US, Saudi Arabia play down rift after King Salman pulls out of Obama summit

May 12, 2015

Washington, May 12: The White House and Saudi Arabia scrambled to quell talk of a diplomatic rift on Monday, after King Salman pulled out of a summit with President Barack Obama at the eleventh hour.

Obama summitSenior US and Saudi officials appeared in public to insist the Gulf royal's decision was not a snub nor part of a deeper crisis in never-easy ties that date back decades.

Obama had invited six Gulf leaders to the presidential retreat, amid suspicions that Washington is no longer committed to their security and is not doing enough to stop Iran's destabilizing actions across the region.

Only two leaders, from Qatar and Kuwait, are now slated to attend.

The US president has warned the deeply conservative monarchies that they must reform, and has launched nuclear talks with their arch-foe Iran.

With just days before Wednesday's meeting at the White House and Thursday's gathering at Camp David, Riyadh said it would instead send Crown Prince Mohammed bin Nayef and the king's influential son Mohammed bin Salman.

"This is not related in any way, shape or form to any disagreement between the two countries," said Saudi Foreign Minister Adel al-Jubeir, saying the king would stay at home to deal with unrest in Yemen.

"I think this idea that this is a snub because the king did not attend is really off base. This is an extremely high-level delegation. It has absolutely the right people to represent the kingdom."

Jubeir also dismissed suggestions that King Salman had been forced to cancel the visit due to long-rumored ill health.

"The king's health is excellent, thank God," he said.

The White House, meanwhile, announced that Obama and Salman had spoken by telephone, as the US too tried to downplay differences.

Salman called Obama to "express his regret at not being able to travel to Washington," the White House said.

"The two leaders emphasized the strength of the two countries' partnership, based on their shared interest and commitment to the stability and prosperity of the region."

White House spokesman Josh Earnest rejected claims Riyadh was trying to send a message.

"If so, that message was not received," he said. "The travel plans are completely unrelated to the agenda that's planned for Camp David."

'We see Iran's hand'

Beneath the surface, however, there is deep unease at what US allies perceive as Washington's disengagement from the region under Obama's administration.

There is also worry that a nuclear deal with Iran could unfreeze tens of billions of dollars that Tehran could use to buy weapons or augment support for proxy groups.

"Underlying all of this is how do we confront Iran's interference in the affairs of the countries of the region," said Jubeir.

"We see Iran's hand in Lebanon, in Syria, in Iraq. We see Iran's hand in Yemen.

"We see Iran facilitating terrorist organizations, so the challenge is how do we collectively in the GCC and the US coordinate our efforts."

Some Gulf states had pressed for the summit to lead to a written guarantee that the US would come to their defense, something American officials rebuffed.

"That's something we told them weeks ago was not possible," said National Security Council coordinator for the Middle East, Robert Malley.

"I think whether they were disappointed or not, they got it, they understood that."

Gulf nations had also asked for access to high-tech weapons like the F-35 stealth fighter jet.

But instead, the summit is likely to result in more modest commitments to joint maritime security, a promise to study regional ballistic missile defense and a review to speed up weapons transfers.

The Saudis "felt there was no substance to what had been proposed," said Bruce Riedel, a long-time White House and intelligence operative now with the Brookings Institution.

Lori Plotkin Boghardt, a former CIA analyst now at the Washington Institute for Near East Policy, agreed that "it's hard not to look at this as a snub."

But experts said that in Crown Prince Nayef and Salman's son Deputy Crown Prince Mohammed -- the minister of defense who is seen as a possible ruler and often known as "MbS" -- the two biggest players in Saudi Arabia would be at the summit.

"This is a great opportunity for the Americans to get to know MbS," said Plotkin Boghardt.

Nayef is a "known quantity in Washington but MbS is still a mystery," she added.

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News Network
May 5,2020

Dubai, May 5: A Saudi ministerial decision issued on Monday allows companies in the private sector to reduce salaries by 40 per cent and allows termination of contracts owing to the economic hardships resulting from the COVID-19 pandemic, according to daily newspaper Al Sharq Awsat.

The new decision was still not published by the cabinet according to the newspaper.

The decision which the newspaper saw a copy of was signed by Saudi Ministry of Human Resources and Social Development to regulate the labour contract in the current period, allows employers to reduce the employees salaries by 40 percent of the actual effective wage for a period of 6 months, in proportion to the hours of work and allowing the termination of employee contract after 6 months of the COVID-19 circumstances.

The new decision has also included a provision in which the employer would be allowed to cut wages even he or she benefits from the subsidy provided by the goverment, such as those for helping pay workers wages or exemption from government fees.

The decision also stressed that employers are not allowed to terminate any employee, unless three conditions are met.

1.            First the passing of six months since the measures of salary cut has been taken

2.            Reducing pay, annual leave and exceptional leave were all used

3.            Company proves that its facing financial troubles due to the circumstances.

The memo, which goes into affect as soon as its published in the government’s official newspaper, ensures that the employee will receive his/her salary if on annual leave within the period of 6 months.

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News Network
April 10,2020

Dubai, Apr 10: Saudi Arabia reported 364 new coronavirus cases and three new virus-related deaths, the Ministry of Health announced on Friday.

The total number of confirmed cases in the Kingdom is 3,651, out of which 2,919 are currently active, the ministry added.

Out of the new cases, 90 were recorded in Mecca, 78 in Medina, 69 in Riyadh, and 54 in Jeddah, the ministry said.

Meanwhile, the number of fatalities rose to 47, while th number of recoveries reached 685.

The daily number of confirmed cases in Saudi Arabia has not peaked yet, and has been rapidly accelerating.

Saudi Arabia’s Minister of Health had said earlier this week that four different studies showed that the number of coronavirus cases in the Kingdom could reach between 10,000 to 200,000 within weeks.

The ministry spokesman emphasized the urgent need for citizens and residents to remain at home and maintain social distancing practices to ensure that the virus does not spread further.

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News Network
May 7,2020

Dubai, May 7: Saudi Arabia will emerge as the victor of the oil price war that sent global crude markets into a spin last month, according to two experts in the energy industry.

Jason Bordoff, professor and founding director of the Center for Global Energy policy at New York’s Columbia University, said: “While 2020 will be remembered as a year of carnage for oil nations, at least one will most likely emerge from the pandemic stronger, both economically and geopolitically: Saudi Arabia.”

Writing in the American publication Foreign Policy, Bordoff said that the Kingdom’s finances can weather the storm from lower oil prices as a result of the drastically reduced demand for oil in economies under pandemic lockdowns, and that it will end up with higher oil revenues and a bigger share of the global market once it stabilizes.

Bordoff’s view was reinforced by Sir Mark Moody-Stuart, former chairman of Royal Dutch Shell and one of the longest-standing directors of Saudi Aramco. In an interview with the Gulf Intelligence energy consultancy, he said that low-cost oil producers such as Saudi Arabia would emerge from the pandemic with increased market share.

“Oil is the only commodity where the lowest-cost producers have contained their production and allowed high-cost producers to benefit. When demand recovers this year or next, we will emerge from it with the lowest-cost producers having increased their market share,” Moody-Stuart said.

Bordfoff said that it would take years for the high-cost American shale industry to recover to pre-pandemic levels of output. “Depending on how long oil demand remains depressed, US oil production is projected to decline from its pre-coronavirus peak of around 13 million barrels per day.

“Shale's heady growth in recent years (with production growing by about 1 million to 1.5 million barrels per day each year) also reflected irrational exuberance in financial markets. Many US companies struggling with uneconomical production only managed to stay afloat with infusions of cheap debt. One quarter of US shale oil production may have been uneconomic even before prices crashed,” he said.

Moody-Stuart said that recent statements about cuts to the Saudi Arabian budget as a result of falling oil revenues were “an important step to wean the population of the Kingdom off an entitlement feeling. It means that everybody is joining in it.”

The former Shell boss said that other big oil companies would follow Shell’s recent decision to cut its dividend for the first time in more than 70 years. But he added that Aramco would stick by its commitment to pay $75 billion of dividends this year.

“When a company looks at its forecasts it looks ahead for one year, so for this year it (the dividend) is fine,” he said.

Bordoff added that Saudi Arabia’s action in cutting oil production in response to the pandemic would improve its global position.

“Saudi Arabia has improved its standing in Washington. Following intense pressure from the White House and powerful senators, the Kingdom’s willingness to oblige by cutting production will reverse some of the damage done when it was blamed for the oil crash after it surged production in March,” he said.

“Only a few weeks ago, the outlook for Saudi Arabia seemed bleak. But looking out a few years, it’s difficult to see the Kingdom in anything other than a strengthened position,” Bordoff said.

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