The judicial murder on 1 January of the leading Shia cleric, Nimr al-Nimr, by the Saudi monarchy has been roundly condemned by the UN, EU and US as “provocative” and “exacerbating sectarian tensions”. The response in Tehran was, of course, stronger, with attacks on the Saudi embassy and consulates by Shia religious hardliners. At the same time the Ayatollah Khamenei stoked up the tension by calling down “divine vengeance” on the Saudi regime. Since then the world’s media have been filled with numerous items about the “religious” war between Shia Iran and Sunni Saudi Arabia which has now taken on a more dangerous form.

There is a thread of truth to the religious rivalry question (which we will return to below) but it only scratches at the surface of what is really going on. In the intricate imperialist entanglements of the Middle East there are also far more material forces than religion at work. First and foremost is the continuing and deepening global capitalist economic crisis (see editorial article in this issue). When Saudi Arabia, the world’s leading oil exporter was initially quite sanguine about the fall in the oil price in the middle of 2014 it did not expect that the price would dip to around $30 a barrel from its height of $115. They also did not expect the price fall to last so long possibly believing the propaganda emanating from leading financial organisations at the time that “the recession is over”. The signs are that it will last a whole lot longer yet.

At first the Saudi position was, from their point of view, a sensible economic decision. After all, the Saudis had cut production in the past to raise prices only for another producer (often a non-OPEC member like Russia) to simply increase their production and steal market share. In the middle of 2014 the speculation on shale oil in the US was (wrongly) blamed for the majority of the glut in production1. With its high production costs, and inelastic processes which cannot easily be shut down like wells, the shale producers were vulnerable once the price dipped below $80 a barrel. But so too was every other producer and the continuing fall in price has brought economic ruin to Brazil, Venezuela and Russia (which just cut its budget by 10% and forecasted another year of decline). For the Saudis though it will not have gone unnoticed that at the end of 2014 sanctions-restricted Iran was worse off than any of the countries just mentioned. It needed a price of $131 a barrel to balance its budget. This was a further incentive to sit back and let things take their course. Indeed the Saudi oil minister, Ali Al-Naimi said that Saudi Arabia was prepared to tolerate even $20 a barrel. In production terms this make sense as it costs only $10 to produce a barrel of oil in the Kingdom. However that does not mean there are not strains on the regime. Globally the price collapse has not led to production cuts. Indeed the opposite has happened as producers have tried to make up for the fall in price by increasing their output. It is a crude (forgive the pun) illustration of how the tendency for profit rates to fall only increases the overproduction of commodities. Saudi Arabia itself has found it is not immune to problems.

And of course Saudi Arabia’s own budget spending is dependent on the previous high oil price which means it needs $104 a barrel to break even on its current account. The continuing precipitous fall in the oil price over the last eighteen months has now bitten sharply into its massive sovereign wealth reserves to cover the deficit. This in turn has brought new anxieties to the Saud family who have ruled the peninsula since 1935.

A Tale of Two Threats

As an autocratic monarchy ruling with an iron fist holding the largest conventional oil reserves in the world it is often assumed that the regime does not have to worry too much about internal social conflict. Add to that the alliance with the US since 1945 which has made it one of the two pillars of US imperialism in the Middle East (the other, of course, being Israel) and it is generally assumed that the regime is impregnable. But history never stands still and even the most permanent-looking features of any epoch are under strain. Saudi Arabia is no exception and the Saudi family are not unaware of it. The two greatest internal threats perceived by the regime are the Shia minority (about 15% at most of the population) and the jihadist movements which have grown in significance since 1979.

The executions at the start of 2016 were aimed at both of these groups. Of the 47 executed 43 were jihadist followers of Al-Qaeda who had carried out terrorist attacks and the others were Nimr al-Nimr (whose only attacks were verbal) and some other Shia opponents of the regime. They were the first mass execution of political opponents by the regime since 63 “religious extremists” were executed for seizing the Grand Mosque in Mecca in 1979 2. It is a sign of something akin to panic albeit with an element of calculation. Last year an IS/Daesh suicide bomber killed 22 Shia at a mosque in Qatif. The response then was for the Saudi security boss Mohammed bin Nayef to visit the town and declare that “The security services will crack down on those who oppose (the state) whoever they are”.3 Now the execution of these Shia opponents just looks like a sop to the Sunni majority to “balance out” the execution of the Salafist terrorists.

Under the reign of the last King, Abdullah, and his predecessors the regime sought to buy off dissent and discontent with subsidies, sinecures and other social benefits. For example when the “Arab Spring” engulfed the Middle East in 2011 he showered his subjects with a welfare spending programme worth $130 billion. However the expectation that the collapse in the oil price is long-term makes further largesse on this scale impossible. Total oil revenues fell by 15% at the end of the last fiscal year and are expected to fall by 23% this. Furthermore

“Unemployment among citizens in Saudi Arabia is about 12 percent, and a youth boom means millions of new jobs will be needed to keep that from growing. The country also needs to revitalize the private sector beyond the big construction firms that dominate it today and are dependent on oil-fueled government revenues.”4

Desperate times demand desperate measures. It is no accident that after 80 years the regime is now proposing to privatise at least parts of Aramco, the huge state oil producer. It is valued at anywhere between 3 and 30 times the value of the next largest oil company in the world so its listing would have to be in a major financial centre like London or New York. At the same time as subsidies for petrol for private vehicles are being cut, the Saudi stock exchange is being opened up to foreigners as is the retail sector. Finally

_“In a rare move, the government in December said it was setting up a $48.7 billion stimulus package to support projects designated as national priorities because of “excess” volatility in crude oil prices.”_5

By doing this King Salman and his immediate advisors hope to diversify the economy away from oil and the construction industry dependent on oil but most observers don’t think it will go far enough or fast enough to deal with the rising unemployment amongst youth – which already provides a fruitful recruiting ground for the jihadists. The most immediate way that the state tries to deal with this is to finance alternative jihadist groups to IS/Daesh and Al Nusra in Syria (and allow the youth to join them). Without such an outlet they know there will be many more problems on the domestic front.

Middle Eastern Imperialist Rivalry

But it is on the international front that we find another of the shifting factors which may have influenced the Saudi decision to execute al-Nimr. This was the signing of the nuclear deal between Iran and (primarily) the US. When we wrote about the oil issue at the beginning of last year we wrote that:

“The US Congress don’t want to do a nuclear deal with Iran any more than the Iranian hardliners want one”.

But a deal has been done because other interests have over-ridden the opposition in both states. As a result both Congress and the Revolutionary Guards (Pasdaran) have been sidelined by the respective Presidents of Obama and Rohani. The nuclear deal is, in a sense, not the real issue. Obama wants to extricate the US from the appalling situation it got into in Iraq under the Bush regime as well as sort out the Syrian issue before its ramifications spread further (watch Libya and Turkish Kurdistan here). Rohani wants to get the sanctions lifted to carry out economic reforms which are desperately needed to revitalise the moribund Iranian economy. Iran claims that its production costs are no higher than Saudi Arabia’s ($10 a barrel) and therefore the big problem is getting the sanctions lifted and getting more oil on to the world market. The Pasdaran, many of the mullahs and their people actually benefit from the sanctions by controlling the smuggling revenue. The end of sanctions would be a major setback for them. These are the supporters of the Ayatollah Khomeini who engineered the break with the West in 1979 when the US embassy in Tehran was stormed and diplomatic relations were broken off. They also thought they could export their “Islamic Republic” to other areas including Saudi Arabia with its Shia minority. The mullahs did not realise that the Saudi Shia had little interest in their political game or ideology. Their grievances with the Saudi monarchy were more to do with their lack of political and economic freedom. The venomous attacks the Iranian mullahs made on the Saudis were though never forgotten. A year later the CIA incited Iraq’s Saddam Hussein to attack Iran in the hope that this would bring the Islamic Republic down. During the eight years of war that followed Saudi Arabia gave discreet support to Iraq and only turned against it when Saddam seized Kuwait (which he mistakenly thought he had been encouraged to take by the US as a reward for his engagement with Iran).

1979 also saw the Soviet invasion of Afghanistan and with Iran out in the cold the Saudis could indulge in a little imperialist adventuring on their own account. They began by financing the Mujihadeen against the Soviet invaders but at the same time they also exported their own branch of Islam (Wahabbism) by setting up madrassas amongst Afghan refugees with the blessing of the Pakistani dictator Zia Ul-Haq. The students (talib) who emerged from these madrassas became the Taliban and after the withdrawal of the Red Army they eventually took over the country. Saudi support for this “Salafism of the Sheikh” (Saudis don’t like you referring to “Wahabbism” and may even deny it exists) soon spread to Chechenya, Bosnia and almost anywhere there was a Muslim minority. Saudi money stoked the fires of salafism which brought a new intolerance, not only of “infidels” but of other Muslims, into more and more conflicts. It is the 18th century ideology of a preacher, Mohemmed ibn-Abd-al Wahhab, who called on Muslims to kill male non-believers and heretics (especially Shia) and rape their wives and daughters. If this sound uncannily familiar in the practice of the modern day IS/Daesh then it is because they have largely taken it up. And after the fall of Saddam Hussein and the destruction of the Ba’athist state the subsequent Sunni insurgency in Iraq against the Shia dominated regime of Al Maliki was supported by the Saudi regime. Already the visceral hatred for Shia Iran was behind the policy.

“According to a well-placed Arab figure, a senior Saudi official told John Kerry, US secretary of state, while he was talking to Sunni Arab leaders this summer about a coalition against the jihadis: “Isis is our [Sunni] response to your support for the Da’wa” – the Tehran-aligned Shia Islamist ruling party of Iraq.”6

However once it was clear that IS/Daesh had wider ambitions than opposing the Shia in Iraq the Saudis realised that they had unleashed a monster. The proclamation of a Caliphate to once again reunite Muslims was a direct threat to their own domination of the Arab world. Now the race was on to find other Sunni jihadists to support, not just against Assad, but also against IS.

But here we get into the intricate imperialist entanglements of the modern Middle East. Iran, the US and Saudi Arabia now have a common enemy in IS. The possibilities for cooperation should therefore be greater but it is not so simple. For Saudi the whole affair is fraught with danger as Iran is brought in from the cold and playing a key role in Syria and Iraq where it is now in a position to influence events. This could include the survival of the hated Assad regime in Damascus and it could give Iran a bigger platform from which to extend its influence in places like Yemen7 and Lebanon. And Iran’s hopes of increasing oil exports (No Western oil firm is currently involved in Iran but negotiations are reputed to have begun to expand Iranian production) after sanctions are ended are equally worrying for Saudi interests.

Thus the execution of al-Nimr was also a deliberate provocation. The Saudis, seeing the divisions in the Iranian ruling class, hoped that it would lead to do something which might once again isolate it from its new-found grudging ally in the US. And Tehran nearly obliged. When the Saudi Embassy was attacked it must have immediately triggered off a reminder of the attack on the US Embassy in 1979 and the long hostage saga that followed. Iranian hardliners (backed by the Revolutionary Guard) who were behind these attacks were equally ready to undermine the new relationship with the West sought by the Rohani government. Saudi Arabia was not slow to play upon this and just as quick in getting its Sunni allies to not only condemn the attack but to cut off diplomatic relations. However it did not quite have the impact they hoped for. Rohani quickly condemned the attacks on the Saudi embassy and said that the perpetrators would be caught and punished. If the Shia religious fanatics thought they would get the hero treatment of 1979 they must have been sorely disappointed. The Iranian ruling class remains divided but, for now at least, Rohani and his supporters can point to tangible gains both economically and militarily if the Pasdaran and their allies can be restrained. And they have been quick to reassure the Americans that their new alliance is still on course. The value of this was underlined when a boatload of US marines strayed into Iranian territorial waters on January 12. The marines were picked up by the Pasdaran but within 48 hours they were on their way back to the US and John Kerry was boasting about the triumph of the new diplomacy8.

None of this can have been music to Saudi ears and it is perhaps not surprising that they have sought to create their own Sunni Arab coalition consisting mainly of states like Bahrain and Egypt who are financially dependent on Riyadh but has also extended to former rival Arab powers like Qatar which had opposed Saudi policies in Libya and Egypt. Gaining the support of Qatar (after the abdication of its ruler in favour of his son) is a minor consolation for the Saudis. So too perhaps are the states that have stood behind Riyadh whilst it has waged a pitiless bombing campaign in the Yemen to bring a halt to the Houthi rebellion there. But even having to fight a war in Yemen, a Saudi client state for all of its modern existence9 is just one more sign of the current weakness of the regime. It is also a case of a self-fulfilling prophecy. The Houthi rebels are Shia (of a different branch of Shi’ism to the Iranians) but there was little evidence of Iranian material support for the Houthi (who basically looted weapons from the existing Yemeni army). The Saudi attack has simply led to the Houthis setting up tenuous links with Tehran by air (when their air space is completely controlled by the Saudi airforce). This in turn has fed into the Saudi narrative of possible encirclement by a rising Iranian imperialism.

A More Uncertain World

And the Saudis are right to be worried about Iran since the US needs Iranian support in Iraq and (whisper it quietly) Syria since it cannot defeat IS/Daesh or bring the Syrian conflict to an end without such support. The US could turn a blind eye (and even give logistical support) when Saudi salafism was helping to defeat the evil empire of the Soviet Union but as we stated above this has morphed into a generalised anti-western movement amongst the Sunni with affiliates from Indonesia to Mali. And it is as much a threat to the Saudi monarchy as it is to the regimes which rely on the West. As this salafism also distinquishes itself by murdering any it considers to be apostates to their narrow brand of Islam10 then an alliance between the West and Shia Iran makes sense. The Saudi monarchy is caught between a rock and a hard place but playing on fears of Iran is one way of trying to keep the loyalty of its Sunni base. In the middle of a global recession the consequences for them and for the rest of the world are likely to be traced in greater bloodshed.

All of which feeds into a wider picture of a global imperialist “order” in advanced decay. Since the end of the Cold War proxy wars have not ended. But the conflicts which have broken out have also had no resolution. “Peace processes” go nowhere and one war piles up on another. Indeed it is difficult to remember or even hear of them all. Who for example knows of the war in Papua New Guinea between the local indigenous movement and Indonesia? It is just one of many forgotten conflicts which rage across the planet. Behind it all lies the economic crisis of global capitalism which drives the fight for control of the planet’s resources. These local conflicts have not joined up into a third world war largely because the major powers still hope to play them for what they are worth to their own immediate advantage. They are also less desperate to go to war because they are not under so much pressure from the working class at home. As long as the working class is quiet and accepts the various cuts and austerity programmes currently in force then the governing class of the various powers still feels it has some room for manoeuvre.

What is currently more dangerous is not the simmering confrontation between China and the US in the Pacific but the problems faced by lesser but important states like Saudi Arabia. The weaker they become economically the more threatened they feel militarily and the more aggressive their response. The US and Saudi forged an alliance that lasted for decades on the basis of mutual guarantees – regular supply of oil for military and diplomatic protection. In a global economic crisis such certainties no longer prevail and we should expect more barbaric conflicts and the humanitarian disasters that flow from them in 2016.

Jock

January 2016

Footnotes

1 For a detailed examination of how the oil price started to collapse see “Oil and the Shifting Sands of Imperialism” in Revolutionary Perspectives 05 (Winter-Spring 2015) or leftcom.org

2 In 2015 Saudi Arabia executed 152 people and Iran close to 1000, many of these executions taking place in public in both states. Per capita Iran executes more people than any other state in the world and certainly more for simply being political opponents of the regime. The seizure of the Grand Mosque by salafists who called for a return to the “purity” of the past and declared their leader to be the “Mahdi” [chosen one] was a precursor of the shape of things to come. Not only did they reject the Saudi monarchy and its religious right to rule but also denounced the increasing influence of the West. They held the Grand Mosque for two weeks before it was stormed by Saudi troops, an attack which killed their “Mahdi”, Mohammed Abdullah al-Qahtani. His 63 surviving followers were publicly beheaded. King Khaled announced that what Saudi Arabia needed was stricter religious control which meant more power to the religious police and further discrimination against women.

3 See Simeon Kerr “The strong man in a power struggle” Financial Times 9 January 2016

4 See foreignpolicy.com

5 See upi.com* Quoted by David Gardner in “Saudi Arabia, plunging oil prices are a political weapon” Financial Times (Dec 9 2014)

7 For the war in Yemen see leftcom.org . Both sides have been guilty of humanitarian atrocities to match those of Assad in Syria.

8 Although to illustrate the serious split in the Iranian ruling class the propaganda game was played out differently by both factions. Whilst Iranian TV showed the US troops initially handcuffed behind their backs and the Revolutionary Guards were allowed to state that the US had apologised (for which there is no evidence) before releasing them, on Al Jazeera President Rohani’s faction presented images of the troops as honoured guests at a meal before their release. The fact that it came a couple of days before Iranian compliance on part of the nuclear deal was due for verification strengthened the hand of the President here.

9 See article above in footnote 7

10 The Taliban and other organisations in Pakistan for years targeted Christians, Hindus and Shia mosques (particularly in the Quetta area) but have now moved on to other minority branches of Islam like Sufism. Pakistan had almost 25% non-Muslims at its independence in 1947. Today that has fallen to 3%. In Bangla Desh secular bloggers have been butchered in the streets by salafists whilst as we go to press Jakarta and Istanbul have just been bombed.