is that the window of acceptable activity by the Saudi government is narrowing, and previously overlooked infractions are now inexcusable. While this was a minor diplomatic incident, it clearly has deeper significance given the current state of relations between the two nations. As Iraq nears a state of nominal stability, Washington will begin to set its sights farther afield to maintain the offensive in the fight against al Qaeda. Already there is talk of a new offensive in Afghanistan, perhaps to pre-empt an expected offensive by the Taliban and keep the militants on the defensive during the upcoming elections. But other locations, from the Horn of Africa to Syria to Saudi Arabia could fall under U.S. sights, and Riyadh will carefully gauge its reaction to the diplomatic dustup to remain just outside the U.S. area of operations.
At the same time, Riyadh continues its internal crackdown on militants and has stepped up operations as the country fills with Islamic pilgrims performing the Hajj. A shoot-out with suspected "major" terrorists in Riyadh on Jan. 29 left at least five Saudi security officials dead after a raid on a suspected militant hideout. The raid comes amid concerns that al Qaeda could stage operations during the Hajj against Western or government targets in the country, or will use the influx of pilgrims to recruit and network.
For Riyadh, then, pressure is only mounting at this time: A failure to act internally is just as potentially dangerous as action. Riyadh has few places to turn for assistance and respite. While Moscow and Beijing certainly will take advantage of the Saudis' tough luck, there is little chance at this time that they would come to the kingdom's aid physically should internal cohesion fail or U.S. forces move. The Islamic world remains fractured, with former pariahs like Libya handing over nuclear materials to the United States, and Iran negotiating backroom deals with Washington. Al Qaeda is apparently resetting its sights on the royal family as well.
How long the leadership can juggle these issues is unclear, but what is apparent is that a deep-seated crisis is boiling in Saudi Arabia -- and there is little sign of the heat being turned down anytime soon.
(*) Dr. George Friedman is chairman and founder of Stratfor.com