Another key variable must also be taken
into account. Not only the whole saga goes
way beyond an internal Saudi dispute; no
matter what Washington does, the
oil price has not crashed as expected.
This would indicate that the global surplus
of oil has been largely sopped up by falling
supply and increasing demand.
As a
GCC-based oil market source reveals, “have
you noticed how much attention Kerry and
Obama have been giving Saudi Arabia out of
all proportion to the past to keep that oil
price down? Yet WTI is up and holding over
$40.00 a barrel. That’s because oil demand
and supply is tightening.” The oil market
source notes, “oil surplus is now probably
less than a million barrels a day.” So the
only way, in the short to medium term, is
up.
Blowback from His Masters’ Voice?
The
House of Saud, by flooding the market
with oil, believed it could accomplish three
major feats.
1)
Kill off competition – from Iran to the US
shale oil industry.
2)
Prevent the competition from stealing market
share with key energy customer China.
3)
Inflict serious damage to the Russian
economy. Now it’s blowback time – as it
could come from none other than His Masters’
Voice.
The
heart of the whole matter is that Washington
has been threatening Riyadh to freeze Saudi
assets all across the spectrum if the House
of Saud does not “cooperate” in the oil
price war against Russia.
That reached the tipping point of the Saudis
shaking the entire turbo-capitalist
financial universe by issuing
their own counter threat; the so-called
$750 billion response.
The —
burning — issue of freezing all Saudi assets
across the planet has come up with the US
Congress considering a bill exposing he
Saudi connection to 9/11.
The declassification and release
of those
notorious 28 pages would do little
to rewrite recent history; 9/11 –
with no serious investigation — was
blamed on “Islamic terror”, and that
justified the invasion of Afghanistan
and the bombing/invasion/occupation
of Iraq, which had no connection to 9-11
nor any weapons of mass destruction.
The 28 pages did intimidate the House
of Saud and Saudi intelligence though.
Especially because the odd sharp brain
in Riyadh could make the connection; the
28 pages were being paraded around in
Western corporate media before the OPEC
meeting to keep the Saudis in line
on the oil war against Russia. That may
have been yet another Mafia-style “offer
you can’t refuse”; if the House of Saud
cuts oil production, then it will be
destroyed by the release of the 28
pages.
So
we are now deep into Mutually Assured
Threat (MAT) territory, more
than Mutually Assured Destruction (MAD).
No
one really knows how much Saudi Arabia
has tied up in US Treasuries –
except for a few insiders in both Riyadh
and Washington, and they are not
talking. What is known is that the US
Treasury bundles Riyadh's holdings
along with other GCC petrodollar
monarchies. Together, that amounted to
$281 billion two months ago.
Yet the Saudis are now saying they would
get rid of a whopping $750 billion. A
New York investment banker advances that
“six trillion dollars would be more
like it.” Earlier this year,
I revealed on Sputnik how the House
of Saud was busy unloading at least $1
trillion in US securities on the market
to balance its increasingly disastrous
budget. The problem is no one was ever
supposed to know about it.
The fact is the US and the West froze
$80 billion in assets that belonged
to the deposed head of the Egyptian
snake, Mubarak. So a freeze tied up with
framing Saudi Arabia for terrorism would
not exactly be a hard sell.
The nuclear option
For all the pledges of eternal love,
it’s an open secret in the Beltway that
the House of Saud is the object
of bipartisan contempt; and their
purchased support, when push comes
to shove, may reveal itself to be
worthless.
Now picture a geopolitical no exit
with a self-cornered House of Saud
having both superpowers, the US and
Russia, as their enemies.
Obama’s visit is a non-event.
Whatever happens, Washington needs
to sell the fiction that the House
of Saud is always an ally in the
“war on terra”, now fighting ISIS/ISIL/Daesh
(even if they don’t.) And Washington
needs Riyadh for Divide and Rule
purposes – keeping Iran in check.
This does not mean that the House
of Saud may not be thrown under the
bus in a flash, should the occasion
arise.
As the source close to Riyadh
advances, “the real nuclear option
for the Saudis would be to cooperate
with Russia in a new alliance to cut
back oil production 20% for all
of OPEC, in the process raising the
oil price to $200.00 a barrel
to make up for lost revenue, forced
on them by the United States.” This
is what the West fear like the
plague. And this is what the
perennial vassal, the House of Saud,
will never have the balls to pull
off.
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