Since the early thirties Saudi Arabia has been a staunch ally of the United States in the Middle East. The U.S.-Saudi strategic relationship has been historically based on two main pillars: energy trade and defense cooperation.
The United States used to be the main importer of Saudi Arabian oil. When OPEC was founded in 1960, with Saudi Arabia as a founding member, the organization exercised a substantial influence on Western countries. In 1973, OPEC imposed an embargo on the U.S., causing an economic crisis that lasted several years, and later induced President Ford to ban oil exports.
Forty years later, as a consequence of the shale revolution, the United States has surpassed Saudi Arabia in oil production, becoming a net energy exporter. Today, the United States imports just a small fraction of its oil from the Middle East.
This shift in energy trade could have significant geopolitical consequences. In fact, Saudi Arabia will need to find new markets to export its principal commodity, which is the country’s main source of income.
China is the world’s largest oil importer. If China replaces the United States as the main oil importer from Saudi Arabia, it would increase its economic influence over the Arab country. However, such influence would be counterbalanced by Japan and India, which import large volumes of oil from Saudi Arabia and are geopolitical competitors of China.
The Suez Canal in Egypt is part of China’s maritime silk road, the planned trade route to connect the Port of Fuzhou with Europe. Since Saudi Arabia is the principal supporter of Abdel el Sisi’s government in Egypt, China has a compelling interest to boost its relationship with Saudi Arabia to preserve its shipping lane to the Mediterranean Sea.
The shift in global energy demand, and the location of the Arab country along an important maritime trade route could transform Saudi Arabia into a geopolitical battleground between the United States and China.
While oil exports could foster Saudi ties with China, it is increasingly clear that the U.S.-Saudi strategic alliance will be mostly based on defense cooperation. Saudi Arabia is restructuring its economy to be less dependent on oil exports, so energy trade will not be the primary link with the United States, but the Saudis will still need American military technology to defend their borders.
Saudi Crown Prince Mohammad bin Salman has embarked on a series of reforms that were long overdue, such as allowing women to drive. After Western countries criticized Saudi Arabia for women’s rights in the past, they should credit the Crown Prince for implementing these reforms.
However, in a conservative country such as Saudi Arabia, reforms are often met with opposite reactions that can cause internal struggles within the ruling family.
The recent dismissal of Rex Tillerson as Secretary of State tipped the scale in favor of Saudi Arabia in the dispute between Qatar and other GCC countries. In fact, Tillerson urged the Saudi-led coalition to ease the sanctions on Qatar, in contrast with the White House.
The domestic reforms, and the renewed assertiveness in foreign policy are clear signs that Saudi Arabia is trying to emerge as a global power. Whether it will succeed, or fall under the influence of other great powers, it shall be seen in the future.
Trump’s meeting with Crown Prince Mohammad in Washington will strengthen the strategic partnership with the U.S.'s main ally in the Arab world.
Francesco Stipo is the President of the Houston Energy Club, a member of the National Press Club in Washington D.C., a Fellow of the World Academy of Art and Science, and recently joined the Bretton Woods Committee. Born in Italy in 1973, Dr. Stipo is a naturalized United States citizen. He holds a Ph.D. in International Law and a Master Degree in Comparative Law from the University of Miami. To read more of his reports, Click Here Now.
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