November 10, 2022
November 10, 2022
“Oh no they didn’t!” came the collective gasp from Washington as Saudi Arabia decided last month to cut oil production and send gas prices skyward just in time for the US midterm elections. The reaction seems justified if you’re viewing Saudi Arabia’s decision to join other Organization of the Petroleum Exporting Countries (OPEC) nations and Russia to tighten supply purely through the lens of a celebrity smackdown, pitting US President Joe Biden vs. Saudi Crown Prince Mohammed bin Salman (aka MBS) or Russian President Vladimir Putin.
But viewed through a wider lens, the kerfuffle is overblown. Washington is, of course, smart to oppose any strengthening of Riyadh’s relationship with Moscow. Biden’s open-ended statement about possible US action in response to OPEC+ was measured and practical; we really don’t know what the best course of action is, because most of the options have serious downsides for the United States.
Those who remember the King Abdullah era of US-Saudi relations lament that Saudi Arabia’s approach to the United States has become purely transactional, and they’re not wrong. They should rest assured that what looks like a growing strategic relationship between Moscow and Riyadh is transactional for Riyadh as well. The Kingdom is hoping for a few things from Russia that the United States cannot provide—and they all relate directly to its most critical challenges.
Doing Russia a favor with its oil vote presents interesting possibilities for Riyadh vis-à-vis Iran, with which the Saudis severed relations in 2016. Consider the case of Russia’s recent acquisition of Iranian drones, which have been put to use in attacking Kyiv. It looks on the surface like the perfect reason for Saudi Arabia to kick Russia out of court. But it also presents a rare opportunity if the Saudis play their cards right with Moscow—just ask Israel—to examine these drones up close or receive data on their battlefield performance. Saudi Arabia also has a keen interest in preventing Iran from using these drones to ingratiate itself with Russia.
Saudi Arabia is hoping that wedging itself between Russia and Iran will bear fruit in Syria as well. Riyadh has accepted that Bashar al-Assad is sticking around, though US and Saudi strategies originally aimed for his departure from the political scene. Riyadh’s new goal is to pull Damascus back into the Arab fold and away from Tehran. But no amount of largesse from the Gulf will do the job and no effort to reduce Tehran’s influence will succeed unless Arab countries are willing to provide paramilitary forces and arms to Assad to secure his place at the head of government and replace the peace of mind Iran’s type of aid gives him. Riyadh has not entertained this. In the absence of an international strategy for reducing Iranian influence in Syria, or an achievable vision for the future of Syria from the US administration, Riyadh is pinning its hopes on aligning its interests in the future of Syria with Moscow’s.
Russia’s role in blocking potential new United Nations Security Council resolutions that would limit the transfer of arms to the Houthis in Yemen has frustrated Saudi Arabia for years. Gaining leverage to flip Russia’s position would address what Saudi Arabia sees as an existential threat. Russia’s dominance in the wheat market is also important to the broader Middle East, a region struggling with food insecurity. This includes Saudi Arabia, where less than 2 percent of the land is arable, according to the World Bank.
In addition to what Washington cannot provide, Riyadh is looking for a few things that Washington will not provide. Saudi Arabia has flirted with Russia’s SU-57 and China’s FC-31, both unproven attempts at approximating the United States’ F-35 new-generation fighter jet. Neither would interoperate with the rest of Saudi’s US- and European-made military aircraft. But Saudi Arabia’s interest in rapid military modernization is in direct conflict with both Congress and the Bureau of Political-Military Affairs at the State Department, which are putting the brakes on foreign arms sales.
Not to mention that an unscrupulous operator like Saud al-Qahtani—an adviser suspected of directing the murder of journalist Jamal Khashoggi who remains in MBS’s good graces—would likely love Moscow to include (under a benign information-sharing agreement, of course) some of its best practices on global assassination tactics.
Saudi Arabia’s relationship with the United States should have featured as prominently in its OPEC+ decision as Riyadh’s recent liaisons with Moscow. What did that side of the deliberation likely consider?
To begin with, the United States and Saudi Arabia have weathered eighty years of ups and downs; the relationship won’t implode under its current strain. As Landon Derentz, the head of the Global Energy Center at the Atlantic Council, reminded me recently, the United States and Saudi Arabia cooperated like pros to keep energy markets stable as the pandemic began, to the world’s benefit. This is part of an ebb and flow in US-Saudi cooperation on oil that corresponds to other pressures. In Washington these pressures are often political; in Riyadh they are often fiscal.
The United States and Saudi Arabia have weathered eighty years of ups and downs; the relationship won’t implode under its current strain.
This time the fiscal concerns focus on funding the Vision 2030 plan for developing the Kingdom across a host of sectors. MBS has a lot riding on the success of this plan. Stern warnings about a coming global downturn in oil demand have caused the Saudis to question why they are working against their own bottom line to meet their production quotas—at the United States’ request—when other producers are not. Saudi Arabia’s Oil Ministry cautions that over time, producing at the record-high levels the United States requests will zero out spare capacity. It could also mean the ministry can’t take facilities temporarily offline for planned maintenance, raising the risk that facilities could fail suddenly, shocking the market.
Separate but related, Saudi Arabia’s foreign minister pays particular attention to foreign affairs conversations in Germany after spending many years there. Right now, these conversations include dismay that the United States is refusing to reduce gas prices despite pleas from friends in Europe. The irony is not lost on Riyadh.
Other conversations in Europe about how to structure oil price caps sound ominous to energy producers in the Gulf concerned about such caps becoming common. And expectations of rising public pressure on these European governments once winter heating-oil needs spike cause some in Saudi Arabia to question how serious Europe will be about maintaining sanctions on Russia.
Add to these domestic concerns that few Saudis are in the mood right now to appease the United States because they feel that Washington can’t keep up its end of a deal. The US-Saudi transaction around Biden’s visit to Riyadh this summer involved Saudi Arabia and OPEC slightly increasing production while Biden authorized sales of defensive arms to Saudi Arabia. But world events have disrupted that gentlemen’s agreement. When Putin invaded Ukraine, European nations made independent decisions to donate arms, depleting their own defenses, which now require replenishment. As NATO countries, they skip to the head of the line of nations waiting for delivery of US defense articles. Delivery of items to Saudi Arabia may be pushed back by an additional two years as a result.
While this is not a situation where the United States is intentionally slighting Gulf partners, it is a very real problem for the Kingdom, which is regularly attacked with drones and missiles from armed groups backed by Iran. In some Saudis’ view, if extenuating circumstances require the United States to downgrade its end of the deal a bit, Washington should not mind when extenuating circumstances (such as a projected global downturn in oil demand) cause Riyadh to do the same. Saudi analysts who do not understand the cumbersome process of US weapons transfers watch the speed with which the United States has moved defensive arms to Ukraine and ask why Washington did not do the same after the 2019 Iran-backed attack on Saudi oil facilities in Abqaiq or continued attacks thereafter. Watch this space, since Riyadh claims that Tehran is planning an imminent attack on Saudi energy infrastructure again, and this time the White House says the United States won’t hesitate to act—though “act” is undefined.
With a burst of energy, Washington has begun looking for options to respond to the perceived slight by OPEC. There is a flurry of conversation about 9/11-based lawsuits, blocks on arms sales, the removal of Patriot air-defense systems from the peninsula, and “NOPEC” legislation, which could open the door to trust-busting legal action against OPEC and its member states. Riyadh has pushed back on each of these potential actions on and off for a decade—this is not the first time US policymakers have floated these punitive measures—through official, lobbying, and media-messaging channels.
Congress doesn’t agree on much, but there is support on both sides of the aisle for teaching the whippersnapper in Riyadh a lesson—as evidenced in May when a Senate committee passed NOPEC.
According to my conversations with Saudi officials, one of the promises the Biden team makes when meetings occur in Riyadh is that Saudi help with oil prices (or restraint in Yemen, or silence on the Iran nuclear deal, or assistance for Afghan evacuees, or sidelining Assad in Damascus) will be rewarded with friendly treatment in Congress. Riyadh feels like the US administration never delivered on that. Not even a little.
One of the promises the Biden team makes when meetings occur in Riyadh is that Saudi help with oil prices… will be rewarded with friendly treatment in Congress. Riyadh feels like the US administration never delivered on that. Not even a little.
Riyadh is now convinced that this promise of congressional softening was made because the administration did not have much more to offer, given constraints imposed by powerful members of Biden’s party vehemently opposed to negotiating with the government that murdered Khashoggi. Without the ability to bring much to the table before the midterm elections, Riyadh wonders, what will the administration be able to offer after, when it is likely at least one chamber of Congress will be controlled by the opposing party?
So what options does the United States have?
NOPEC resurfaces every time the United States is upset with the Kingdom. The Saudi government dreads it becoming law, but it has prepared for that scenario. Though NOPEC becoming law would certainly create oil-market instability, there is no guarantee that implementing NOPEC would result in the dissolution of OPEC. But for the sake of argument, let’s say it did. Breaking up OPEC in the near future would not alter Saudi Arabia’s ability to drive oil prices up. The Kingdom is, after all, the world’s primary oil swing state. Meanwhile other oil-producing states already can’t meet their OPEC quotas and would not be able to increase production any further even if freed from them. If anything, NOPEC could increase Saudi Arabia’s ability to drive prices up by taking refineries offline, perhaps with the polite excuse that these facilities suddenly require more than the regular amount of maintenance.
Saudi Arabia also took action in September that limits US options for punishing its leadership. The king made MBS prime minister, just days before a State Department opinion was due to a US court on whether federal common law grants the crown prince immunity from criminal charges in the United States. Now that he is prime minister, with the legal protections that confers, there is far less room for the administration to say he has no immunity.
One of the few levers the United States has at the moment is pending arms sales. Some lawmakers argue that halting these sales could change Riyadh’s mind about its relationship with Moscow. These sales are for defensive munitions loaded onto F-16 fighter jets and into Patriot batteries to defend the Kingdom against ongoing drone and missile attacks from groups that Iran’s president calls nonnegotiable elements of Tehran’s foreign policy. Therefore, as an unintended but problematic consequence, reversing the arms sales Biden approved in August would convey the message, “We condemn Saudi Arabia’s foreign policy, but we support Iran’s.”
Because the United States has raised the prospect of blocking arms sales to the Kingdom for the duration of the current administration, doing so now does not send a message as strong as its proponents intend. Riyadh likely predicted that Congress would make moves in this direction, has worked through the possible permutations of this scenario several times before, and in some cases has the possibility of alternate suppliers to fall back on.
Saudi Arabia might not be the loudest voice opposing proposals to prevent restocking their Patriots, either. The US military’s Central Command has been working with the Kingdom for some time, at a plodding pace, on bilateral missile defense. From Saudi Arabia’s perspective, the US military’s own plans—including a calendar of regular meetings with two-star and four-star generals in the Gulf—contradict actions by members of Congress to prevent restocking of their Patriots, or other more drastic actions such as pulling troops and Patriots out of the Kingdom. (This is not being seriously considered. It would be expensive to do and would be detrimental to the United States’ own goals in the region. But it is an option.)
All of this is to help explain how Riyadh views the issues enraging Washington and how Saudi officials interpret their own foreign-policy options and likely US reactions. They follow US politics, the economy, and American public opinion closely, far more closely than Washington follows the Kingdom’s. So how did we wind up here, with careful Saudi calculations nevertheless underestimating the ire with which the OPEC+ decision was received? In short, it’s a generational disconnect. MBS is thirty-seven; 60 percent of Saudi’s population is under thirty-five. They cannot relate to the emotional weight of a Russian invasion on the American zeitgeist.
The young leadership populating most of the innermost circle in Riyadh has no memory of the Cold War, but most US leaders were shaped by it. When a country invades a sovereign neighbor, it strikes a nerve in the United States. When that country is Russia, it gives the United States sciatica. Even the first Gulf War can’t help young Saudi policy leaders understand why their oil-market alignment with Russia has evoked such vitriol. MBS was five years old when the United States went to war to oppose Iraq’s invasion of Kuwait—and the United States has not gone to war for Ukraine.
Congress is going to tie itself up in details debating what should be done to respond to Saudi Arabia’s willingness to enable Russia’s cash flow while Russia is trying to erase Ukraine from the map. A searching review of US-Saudi relations is likely to be one option, though whether Congress can agree this time on just how tough it should be—after failing to do so in 2019 in the wake of the Khashoggi assassination—remains an open question. Reevaluating policy is never a bad idea; a focused review is always valuable. The White House has already pledged a review of the US-Saudi relationship following the OPEC+ decision, but it didn’t specify a point person or a timeline. Saudi watchers of all stripes expected Biden to review the US relationship with Saudi Arabia early in his administration (because he said he would).
Such a review shouldn’t be perceived in Riyadh as a threat. A thorough review of the relationship at all levels—not only on defense, but in fields such as water and food security; education; renewable energy; law enforcement; women’s rights; human, civil, and press rights; trafficking and illicit finance; and cultural preservation—will undoubtedly reveal a few low notes but several high notes that many officials in both capitals will find surprising and helpful in updating US policy. If Washington’s moves to punish Riyadh’s OPEC+ decision are restrained—and for example do not impact the delivery of defensive arms such as Patriot munitions—MBS’s advisers should work discreetly with US counterparts to minimize the oil deal’s impact on Russia’s ability to wage war in Ukraine. This could include funding defensive weapons for Ukraine or cooperating on efforts to prevent Iranian materiel from being available for Russian use.
MBS’s advisers should work discreetly with US counterparts to minimize the oil deal’s impact on Russia’s ability to wage war in Ukraine. This could include funding defensive weapons for Ukraine or cooperating on efforts to prevent Iranian materiel from being available for Russian use.
To reiterate a suggestion from Derentz at the Atlantic Council’s Global Energy Center, Saudi Arabia should also offer ideas for improving global access to affordable oil supply. “In the context of a major global energy crisis, the Kingdom would benefit from reasserting leadership over international efforts to increase supply, which would help redirect the conversation with the United States and Europe in a way that benefits both customers and producers,” he said. Saudi Arabia is the only nation with any leverage over Russian oil policy and output at the moment, so it is in a good position to help with this—and Washington should insist that it do so.
The problem for US policymakers right now is not that Saudi Arabia is choosing Moscow over Washington. The problem is that Saudi Arabia feels like it has the upper hand over both Moscow and Washington. Moscow and Riyadh played King of the Mountain over energy-sector dominance in March of 2020, waging a price war that Saudi Arabia won. And that was before Russia started a war that got it sanctioned. So the Saudis are very confident right now that they can control Russia’s options on energy policy. But transactional foreign policy being the order of the day, the United States and Europe will need to bring something to the table to make it worth Riyadh’s while to do so. Right now, that could be as simple as choosing not to enact punishments (that come with blowback) on Saudi Arabia for being a swing state.
US inaction following the 2019 attack on Abqaiq and blocks on arms sales in years since hint that Washington is over the Carter Doctrine of protecting Gulf countries against external threats. This OPEC+ decision indicates that Riyadh is too.
In both capitals, there are diametrically opposed opinions about how to reframe the relationship. Resolving those internal differences will be harder than reaching agreement between the two countries on mutual interests.
Therefore, a possible first step could be an informal track 1.5 process with both nations sending policy experts to discuss cooperation and redlines. The agreements signed during Biden’s summer trip to the Kingdom represent a solid list of sectors in which cooperation will create value for both countries, so some of the legwork has been done.
The deliverable would be a draft framework based not on a transaction to secure two individual critical objectives (energy for security), but on a set of shared objectives critical to both capitals. These do actually exist: Both countries have an interest in a smooth energy transition, regional security and stability, the free flow of commerce, and the harnessing of technology to advance development. The dialogue’s work should be based on a recognition that each country can move much faster and farther in partnership with the other.
This framework should also include a set of negotiated redlines, the crossing of which would void the agreement and require a re-convening of the track 1.5 process. Decisionmakers in both countries should agree to pursue the framework’s implementation regardless of cabinet shuffles or administration changes.
There is a second step Washington could take that would provide a win for all sides. A reevaluation of the US-Saudi relationship is a great excuse to clean up the US military footprint in the Kingdom. It’s past time. To quote one former official at the US Military Training Mission (USMTM) in Riyadh, “the 80s called and they want their security cooperation back.” Saudi defense ministry officials made clear to the Pentagon during a visit to Washington this year that there is support in the Kingdom for a reorganization of USMTM. This is because Saudi Arabia pays over fifty million dollars toward USMTM operations. Riyadh could slash this tomorrow, like they did six years ago to the US military organization that manages activities with Saudi Arabia’s National Guard. Military leaders in Riyadh are asking why they need to fund roughly 250 Americans with the mission to train Saudis on the use of US military systems if Washington refuses to sell them US military systems anymore. Add to this that USMTM operates under State Department authorities rather than the Department of Defense (DOD).
“A reevaluation of the US-Saudi relationship is a great excuse to clean up the US military footprint in the Kingdom. It’s past time.”
To achieve a win for all sides, the Biden administration could convert USMTM into a standard security cooperation office under the DOD’s Senior Defense Official for Saudi Arabia (as has been discussed since at least 2015), downsize to the staff necessary to run foreign military sales (FMS) cases, and redistribute remaining FMS administration billets to other locations. This would reduce the number of DOD personnel in Saudi Arabia, a win for members of Congress from both parties who are pressuring Biden to scale down the US military’s support for Saudi Arabia. It would modernize the structure of US security cooperation in the Kingdom, a win for the DOD. It would free up tens of millions of dollars in the Saudi defense budget, a little win for the Saudi ministry of defense. And it would preserve the US-Saudi strategic relationship, a win for the US administration.
If the vibe in Washington is that this approach is too soft, let’s remind ourselves who the adversary actually is at the root of the kerfuffle over energy production and prices. (Hint: It’s not Saudi Arabia.) Strengthening the United States’ partnerships abroad is a pillar of the new National Security Strategy precisely because it’s a proven method of securing US interests. Severing them is not.
Kirsten Fontenrose is a nonresident senior fellow with the Atlantic Council’s Scowcroft Middle East Security Initiative. She is president of the advisory firm Red Six International and a former senior director for the Gulf on the US National Security Council.