In early May, the U.S. House of Representatives Committee on the Judiciary was reportedly considering a bill to pressure the OPEC oil producers’ group to stop making output cuts by revoking the sovereign immunity that has protected OPEC+ members and their national oil companies from lawsuits over price collusion. (The committee previously passed the bill in 2018, 2019 and 2021.)
The OPEC Basket Price has hovered in the mid $70s, not historically high, though U.S. politicians like to talk down the price of gasoline before the summer driving season begins. (Saudi Arabia needs a price of $80.90 USD to balance its budget, and fund the diversification of its economy.)
Gasoline prices are higher than during the Trump administration, but the Gallup polling organization reported in April 2023, “Americans show significantly less concern about the U.S. energy situation now than they did a year ago.”
If American consumers aren’t up in arms over gasoline prices, and the recent OPEC production cuts have failed to stop the slump in crude oil prices, why might OPEC be a target now?
One reason may be the good news out of the Middle East: a rapprochement between Iran and Saudi Arabia (with Chinese mediation); Egypt and Iran starting to normalize ties (with mediation by Iraq); Syria rejoining the Arab league; the United Arab Emirates and Iran in talks to promote ties, and the possibility for energy cooperation between Iraq and Iran. The bill may be retaliation against the Arab OPEC countries, and a warning to others, for normalizing ties with Iran and Syria, under the color of protecting U.S. consumers. It also avoids a discussion about the Biden administration policy of limiting oil and natural gas production, though lately the administration has approved limited drilling in federal lands.
And not to be outdone, a bipartisan group of U.S. lawmakers just announced the “Assad Regime Anti-Normalization Act of 2023,” that would counter foreign governments’ outreach to Syria and allow for additional sanctions on anyone doing business with the Assad government.
The losers? Israel which probably can’t depend on the Arabs to form a bloc to back an attack on Iran’s nuclear research facilities; and the U.S., which is seeing its influence diminish as OPEC members in the Middle East start to normalize with the hated governments in Tehran and Damascus, and welcome China’s mediation of negotiations between Tehran and Riyadh, and Russia’s facilitation of talks between Saudi Arabia and Syria, and Syria and Turkey. (The worst-case scenario for Tel Aviv and Washington is Chinese participation in talks between Israel and the Palestinians.)
Normalization of relations between the Arab OPEC states and Iran and Syria would lower tensions in the region, which is not in Washington’s interest as big customers like the Saudis and Emiratis might scale back purchases of weapons intended to counter Iran. Tensions also keep the U.S. busy in the neighborhood to “ensure stability,” though U.S. actions in Iraq and Libya (and its supporting role in Yemen) guaranteed the opposite. And tension in the region makes it easy for Israel’s Shabbos goy in the U.S. to scotch any attempts to pressure Israel and the Palestinians to get peace talks going “or else,” especially if the Pals invite the Chinese into the process.
The U.S. may be failing to heed that the Middle East OPEC states, most run by kings or emirs, must pay attention to public sentiment – one secret of successfully ruling without elections. Though Iran is not popular with the publics in Arab OPEC countries, closer relations might result in less tension and more people-to-people ties and economic opportunity that will promote stability, which is more important than democracy for the Arab Spring generation according to a recent region-wide poll.
The 2022 Arab Youth Survey also found, “Nearly three-fourths (73%) want to see the US
disengage from the region. China, Turkey and Russia are now seen as the region’s strongest allies” and “the default position of looking to the West in times of crisis is being eroded by new allegiances to China, Russia and Turkey.”
This sentiment may see other Arab states, i.e., Saudi Arabia, not rushing to join American projects such as the Abraham Accords, which Israel still hopes will be a detour around peace talks with the Palestinians, and instead favor homegrown initiatives to stabilize the region.
Thus, Washington’s attack on the economic engine of the Middle East, petroleum, and use of sanctions to halt attempts to end conflict and alienation between the OPEC Arabs and Iran and Syria. It is important that peace not break out as that would depress weapon sales, increase regional economic diversification and integration and reduce the need for Washington’s “solutions,” and introduce to the region new economic and political players, such as China and Turkey.
Washington has a lot of power and can force events in the short term, but it has already lost the hearts and minds of Middle Eastern youth who, since 2001, have matured with the U.S. continuously engaged in combat operations in their lands – and all for nothing. For the future, it would be wise for Washington to remember the Cold War policy that understood that civil rights and economic opportunity for all Americans was the nation’s best weapon in the war of ideas with Communism. It worked against the Reds then and it will work against the Islamists now and, if America wants to be part of the future of the region it should stop being an example of the worst kind.