Aramco’s Diversification Strategy: Fueling Saudi Arabia’s Vision 2030
Aramco’s journey reflects not just the shift in Saudi energy policy but a broader reimagining of what national oil companies can achieve on the global stage.
2019 could be a tough year on Capitol Hill for Gulf Arab countries.
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DonateWith the monthlong shutdown of much of the federal government finally resolved, at least for now, the new Congress – especially the incoming Democratic majority in the House of Representatives – can begin to enact its agenda for U.S. domestic and international policy. Several Gulf-related issues are set to be prominent items at least through 2019, and possibly until the next presidential election in 2020. For Saudi Arabia, in particular, and also for its closest regional ally, the United Arab Emirates, 2019 will involve unusually intense and difficult relations with the House Democratic majority and also some internationalist Republicans in the Senate.
President Donald J. Trump has a low and declining approval rate, and many of his opponents sense a growing vulnerability as he begins the second half of his term. Many attacks will center on domestic issues, but foreign policy will be an important secondary battleground. U.S. politics have become intensely divisive, and the Cold War tradition of a consensus-based foreign policy is rapidly eroding. Some Gulf Arab countries, especially Saudi Arabia, have been drawn into these partisan and political arguments in a manner that makes their interests unusually vulnerable and attractive targets. The upcoming challenge will therefore not merely be a matter of fending off criticism and restrictions but also one of rebuilding frayed relations and emphasizing broad national partnerships rather than alliances with specific politicians.
Because of the partial shutdown, few committee meetings have been scheduled beyond preliminary ones in late January. And most early attention will be focused on hot-button domestic legislative imperatives and political controversies, such as the deployment of the military at the U.S.-Mexican border. However, key Gulf-related issues are likely to make their way onto the legislative agenda, including the Yemen war, the murder of Saudi journalist Jamal Khashoggi, new sanctions against Iran, domestic repression in Saudi Arabia, the boycott of Qatar, nuclear energy negotiations with Saudi Arabia, numerous high-level weapons sales to various regional allies, and possibly the patronizing of Trump’s private businesses, such as his Washington, DC hotel, by Gulf governments.
The Yemen conflict has already become a congressional flashpoint. In mid-December 2018, the Senate adopted, by 56-to-41, a measure instructing the Trump administration to remove all U.S. forces from “hostilities” in Yemen in accordance with the War Powers Resolution. The measure exempts all counterterrorism actions aimed at al-Qaeda, generally undertaken in partnership with the UAE in southern Yemen. Yet the UAE, like Saudi Arabia, may face mounting criticism regarding its own counterterrorism and counterinsurgency activities in Yemen, especially the alleged torture of detainees in UAE-run prisons. The bill was also a historic reassertion of legislative prerogatives regarding war making and has far broader implications than just the war in Yemen for the use of U.S. forces in conflicts around the world. But Trump supporters in the Senate like Republican John Kennedy from Louisiana have warned against lawmakers “cowboying” the issue and admonished lawmakers to work through the White House. It remains to be seen how far Trump’s Republican allies in the Senate who want to more gently pressure him on foreign policy will be willing to go in siding with Democrats in the House who will be trying to attack the administration much more forthrightly. With the House set to consider its own resolution early in the year, that may be tested soon.
It is a testament to the mounting concern about U.S. involvement in the Yemen conflict that this issue could prove a turning point in Congress’ long-standing de facto transfer of war-making powers entirely to the White House. It’s possible that some senators, especially Republicans, who voted for the resolution did so because there was no real possibility of a similar bill being adopted in the House in 2018 because of a leadership maneuver that kept it from coming to the floor. Nonetheless, the resolution demonstrates a recent conflation of a number of concerns, including perceptions of the war in Yemen, the state of U.S.-Saudi relations (especially in the aftermath of the Khashoggi murder), growing doubts about the Trump administration’s handling of U.S. international interests in general, and even the fledgling reassertion of a range of congressional powers ceded to the executive branch in recent decades.
That same day, the Senate also adopted a nonbinding “sense of the Senate” resolution generally criticizing the Saudi government for the Yemen war, the boycott of Qatar, domestic repression, and the Khashoggi murder. Yet even such nonbinding bills affect the atmosphere of U.S.-Saudi relations and serve as a clear rebuke to the Trump administration, pushing it to adopt more traditional U.S. approaches, especially regarding human rights. Unsurprisingly, it was greeted with an unusually strong rejection and protest by the Saudi government, which clearly understands the stakes.
One of the bill’s sponsors, Republican Mike Lee from Utah, called attention to the interplay between the Khashoggi murder and the Yemen war saying, “What the Khashoggi event did, I think, was to focus on the fact that we have been led into this civil war in Yemen, half a world away, into a conflict in which few Americans that I know can articulate what American national security interest is at stake.” And several senior lawmakers, some with long histories of warm ties to Saudi Arabia such as Republican Lindsey Graham from South Carolina, after being formally briefed by the CIA have specifically held Saudi Crown Prince Mohammed bin Salman, who is also the defense minister, responsible for the killing and implied that the United States should not deal directly with him on any issue from now on.
This confluence of issues is likely to continue throughout 2019, and possibly into 2020. A variety of factors ensured that the Khashoggi murder had a much larger impact in Washington than most comparable incidents, and there will be efforts to add Saudi domestic repression to this list of concerns. Already, efforts to pressure both the Trump administration and the Saudi government regarding treatment of detainees, especially women’s rights activists, some of whom have reportedly been tortured, is growing. Indeed, Khashoggi’s employer at the time of his death, The Washington Post, which has been leading a highly successful campaign to keep the issue in the public consciousness long after it might otherwise have faded, has explicitly attempted to link these issues. In an official January 26 editorial, The Post called on Congress to “stand up for imprisoned Saudi women” if the administration can’t or won’t.
Such calls are likely to grow throughout 2019 unless prominent women and other Saudi domestic prisoners are released. Indeed, the three most common complaints in Washington against Saudi Arabia – the Yemen war, the Khashoggi murder, and imprisoned women – are likely to be further conflated, or at least uttered in the same breath, by Riyadh’s critics in Washington. Both the House and Senate are likely to hold hearings on each of these three issues in 2019.
“Sense of” the House or Senate resolutions, or other pieces of nonbinding legislation, are obviously significant but primarily symbolic. Congress’ foreign policy powers are relatively limited, especially where significant foreign aid is not at stake. However, weapons sales need to be approved, or at least not blocked, by Congress to be successfully completed. Not only is this one area in which Congress could act effectively and pursuant to its traditional role, it would also demonstrate the legislature’s seriousness toward its two main audiences: the White House and the Saudi government. Trump has consistently emphasized U.S. weapon sales to Gulf countries, especially Saudi Arabia, as the prime feature of U.S.-Gulf relationships. And there is no doubt that Gulf Arab countries would be extremely concerned to find their weapons purchases opposed by congressional action.
Among the most obvious potential targets are approximately 120,000 precision guided munitions kits that Saudi Arabia has been trying to purchase to replenish stocks expended in the Yemen conflict. These were temporarily blocked, first by the administration of former President Barack Obama, then by former Senate Foreign Relations Committee Chair Bob Corker, and most recently by Senate groups including Democrats. Because they are directly related to the conflict in Yemen, this sale is an obvious potential target. However, against demands not to contribute to this bloody conflict, the administration and others will argue that without precision guidance, coalition munitions are more likely to go astray, killing civilians. In short, an effort to block precision guidance systems for munitions could be self-defeating if the intention is to reduce the number of civilians killed. If, however, it is simply to communicate U.S. impatience with the Yemen conflict and desire not to contribute to it in any way, even by making targeting more precise, those messages would be sent.
In addition, there are several Yemen-related aircraft sale and service contracts that could be targeted, as well as the Terminal High Altitude Area Defense anti-missile system. The latter is not only entirely defensive in nature and a huge, $15 billion, contract, the United States is also now in competition with Russia, whose S-400 system is touted as a potential alternative to THAAD in fending off incoming high-altitude missiles, presumably launched from Iran. Therefore, in the long run, THAAD is likely to be approved, and if it’s not, that will be the ultimate testament to a devastating deterioration in U.S.-Saudi relations, at least at the congressional level. For all the current disquiet, and even exasperation, this does not yet appear to be the case. But if Democrats in the House find that pressuring Saudi Arabia is an effective means of harassing the Trump administration, it could become an appealing potential strategy. The UAE may also face opposition to its long-standing efforts to purchase the cutting-edge fifth-generation F-35 jets, based on renewed concerns about human rights abuses in Yemen and the U.S. commitment to maintaining Israel’s qualitative military edge over any potential regional adversaries.
But the news isn’t all bad for Saudi Arabia and its allies. These same forces in Congress, Democratic and internationalist Republican, show few signs of being inclined to disrupt or complicate the Trump administration’s new sanctions on Iran. Even many who opposed the U.S. withdrawal from the nuclear agreement do not seem to want to come to Tehran’s aid and support, whether grudgingly or enthusiastically, the new campaign of “maximum pressure.” Israel’s backing for these policies is a key factor, but so is deep-seated suspicion of Iran throughout the U.S. political spectrum. These same concerns could mean that, insofar as it plays any role at all, Congress could seek to slow and even limit the U.S. withdrawal from Syria and any efforts to draw down further in Iraq. Therefore, the new Congress could serve as something of a brake on those aspects of the administration’s developing “America first” foreign policy.
There are many issues Congress does not appear inclined to embrace at this stage. There is no groundswell for pushing the administration to choose sides in the Qatar boycott controversy, where Washington has urged a resolution but not made relations with any of the principals contingent on any specific outcome. Saudi Arabia isn’t necessarily counting on the United States to be its primary supplier in efforts to create a fledgling domestic Saudi civilian nuclear energy program, so any continued congressional opposition to that won’t matter much.
Lawsuits pursuant to the Justice Against Sponsors of Terrorism Act, which allows U.S. citizens to sue Saudi Arabia over the 9/11 attacks, appear to be thoroughly mired in the courts and will probably not be an issue again confronting Congress for some time, if at all. But Riyadh faces pressure from some lawmakers over allegedly providing help to Saudis fleeing serious criminal charges in the United States. Democratic Senators Ron Wyden and Jeff Merkley from Oregon say Saudi Arabia may have helped up to five Saudis flee their state of Oregon when facing trial for major offenses such as manslaughter. Not surprisingly, these legislators linked these complaints to the Khashoggi killing and “a brazen pattern of disregard for the law” by the Saudi government.
Gulf Arab countries may find themselves drawn into congressional and other investigations into potential emoluments clause violations regarding foreign governments patronizing Trump’s hotels and other businesses. There have also been some media reports regarding interest by Special Counsel Robert Mueller’s investigation regarding a potential UAE role in what may have been back-channel meetings involving Trump campaign officials and Russian operatives. All this may be further investigated and become a growing headache for the administration, and poor publicity for the countries concerned, but ultimately not a major problem for Gulf governments that are not subject to U.S. laws and domestic political restrictions.
Gulf Arab countries will probably want to work with Congress to cushion the ongoing, albeit slow, U.S. disengagement from the Middle East and the Gulf region that began under Obama and is continuing under Trump. Though the disengagement seems virtually irreversible, it could be intensified or attenuated, and Congress will play an important role. The Trump administration has thus far adopted a Janus-faced, confounding attitude toward the Middle East. On one hand, the president and his officials trumpet the restoration of U.S. leadership and paint pictures of the United States operating with new resolve and effectiveness, especially in the Middle East. But on the other hand, they emphasize burden sharing and self-reliance among allies even more than the Obama administration did. Trump’s apparent determination to withdraw all U.S. forces from Syria will be viewed by many as another unmistakable indication that, rhetoric aside, Washington is continuing to draw down its Middle East presence and allow other actors in, notably Russia, which is resuming a regional role from which it was effectively excluded for decades.
Finally, Saudi Arabia, the UAE, and others will need to move quickly to repair frayed ties with Democrats and some Republicans to ensure that Washington at large views their alliance as one with the United States rather than the Trump administration. All these specific legislative and policy challenges must be secondary to the broader task of reminding a bipartisan swath of U.S. leaders why the United States and Gulf Arab countries have had such an important and long-lasting partnership and how dangerous the alternatives would be for both sides. In the current atmosphere of hyperpartisanship, traditional, broad-based U.S. foreign policy consensuses can be misread as merely reflecting the imperatives of one specific domestic political orientation to the exclusion of others. What used to be a bipartisan agreement on Middle East policy – alliance with Gulf countries, opposition to Iranian ambitions, etc. – might now be recast as just “liberal,” “conservative,” or “America first” policies that others feel a need to repudiate whenever possible, and especially if they regain power. That may be the greatest danger currently facing U.S.-Gulf relations, and one that certainly supersedes all the more tactical policy battles.
is a senior resident scholar at the Arab Gulf States Institute in Washington.
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