All Articles (82)

1. Syria: Turkish armed forces, backed by their Syrian opposition allies, the Free Syrian Army (FSA), entered Syria on 20 January, and a month later were making slow progress in their attempt to take the northern Syrian town of Afrin from the Kurds under the mis-named “Operation Olive Branch”. At least 31 Turkish soldiers have been killed and several hundred injured, and scores of battle vehicles destroyed. Its Kurdish enemies are already gleefully referring to the campaign…

After his extensive interactions with West Asian countries, the UAE, Saudi Arabia, Iran and Qatar, in 2015-16, and two meetings with Israeli Prime Minister Benjamin Netanyahu, Prime Minister Narendra Modi embarked on his second tour of West Asia on 9-12 February, which took him to Jordan, Palestine, the UAE and Oman. After a quick stopover in Amman, Modi went on a stand-alone visit to Palestine, emphasising that India has “de-hyphenated” its ties with Israel and Palestine and will interact…

1) Saudi economy: On 1 January, Saudi Arabia announced a SR 978 billion ($ 261 billion) budget for 2018, describing it as the largest budget in its history in terms of spending. 
 
The budget, which in the past has been 90 percent dependent on oil revenues, is this year not more than 50 percent based on revenue from oil. The remainder is 30 percent from non-oil revenues, 12 percent from public debt and 8 percent from government…

The fall in the value of the dollar has boosted oil prices: on 23 January, Brent crude traded at $69.41 a barrel, up 0.54 percent, while WTI crude was at $63.89, up 0.5 percent. Later, on 29 January, WTI crude traded above $66 a barrel, the highest since December 2014. Thanks to shale oil, US crude oil production is poised to break records by surpassing 10m barrels a day in 2018. The country’s net imports of crude oil and petroleum products fell below 2.5m b/d late last year, the lowest…

1) Syria: US Secretary of State Rex Tillerson announced on 17 January that US forces, numbering about 2000, would remain in Syria. He said this was “crucial to our national defence” and mentioned three reasons: security of Israel; preventing the re-emergence of ISIS, and “expelling malicious Iranian influence” and preventing it from dominating the Middle East. This proposal has evoked sharp criticism from Stephen Kinzer, formerly of the New York Times, who said Tillerson’s…

At year-end, West Texas Intermediate (WTI) crude futures settled at $60.42, the highest close since June 2015. Brent crude futures were at $66.62 a barrel, after briefly crossing $ 67. This 17 percent rise in Brent prices was supported by ongoing supply cuts by OPEC and Russia as well as strong demand from China.

WTI prices were supported by data from the U.S. Energy Information Administration late on 28 December showing that domestic oil production declined last week to 9.75 million…

1. Iran: On 14 December, the US defence department displayed at a hangar at a joint base at Anacosta-Bolling, Washington, three intact Iranian weapon systems and debris from a fourth, apparently recovered from the battlefields of West Asia. Recalling President Trump’s Iran strategy announced in October, the department spokesperson said these missiles were proof of Iran’s malicious strategy, specifically “evidence of Iranian weapons proliferation in violation of U.N. Security…

Chabahar port inaugurated: The Chabahar port phase I was inaugurated by Iran’s President Hassan Rouhani on 3 December. It marks an important milestone in India-Iran relations as well as the resolve of Afghanistan and India to look for a viable transit corridor to landlocked Afghanistan, bypassing Pakistan.

Chabahar port is located in the Gulf of Oman along the Makran coast, in the Iranian province of Seistan-Baluchistan, just 75 km from the China-built and operated…

Oil prices moved up on 15 December, lifted by the Forties pipeline outage in the North Sea and ongoing OPEC-led production cuts, although rising output from the United States kept a lid on markets.

U.S. West Texas Intermediate (WTI) crude futures were at $57.28 a barrel, up 26 cents, or 0.5 percent, from their last settlement. Brent crude futures were at $63.47 a barrel, up 16 cents, or 0.25 percent, from their previous close. The ongoing outage of the Forties pipeline, which carries…

1) US President Trump recognises Jerusalem as Israel’s capital: On 6 December, US President Donald Trump announced that the United States would recognise Jerusalem as the capital of Israel and that the US Embassy would be moving to that city. He added that he still supported a two-state solution and this recognition would not affect the final status of the city to be negotiated between Israelis and Palestinians as part of their peace agreement. Trump thus fulfilled his…

1) Developments in Saudi Arabia: Through the last fortnight, updates on the detentions of senior royals, ministers and business persons carried out on 3rd November continued to be reported, though the veracity of many stories cannot be confirmed. Thus, it has been reported that Saudi authorities are striking agreements with some of those detained in an anti-corruption crackdown, asking them to hand over assets and cash in return for their freedom. The deals involve…

At a ministerial conclave in Vienna on 30th November, OPEC and some non-OPEC oil ministers agreed to extend production cuts, totalling 1.8 mbd, through to the end of 2018, in a bid to tackle a global glut of crude oil and keep prices buoyant. Following the deal, which ministers hailed as historic and unprecedented, the price of Brent stood at $63.28 a barrel, up 0.27% on the day. WTI crude rose by 10 cents to $57.40.

The extension will be reviewed in June to assess whether the glut of…

1. Oil prices: Oil prices touched a two-year high on Friday, 10 November, with Brent reaching $ 63.6 and WTI at $ 56.82; prices have risen by about 14% over the last month. Prices have risen due to: drawdown in inventories, especially in the US; better compliance with voluntary production cuts by the Organization of the Petroleum Exporting Countries (OPEC); slower pickup in US shale oil production, and continued geopolitical uncertainty in West Asia following the…

1.  Wide-ranging purge and detentions in Saudi Arabia: On 3 November, in a dramatic coup within the royal family, engineered by King Salman and his son, Crown Prince Mohammed bin Salman, eleven princes, along with four sitting ministers and several former ministers and officials were detained. Prince Miteb bin Abdullah, the commander of the National Guard, the country’s powerful domestic security force, was summarily dismissed and detained, so that force…

1. Oil prices cross $ 60: Oil prices rose strongly on 26th October before breaking two-year-highs on the next day. Brent crossed $ 60/ barrel to reach $ 60.13, though WTI remained subdued at $ 53.90. The price gains came after robust US demand data from the EIA, reports of declining inventories and rising confidence in an extension of production cuts by OPEC. Some analysts feel this might not be a long-term trend: in recent times, when prices have reached $ 60, they have…

1. Saudi economy contracts: Saudi Arabia’s economy contracted by 1.03 percent in the second quarter of this year following a 0.5-percent contraction in the first quarter, as participation in the OPEC oil production cut and disappointing growth in non-oil industries weighed on the economy. According to Bloomberg, slow growth in the non-oil economy is insufficient to offset the impact of lower oil output or to reduce unemployment. There has been little momentum in the non-oil…

1. Yemen: The United Nations Human Rights Council decided on 27th September to establish an international team of experts to examine abuses in the Yemen war and seek to identify those responsible. The decision has enabled Saudi Arabia to avoid a formal panel of inquiry like the one investigating the war in Syria.

The United Nations high commissioner for human rights, Zeid Ra’ad al-Hussein, will appoint “a group of eminent international and regional experts” to conduct…

1. Prices show an upturn: Almost nine months after OPEC and its non-OPEC partners implemented production cuts in a bid to rebalance oversupplied markets, tighter supply and demand fundamentals are now supporting prices in a higher $50-55 per barrel range.

Against a backdrop of much stronger oil markets, the OPEC and non-OPEC Joint Ministerial Monitoring Committee (JMMC) concluded its September 22 meeting noted the alliance had reached its highest ever level of…

1. Iraq: On 25 September, the Kurds voted overwhelmingly to secede from Iraq and set up an independent state. This referendum had been announced in July by Masoud Barzani, the president of the Kurdistan Regional Government (KRG). Over the last two months, the Iraqi Government headed by Prime Minister Haidar al Abadi made every effort to persuade Barzani to cancel the vote and discuss federal and other issues with Baghdad. These views were echoed by its neighbours, the US,…

On 11 September, Saudi energy minister, Khalid al-Falih, was quoted as saying he agreed with other OPEC nations to keep all options open in the organization’s push to re-balance world oil markets, “including the possible extension of output cuts beyond next March.”

Oil prices edged lower on 11 September on concerns that Hurricane Irma’s pounding of heavily populated areas of Florida could dent oil demand in the world’s top oil consuming nation. Goldman Sachs said that oil demand is…

About the Author

Ambassador Talmiz Ahmad joined the Indian Foreign Service in 1974. Early in his career, he was posted in a number of West Asian countries such as Kuwait, Iraq and Yemen and later, between 1987 and 1990, he was Consul General in Jeddah. He also held positions in the Indian missions in New York, London and Pretoria. He served as Indian Ambassador to Saudi Arabia (2000-03; 2010-11); Oman (2003-04), and the UAE (2007-10). He was also Additional Secretary for International Cooperation in the Ministry of Petroleum and Natural Gas in 2004-06. In July 2011, the Saudi Government conferred on him the King Abdul Aziz Medal First Class for his contribution to the promotion of Indo – Saudi relations. After retirement from the Foreign Service in 2011, he worked in the corporate sector in Dubai for three years. He is now a full-time academic and holds the Ram Sathe Chair for International Studies, Symbiosis International University. He has published three books: Reform in the Arab World: External Influences and Regional Debates (2005), Children of Abraham at War: the Clash of Messianic Militarisms (2010), and The Islamist Challenge in West Asia: Doctrinal and Political Competitions after the Arab Spring (2013). He writes and lectures frequently on Political Islam, the politics and economics of West Asia and the Indian Ocean and energy security issues.