Iran Versus Saudi Arabia

Posted on Wed 03/09/2016 by

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20090526_Herb_LondonBy Herbert London ~

The trial and subsequent execution of Shiite cleric Nimr al-Nimir a month ago has led to a storm of protest leading to the destruction of the Saudi embassy in Tehran. While Iranian president Hassan Rouhani condemned the attacks as “unjustifiable,” this statement did not mollify Saudi leaders. In fact, the Saudi foreign minister said his nation is severing all diplomatic ties with Iran. Iran’s supreme leader warned that the execution will result in “divine vengeance.”

What these comments and actions mean for the region are not clear. Sheikh al Nimr was a respected activist who preached non-violence and was regarded as a leader among the Shiite minority in Saudi Arabia. Iran’s retaliation may come in multiple forms.

20160307_IRANANDSAUDIARABIAIran could mobilize large scale demonstrations among Shiite majorities in eastern Saudi Arabia, and Bahrain, that call for ethnic unity. It is not coincidental that Saudi Arabian oil fields are located in the same area where the Shia are in the majority. Second, the Iranian Revolutionary Guard could increase its support of Houthi rebels in Yemen, thereby placing pressure on Saudi Arabia’s southern border and undermining a Saudi desire for the restoration of a friendly government in Yemen. Third, the Iranian government could use the revenue from the lifting of sanctions to put further military pressure on Saudi Arabia.

All of these moves – or any of them – could have a destabilizing influence on the Saudi royal family. Iran’s Revolutionary Guard went so far as comparing Saudi Arabia to ISIS. Rhetorical commentary has not been muted on either side. But the action is real. This is the first time the two feuding countries have severed diplomatic ties since 1990.

This is also occurring against a backdrop of political upheaval in Saudi Arabia. Executions and a hard line stance have been on the rise since King Salman came to power. It was reported that 157 residents were beheaded by the Saudi regime in 2015, many for non lethal offenses. Some analysts contend the Salman position is a reflection of internal instability. Clearly competition for leadership of the country is unfolding behind a curtain of secrecy. It is also true that in addition to a fractious Shia minority, there are secular movements emerging and outside political influences, including ISIS supporters, bearing down on the political culture.

Should Saudi Arabia fall, a scenario that is more plausible each day, the implications for world economic affairs are profound. Should Shiites gain control of the Saudi oil fields, a combined Iranian, Iraqi, Russian conglomerate could control seventy percent of the world’s oil supply, thereby spiking oil prices to more than $150 a barrel. Iran would also be in the position of controlling commercial transport of oil through the Gulf of Hormuz and the portals to the Red Sea.

This scenario would also force the hand of the Chinese government, already more inclined to buy Russian rather than Saudi oil, to turn away from Saudi Arabia as an unstable supplier. Similarly, Europeans might be inclined to be even more accommodative to Iranian interests should Saudi instability reveal itself. While the immediate effect would be economic, the long term effect could be political as well.

For Sunni neighbors such as Egypt, the fall of the House of Saud would be catastrophic. Saudi leadership has paid for the arms the Egyptian military needs to fight a war in the Sinai; has been a key ally in the Arab League and has been a military partner in the war against Houthi rebels in Yemen.

For the U.S. – less reliant on Saudi oil than was once the case – the effect is less severe, but nonetheless worrisome. Despite the tilt in American foreign policy to Iran, Saudi Arabia served as a counter-weight to Iranian imperial ambitions. The Saudis produce oil at high levels in order to punish Iranians and Russians dependent on the hard currency high oil prices yield for them. That leverage could be decreasing.

Hence, the execution of a Shiite leader has set in motion a host of cascading events that can be guessed at, but not entirely anticipated. On one matter guess work is unnecessary: the tension between Iran and Saudi Arabia will have an effect on the region and on international politics.

FamilySecurityMatters.org Contributing Editor Herbert London is a Senior Fellow at the Manhattan Institute and the President of the London Center for Policy Research. He is the author of the book The Transformational Decade (University Press of America).

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