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DJT and Xi of China agree that Hormuz Straits should not be controlled by Iran, and no tolls for passage through Hormuz on ships to be paid to Iran. Thedse are points of agreement with China at the summit between Xi and DJT in Beijing  May 14 2026. It is certain that Xi of China is also for no proliferation of nuclear weapons in the Middle East. China has to manage relations in the Middle East by considering the Arab  states of North Africa with whom it has good relations and their point of view- these countries are- Egypt, Moroccco, Tunisia, Algeria, UAE, Kuwait, Saudi Arabia. China gets its oil from both Iran and these Arab states. In a larger sense both the US and China are looking for alternative sources of oil after this episode of conflict in the Middle East one of a long series of events since the 1970's for 5 decades.  China and the US, India, EU are looking at this episode as a point from where a new renewed effort is being launched to replace fossil with renewable energy, be able to generate more GNP with fewer oil and energy resources. ...

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MBZ Mohamed Bin Zayed's leadership in UAE, the exit from OPEC and recognition of Israel, that is changing the Middle East. India has close relations with UAE and there are 9 million Indians working in the Gulf region. MBZ and Saudi leader Salman were close until both leaders differed on oil prices. Saudis wanted to keep oil prices high to finance its ambitious projects which contrasted with the UAE interest in increasing production. Saudis have a less diversified economy whereas the UAE has tourism and finance as other business sectors. UAE has capacity to produce 5 million barrels a day, but is only allowed by OPEC to produce 3.5 million barrels a day. US president DJT says UAE's exit from OPEC should lead to lower oil prices. About 250,000 British nationals live in UAE and millions of Indians. Even though the Abu Dhabi and Dubai region of UAE is small it has a large population of 12 million with about 10 million expatriates from India. It is also amore advanced economy with the help of the British and India, and now Israel. Saudi population is about 35 million and Saudis were poised to recognize Israel in 2024-2025. Egypt, the largest Arab nation, has shifted policy to be part of a Middle East that seeks modernization and economic development after decades of war and has close relations with UAE, so does Morocco, another Arab country with close ties to Europe and India.    ...

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BBC reports on Iran protests January 2026. Protests happened with students, with women periodically over the last two decades. Iran over the years since the monarchy in the 1880's and democratic movements (parliaments) in 1900's, monarchy in the 1930's and 1960's, socialist governments 1960's. Cold War and restored monarchy in 1970's, religious theocracy 1990's till today has gone through many different governments. It was part of the British Empire (that included India/Pakistan) and Russia's buffer region in the 18th and 19th century.  After economic sanctions from US and Europe the economy depends on sanctioned oil exports. Its defense operations divert much of the funding from oil based resources away from economic development . Much of that was a result of the anticolonial socialist ideologies that spread from North Africa (Algeria, Egypt) to Iraq and Syria that led to wars in Egypt, Syria, Iraq and Afghanistan- which also led to Iraq's version the Baathist ideology invading Iran. Russia and the US have extracted themselves at much loss from these conflicts by 2025 and are posed at a historic rapprochement in relations. For Iran there is today no danger from the region or from European powers, and like the US the people and the country are asking questions about the economic and living conditions from so much in resources now diverted to external conflicts- like the US the people in the region of Iran and the entire Middle East apart from a few small oil rich regions with a tiny part of the overall population- maybe 5% in Qatar and UAE, and Saudi- feel the impact of little investment in rapid economic development of the overall region. A region with a population close to the European Union of 500 million but a tiny fraction of economic development investment for the vast majority of people in Egypt and other parts of North Africa and regions of Syria, Iraq, Iran, Afghanistan, Sudan. Most of the investment of $1 trillion is concentrated in the 10% of the population of over 500 million people in oil resource Saudi Arabia, UAE/Qatar monarchies, the rest languishing in war, and now meaningless- in terms of living standards- of anticolonial ideologies or militant religious ideologies, or internecine/ethnic conflict. ...

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Only the week before Tuesday April 7 Pakistan Foreign Minister Dhar failed to convince China to get involved. April 7th Tuesday in the US 1.30 pm US time, 8 pm Islamabad Pakistan time, China finally decided to jump in to convince Iran to accept peace talks in Islamabad. It is quite possible that behind the scenes the US was talking with China which has a 25 Year Comprehensive Agreement with Iran signed in 2021 that is the main support for the Iranian economy. China acted to reassure Iran that talks in Islamabad would proceed smoothly, and persuade Iran to accept ceasefire and talks. Why? Knowing that brinksmanship by US and Iran would lead to unforeseen consequences and hurt China's economy with oil price volatility as well as  hurt the US economy, and hurt the prospects for the planned May14-15 visit by DJT to Beijing to improve economic and political ties, both China and the US wanted to do everything to prevent this from happening. The result a hastily arranged peace talks in Islamabad so that by 4 am Islamabad time on Wednesday or 6.30 pm US time on Tuesday evening the ceasefire had already been agree to by US and Iran, according to this report in The Guardian from Pakistan. The crux of the matter was that it would affect US and China's economy with oil volatility, and US-China relations by jeopardizing May 14-15 revised date for DJT visit to Beijing. This good sense prevailed over all the war rhetoric and the media information and disinformation. It is confusing because of all the misinformation, but becomes clear when one understands this in the context provided in this report from Pakistan by the Guardian. Why Pakistan? For Pakistan the missile attack the day before of a Saudi petrochemical complex by Iran was drawing Saudis into the war and Pakistan has signed a defense agreement with Saudi Arabia that requires Pakistan to support Saudi Arabia if it gets into a war. For Pakistan it was a fragile situation that would be a catastrophe with unforeseen consequences on its economy. Already schools are closed for 1 month in Pakistan and oil is in short supply, paying for it at $115 or $125 a barrel would put severe strain on Pakistan. Who wins, who loses is being told in the media- much less on the good sense that prevailed  the efforts and the predicament of the large powers China, India, the US, and Germany, European Union, the poorer countries, all hurt economically, caught in a war they do not want, do not need. ...

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Turkey is reviving its relations with Saudi Arabia and the UAE. Prince Bin Salman will visit Turkey as part of a remake of Turkey Saudi relations. Turkey's economic crisis has revived the relationship as Turkey badly needs aid for its economy. The pressure on emerging markets is increasing with US central bank raising rates reducing inflows of western money into Turkey even further. Prince Salman has already received visits from French and British leaders. He visited Jordan and Egypt this week and will now be in Ankara. In the summer he will visit Greece and Cyprus. Saudis are modernizing their economy changing culture in relationships of men and women, in women's rights and education, and broadening relationships with the world under Salman. There is an astonishing openness to science and technology in a drive to be modern. The old Saudi monarchy and conservative rule with ancient traditions is giving way to what the Saudis in the group under Salman see as the modernization of Europe and America in the 20th century using science and technology as what they would like to see in their own country. There is also a drive to think independently from the dogmatic positions of the past that have turned the Kingdom into an American dependency with no obligation or incentive to modernize its culture and be open to the world outside.  The US fought a war to ostensibly modernize a backward mountainous remote state as Afghanistan, while being perfectly comfortable with the old Saudi monarchies of the past that made little change in the ancient culture and tradition and in women's rights and education. Such were the contradictions in American policy and the failure to think anew. As president Lincoln said "as our case is new we must think anew, and act anew." President Biden will now visit Saudi Arabia to build a new relationship with an independent nation, which along with the UAE is bringing change to the Middle East through infrastructure development and modernization. Salman's modernization comes as the kingdom also faced a need to make a transition out of dependence on fossil fuels. Salman sees trips to Greece and Turkey as opening up to all sides. Saudis have good relations with Israel and Egypt another part of this openness. The US senses this, India has sensed this. India's Modi government  made sending the Oxford vaccines manufactured in India to Saudis a priority during 2021. The Indian example is also changing the way the UAE and Saudis see infrastructure development and modernization in the region. This is also changing the way the region is looking at itself. For decades Egypt lacking the resources to build infrastructure on its own has languished economically. A helping hand from the Saudis is changing Egypt. The entire rail system is being modernized with the latest technology from Siemens. The Saudis have stabilized the Egyptian economy with a $5 billion deposit in the Central Bank of Egypt. On June 21 Egypt and Saudis signed $7.7 billion in investment deals for infrastructure, logistics, port administration, food, industry, medicine, energy and technology. In the investments in Egypt some of the oil money going to Saudis with $100 per barrel oil price is going to an economy in Egypt that can easily absorb and make good use of the investment to modernize.   The influence of Saudi leverage in fossil fuels which drove the US relationship with Saudis since FDR is being replaced with an independent Saudi kingdom making decisions to modernize across the board in all aspects compared to one that favored a few American companies such as Exxon Mobil and ARAMCO or arms makers such as Boeing and Lockheed that helped recycle American money going to pay for Saudi fossil fuels back to America.    ...

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WSJ looks at the 75 years of the US Saudi Arabia relationship that started when US president Franklin Delano Roosevelt met Saudi king Ibn Saud at Bitter Creek, Egypt, on a US Navy destroyer ship in 1945. It has gone through many phases over this period and mainly involved the Saudi kingdom maintaining its supply of oil to the US and Western Europe. This relationship went through an oil embargo during tense periods of Israeli Palestine conflict as in 1983 with an oil embargo that pushed up oil prices. What is different this time is the situation in Yemen where Iranian supported Houthi rebels near the border with Saudi Arabia are engaged in a conflict with the Saudis. Democratic administrations under first Obama and Biden today support reaching a deal with Iran on nuclear weapons development and limit US military support for the war in Yemen. The Saudis for their part are not keen on a regional war and turned down efforts by president Trump to respond to attacks from Yemen. Mr. Biden's envoy has arranged for a deal to reduce tensions between the Houthis in Yemen and Saudis. The diplomatic impasse in relations stems from the Kashoggi incident and president Biden's concern for the human rights situation in Saudi Arabia. Other factors making relations difficult are the economic interests of the two countries diverging. The relationship Roosevelt started in 1945 has changed in its fundamental character. Oil supplies for imports into the US is no longer a factor for the US which was the original interest of president Roosevelt in Saudi Arabia. This changed by 2015 as the US fracking industry enabled US to become self sufficient in oil and able to supply LNG to western Europe. Instead of the US Saudi oil now goes to China. Russian oil also goes to China as its industry expanded with American investment. This has led to a new Saudi relationship with China which has changed the dynamic of the American Saudi relationship. Some of the new aspects of this can also be seen in Saudi relationship with South Asia. Saudi ties have increased with India and India in 2021 was the first country to provide vaccine supplies to Saudi Arabia. Saudis, Qatar, United Arab Emirates are building relationships with India as a close neighbor in the region. Relationships are in some ways improving in the Asian region compared to the period when oil was simply exchanged as a commodity for defense supplies from the US without regard to cultural, educational and other changes in Saudi society. In a sense US and Western Europe paid little attention to the huge democracy of over 1 billion people right in the middle of Asia and followed policies that led to major investments in China and little or no investment in India, and without realizing it followed a policy that the British had pursued in the British Empire of treating different communities and religions as separate as opposed to one community of people in South Asia that were engaged in modernizing, building infrastructure and changing centuries old ways of living. The British Empire was sustained by this kind of thinking, and as long as Indians were complacent and lacked the will to make their aspirations for a better life and infrastructure for modernization this kind of thinking prevailed. The economic crises in Asia have reinforced the idea that there is one community entirely focused on development and modernization in South Asia. The people in South Asia care most about the cost of living and the infrastructure and services for the quality of life they live and their children can aspire for- same in European Union that chose the Greens and chancellor Scholz, and same in the US that chose president Biden to invest infrastructure and people, the same in China and the same in India and the rest of Asia. This is the situation that the US and Britain, and the European Union are now beginning to learn and adapt to that is a constructive aspect of these changes to rebuild the connections and supply chains that were sorely neglected before now. ...

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The complex relations of Jordan and Saudis with US and Israel, in June 2025.  There is also the perception and actions of the two American parties Republicans and Democrats that have exacerbated the situation. This see saw of relations under the two parties in the US has only served to exacerbate the relations and draw the US into Middle East conflicts that have their origins in British colonial rule and interests of western oil companies from 1900.  During the Reagan period American involvement under Defense Secretary Rumsfeld to support the Iraqi invasion of Iran in a balancing act. And just a year earlier the Democrat Carter's efforts to look at the Islamic revolution as a response to the CIA's intervention in Iran's internal affairs under Eisenhower's Foreign minister Dulles to secure oil supplies, and efforts to find a way to good relations with Iran. This was followed by the Democrat Obama negotiating with Iran, normalizing relations and Democrat Biden handing over Iranian assets  of hundreds of billions of dollars that were used DJT says to build its military that had suffered badly under the earlier western sanctions under Republican Trump.  It has led to some of the migration from Syria after Russian involvement that flooded Germany with millions of migrants and destabilized European countries democratic processes. These earlier interactions between US and Iran have turned into an Iranian effort to develop its nuclear capabilities bringing the situation faced today, and showing the failure to find solutions of everything tried before and not helping the people of the Arab World and the Gulf regions.   ...

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The Guardian gives this story of Khamanei's rule in Iran after 1989. He was made president in 1981 in a landslide win at that time just 2 years after the revolution in 1979 that toppled the Shah of Iran's monarchial regime. Khamanei comes from a the family of a modest cleric in the town of Mashaad who was immersed in the anticolonial writings coming out of Arab North Africa's liberation movements. His policy towards Israel and the US, difficult relations with Arab countries in the neighborhood, and pursuit of nuclear weapons technologies, led Iran to become isolated and face sanctions that hurt its economy and its oil industry for three decades. It created its own version of governing and in setting up proxy militias but this resulted in huge investments diverted from the economy of Iran, neglect of its oil industry and production under western sanctions, that led to economy collapsing and student protests every decade. This expanded in 2025 to broad sections of the population calling for a new direction. Protests were suppressed leading to a disconnect with the people by 2026. To truly understand Iran one has to step back to the 1900's ( as one must also do to understand China or India), as Iran was ruled by the Qajar dynasty at the time. The first Majlis parliament was set up in Iran in 1906 -with the help of "good" Britishers like the British agent in Rajkot who helped send Gandhi to London to study law- wished to see a constitutional setup similar to Britain and limit the powers of the monarchy so that reforms in agriculture and in the civil service could be made. It lasted until 1908. At the time other Britishers in the British Empire both in India and in London sought to maintain British influence and keep out Russian influence. It was not a coincidence that the Majlis lasted only till 1908. That year in 1908 the first discovery of oil in West Asia was made in Khozestan province by George Reynolds, with investor backing of William D'Arcy. The following year 1909 the Anglo-Persian Oil Company( later Anglo Iranian Oil Company and later British Petroleum) was formed. The oil concession was given by the Shah from Qajar dynasty. From that time on Iran became the scene of oil company interests, monarchial interests first under Qajar dynaasty and then under Pahlavis dynasty (which set itself up like Napoleon II in France from humble origins, after 1925 to replace the Qajar dynasty), and the emerging middle class lawyer and civil service, agricultural landowners class, all competing for power and influence in a Asian region with Shihite Islamic embedded in the fabric of the society. Power swung to different groups from 1925 onwards for 5 decades to the 1979 revolution that overthrew the Pahlavi temporary replacement monarchy that worked with British oil interests. West Asia became a meeting point for anticolonial writings emerging from Arab North Africa and other places that took the form of and led to a socialist style anticolonial Baathist influnce that overthrew a monarchy in Baghdad Iraq in the "Free Officers" coup of June 14, 1958 led by Karim Kassem. Out of that Pan Arabic Iraqi mood emerged S. Hussein who with weapons systems imported from the US and Europe initiated the war with Iran in 1980. The Iranian counterrevolutionary movement to Iraq began from that time with the leadership of Khomeni and Khameni from 1981. This is what one has seen swing back and forth in the West Asian region for about 5 decades to 2026, the regional Arab states mostly Sunni monarchies ranged against Iran with its Shiite and also modernizing population. US oil interests in Arab monarchies of the West Asian region from the time of FDR's meeting with Saudi's Faisal in the WWII period clashed with Iranian public interests competing with oil interests (US and British) allied to monarchial interests, and the emergence of Shiite Islamic authority in Iran in these clashes. Iranian public interests that started out with the Majlis and parliaments set up by the "good Britishers" never got a chance in Iran just as the modernizing effort of Sun Yat Sen in China in the 1900's never got a chance in the middle of the surviving monarchy in China by 1910, and the Japanese colonial interests in China from that time competing with the Nationalists Koumintang and the Communist Chinese workers movements emerging in the 1930's, all competing for influence during the Chinese civil war and in its aftermath the emergence of Mao and the CCP of China. This is the situation we in the world face today. ...

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King Salman appoints Mohamed bin Nayef, 55 years-old, as the deputy crown prince in Jan. 2015. The crown prince is Muqrin Abdulaziz, 69 years-old. Mohamed Bin Nayef is the son of the Interior Minister, who worked under his father from 1999 till he became the new Interior minister in 2012. Nayef has pursued an aggressive program to remove Al Qaeda in Saudi Arabia. By taking action against all dissent inside Saudi Arabia Nayef has also jailed human rights activists, including the flogging of a blogger critical of the government. The defense minister Prince Mohamed bin Salman, is a son of King Salman. King Salman was defense minister till he succeeded his half-brother Abdullah. Ali al-Naimi continues as Oil minister, a position he has held for decades. Saudi Arabia established a panel in 2006 to work with future kings after King Salman to appoint an heir to the throne. Even with the appointment of Nayef, a grandson of Saudi Arabia's founder, Abdulaziz ibn Saud, as deputy crown prince, the leadership of the country remains within a small number of princes of the royal family. Under the Obama administration the relations between U.S. and Saudi Arabia have become strained with president Obama's failure to intervene in Syria. The Saudi have pursued their own policies since then, in first Bahrain and then Egypt the Saudis supported the monarchy and the military respectively to maintain power in the face of the Arab Spring. The danger is that Saudi policies may be contrary to the U.S. position supporting freely elected governments and basic rights, particularly when it comes to suppression of all dissent including peaceful dissent and normal criticism of government, and yet with the rise of Islamic State the U.S. puts itself inadvertently behind these very policies. The Saudis would say this has happened because U.S. president Obama failed to support the effort for freedom in Syria and a transition in Libya and Iraq (with the added complication of Maliki's sectarian policies), creating a war torn neighborhood in which the Saudis had to act on their own. These are the hidden costs of the policy of the U.S. president for the U.S. and for the Middle East- more sectarianism with Shiites and Sunnis openly in conflict, reversal of hard won gains in Iraq, reversal of the Arab Spring except in Tunisia, war torn Libya and Iraq- with a withdrawal that never truly happened because it required a firmly guided transition period of support in the region with lower cost and involvement of an extended period leaving no room for reversal of gains. It leaves both the Saudis and the U.S. in a more precarious position than a decade ago....

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Scott Shane of the NYT provides this exceptional account of how the ideology of Wahhabism on which the Saudi monarchy is based has influenced the evolution of Islam, but not in the way other religions have evolved into more moderate and open religions. Christianity evolved from the period of religious conflict, and evolved to the point that the basis of progress was based on education and technology in most of northern and southern Europe. Where the evolution did not take place because of more intolerant behaviours such as in Spain with the Spanish Inquisition and ideas from the medieval period, this development based on education and technology lagged severely behind.  Wahhabism developed as a result of a sect started by a religious cleric Wahhab in a poor desert region around Mecca and Medina, now the Saudi Kingdom, who sought the help of a tribal chief Ibn Saud. They used the religious-political alliance to gain tribal dominance in the region. Wahhabism sought to change Islam by banning worship and religious rites at tombs common in that period. It also as Brookings scholar William McCants cited here says, drew "sharp lines" and intolerance between believers and non-believers- all non-believers including other sects of Islam, Shiites, Christians. The movement spread throughout the region, but was crushed by the Ottoman Empire based in Istanbul, Turkey, by the 1850's, only to be revived in the 1920's following the collapse of the Ottoman Empire. A Norwegian expert Heggenhammer cited here says clearly Islam did not benefit from the evolution that other religions had, and Wahhabism has slowed this evolution into and open, tolerant religion because of its "sharp lines" and intolerance of other faiths and ideas with the Wahhabism from a medieval perod. In India the British rule brought enlightenment thinkers (John Stuart Mill for example was a clerk for the British East India company). But no such change happened under Ottoman rule to inspire leaders like Gandhi and Nehru to setup a new constitution that made changes from medieval Hindu beliefs such as caste and religious practices based on superstition.  The development of an oil rich state in Saudi Arabia with the discovery of oil, and the dependence from 1950-2010 of the global economy, has led say experts to the export of the Wahhabist kind of Islam to other countries in Middle East and South Asia. This they say made the evolution to democracy and peaceful coexistence difficult or impossible in the region. ...

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India agrees to an immediate ceasefire after a call from Pakistan's head of military operations for a ceasefire. The conflict started with attack on tourism that was reviving the Kashmir economy after three decades through a terrorist attack killing 26 tourists in Phalgam, Kashmir on  April 22, 2025 in the mountains near the Pir Panjal range. 24 million tourists visited Kashmir in 2024. Indian response was swift on May 7 early morning hours attacking 18 terrorist camps inside Pakistan occupied Kashmir and inside Pakistan. India called it a act of self-defense to Pakistan sponsored state terrorism going back to 1947. What is different in this brief 4 day war is that India made it economic with efforts at IMF to make terrorism an issue for loans to Pakistan, and ending the Indus Waters Treaty on water sharing. Pakistan economy is struggling with no debt relief from China, making it turn to the IMF, a politically split population with Opposition leader Imran Khan in jail, and continued domination by the military over civilian govenrment. On May 9 drone attacks were launched from Pakistan using Turkish made drones in large numbers on cities and towns in Gujarat, Rajasthan, Punjab. Blackouts were placed in India by May 8 in all cities in the north and in Pakistan. India responded with its own drones and missile attacks on three military airbases as the war broadened to military targets on May 10. US mediated a ceasefire through Saudis and Turkey. Earlier Saudis and Iran were in New Delhi with whom India has good relations to get a ceasefire. Mr. Trump's efforts behind the scenes secured an agreement. VP Vance had cut short an Indian trip in Jaipur on April 22. India and the US are allies in the Indo-Pacific, and India and Russia have decades of friendly relations. China now uses Pakistan as a proxy state, but does not provide the economic aid it needs, for which it has turned to the IMF.    ...

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Hubbard and Erdbrink report on U.S. president Trump's visit to Saudi Arabia to begin a new chapter in relations with the Gulf nations and the Saudis. Under president Obama the U.S. distanced itself from the Saudis and the Gulf nations, preferring to pursue a policy of closer relations with Iran and signing the Iran nuclear deal. This included a policy of staying out of Syria to the point of turning down a decision to deploy U.S. airpower to maintain no-fly zones to protect refugees. Syrian government forces fighting rebels were supported by Iran. The new policy is dictated by the new conditions in the Middle East. The U.S. has sought since the presidency of Reagan to balance the power relations in the region. With the nuclear deal signed and Iran respecting the deal according to independent reports, the U.S. allied with Iran in the battle against Islamic State in Iraq,  a shift was needed to balance the support provided to Iran by Russia which worsened the refugee crisis in Syria. The Republican party and Mr. Trump were critical of the Obama Iran policy during the nuclear deal negotiations. The safety of Israel is also a factor as non-state actors were supported by Iran threatening Israeli security. For these reasons the shift is an effort to rebalance the relations in the region. The arms deal in its size and president Trump's statement that Iran had "fueled the fires of sectarian conflict and terror," can be seen as this rebalancing. A business aspect of the large arms deal is that it will promote job growth in the defense industry in the U.S.. Other countries including Germany have seen growth in their defense industry. This is not the best way forward for the Middle East, yet it is a way the U.S. and nations in the region are adjusting to realities- the collapse of the Arab Spring from within and without the help from outside, the sectarian conflict arising from the Shiite pushback from Iran following the Baathist and Sunni control of Iraq which collapsed with the U.S.invasion, where the majority of people are Shiite yet with a strong Sunni presence. Elections brought Shiites in power, leading to a Sunni response in the form of Islami State caliphate move into Mosul, Iraq's second largest city after Baghdad. A decade of conflict and the efforts by the Bush administration ended in failure and sectarian conflict, resulting in the U.S. policy of rebalancing in favor of Iran to negotiate the nuclear deal. In this sense the arms deal does not solve anything. A similar rebalancing under Reagan by arming one side, followed by arming the other, led to involvement with ground forces under president Bush. It only leaves the region poor after years of sanctions against Iran to the point where a NYT reporter was not sure whether it was safe to fly from Tehran to Mashad with Iran Air because of the lack of spare parts for the airline. War torn, with millions of refugees in Syria and Iraq, the region remains broken in many ways, waiting for a sensible non sectarian view to prevail in the interest of the people in the region. The election of Rouhani in Iran by 57% of the vote is only a sign that young people in the region given a chance would opt for a different course in future. The rest of Asia has moved forward and shows a path that can be followed. ...

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Saudi Arabia continued to follow a policy of high oil production in 2016, and reported that it produced 10.67 million barrels a day in July 2016. Iran is producing at a pre-sanction level of 4 million barrels a day. 2017 oil demand prediction by OPEC is at growth of 1.15 million barrels a day. Experts says that the interests of Iran and the Saudis may be converging to reduce production as they face low oil prices. Iran needs to make large investments and Saudis face budget cuts with low oil prices. They point to this cooperation being temporary as there are issues of competing politics in the region, and beyond that both countries seek to expand their market share.

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In response to bellicose speeches by Republican presidential candidates Mitt Romney and Rick Santorum at the American Israel Public Affairs Committee conference on March 6, 2012, President Obama stated at a press conference: "This is not a game..The one thing we have not done is we have not launched a war.. If some of these folks think we should launch a war, let them say so, and explain to the American people." The U.S. president, advisors and intelligence officials believe that Iran has yet to acquire a nuclear weapon, that there is time for sanctions to work and make the Iranian government give up any weapons programs it is working on. Their view as stated by the U.S. President is that this time cannot be measured in two days or two months. Recent elections in Iran show divisions in the government between the Ayatollah Khamanei and premier Ahmadinejad, with the elections favoring candidates supporting Khamanei. There is also the dynamic of changing relations in the Middle East- between Iran and other countries such as Iraq, Turkey, Saudi Arabia, India- which have strong ties to the U.S., and Iran's relations with China and other countries which have close economic ties to the U.S. In addition in a country with a demographic skewed heavily towards younger people and a third of the people under 15, the democracy protests in 2011 about a flawed election in 2009 are supported largely by university and college students. That election may actually have been stolen by Ahmadinejad from Mr. Moussavi, who in an election eve television debate accused Ahmadinejad of "adventurism, illusionism, exhibitionism, extremism, and superficiality," (Nazila Fathi, NYT 6/4/2009). These factors are likely to be behind the Obama administration's sense of a "window of opportunity," to use Mr. Obama's words. Recent polls by the University of Maryland's Prof. Telhami show only 19% of Israelis favored a military strike without U.S. backing in Feb. 2012, and Israeli public opinion experts see Obama's position as reflecting a sound judgement. Research by Citigroup shows that at a price for Brent crude of $120 with an escalation in Iran, it would take 9% of the world's GDP to support the higher energy costs, hitting Europe especially hard (Liam Denning, WSJ 1/6/2012)....

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This report by David Sanger in the NYT cites insiders in the Obama administration suggesting that the Saudis never really considered the peace talks in the region organized by Secretary of State Kerry as a serious effort with the escalation in the bombing by Russia, and other events including Iran's two ballistic missile tests. Turkey was drawn into the conflict with Russian bombing of ethnic Turkish groups at the border with Syria. By ignoring these events affecting Turkey, Saudi Arabia and other countries, the Obama administration appeared to be calling for a peace effort that seemed to have little prospect of succeeding. As Trofimov suggests in a separate report in the WSJ the Saudis were more focussed on winning domestic support from conservative Sunnis, seeing the Obama administration as ineffective on the issue of refugees from Syria and the conditions for the civilian population.

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Karen Eliott House was a former publisher of the WSJ. Now with WSJ in Murdoch's News Corporation's hands, she is a fellow at Harvard's Belfer Center. Here she points to the diverging situation between the USA and Saudi Arabia. She thinks the US cannot protect the Saudi monarchy (which dates back to Abdul Aziz and his support from President Roosevelt first by recognition of the new state of Saudi Arabia in 1932 and support during the war), from its domestic challenges. One of these domestic challenges is changing demographics as the young or people below 15 years age make up 40% of the population, rising unemployment, and pressures for modernization which the monarchy has done little to respond to, and the lack of democratic forms which would give people a chance to vent their feelings. For the U.S. the frustration is that the Saudis have done little or can do little for the USA in the way of moderating oil prices as they move still higher, because of speculative trends, decline of production in its own maturing oil fields, and needs to finance huge new plants and cities to provide employment to a growing population. In fact Libyan oil officials has been more of a moderating influence recently than the Saudi oil officials. So it appears that what Karen is saying is that the Saudis are pursuing their own interests in their region and the wider region that includes South Asia and Northern Africa, and the US is pursuing its own interests, which at this time are not as clearly defined, except securing oil supplies and protecting Israel. The 2 countries USA and Saudi Arabia are going their diverging and different ways in a way that is irreversible....

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Karen Elliott House, a widely respected expert on Saudi Arabia, gives her assessment of the Saudi situation as the Obama administration completes a nuclear deal with Iran in July 2015. She says the Saudis have few options in the short term. She also points out that the unfreezing of $100 billion in assets of Iran by the end of 2015, and the lifting of economic sanctions, could exacerbate tensions in the Middle East if Iran uses the money to increase support to proxies in the Middle East. Saudi Arabia has a large population of young people and high youth unemployment, increasing political risks, says Karen House.

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Jim Krane of the Judge Business School at Cambridge University, points to an important development- the increasing consumption of oil in Saudi Arabia that is shrinking its ability to be a reserve supplier in the Middle East when a Iraq, a Kuwait or a Libya's oil supplies are cutoff. Saudi population and industry is growing and is using up a quarter of its oil production. Consumption is at 3 million barrels a day, more than the oil consumed in Germany, and is growing at 10% a year. Use of oil is subsidized by the government and with social spending up in Arab countries a cut in subsidies is not expected anytime soon. Projections by Jadwa Investment of Riyadh show that the reserve margin will disappear by 2020. By 2038 Chatham House in London predicts Saudi Arabia will become an importer of oil. This is important because America's sanctions against oil imports from Iran require the Saudis to step up and act as the reserve supplier. This happened with Libya, and 1.5 million barrels a day were cutoff after the revolution. Iran exports 2.2 million barrels a day. This will keep supplies tight and keep pressure on oil prices in 2012-2013....