Gulf states cut ties with Qatar over ‘supporting terrorism’

[angelburst29]

US Ambassador to Qatar Dana Smith has resigned amid a large diplomatic scandal surrounding the country.

'I'll Miss This Great Country': US Ambassador to Qatar Suddenly Resigns
https://sputniknews.com/middleeast/201706131054592134-dana-smith-resigns-qatar-us/

US Ambassador to Qatar Dana Smith abruptly resigned without explanation, according to a Twitter message on Tuesday.

1/2 This month, I end my 3 years as U.S. Ambassador to #Qatar. It has been the greatest honor of my life and I'll miss this great country.

Smith offered no other details about her decision to resign from the post.

The resignation comes amid a dispute in which neighboring nations of Saudi Arabia, Bahrain and the United Arab Emirates have severed diplomatic ties and imposed a naval blockade on Qatar over charges that Qatar supports terrorist organizations such as Hamas.

 

[angelburst29]

Russian President Vladimir Putin and Saudi Arabia's King Salman bin Abdulaziz al-Saud discussed the Qatar crisis in a phone call on Tuesday, days after Riyadh and its allies broke off diplomatic relations with Doha.

Putin, King Salman Discuss Qatar-Arab States Conflict
http://en.farsnews.com/newstext.aspx?nn=13960323001721

The Kremlin announced that Russian President discussed with Saudi King the situation regarding Qatar, which does not promote the consolidation of efforts on Syrian reconciliation and the fight against terrorism.

"Russian President Vladimir Putin and Saudi King Salman bin Abdulaziz al-Saud held a telephone conversation… The heads of states exchanged opinions on the current situation in the Middle East and Northern Africa, touching upon the escalated situation regarding Qatar which unfortunately does not promote the consolidation of joint efforts in the Syrians reconciliation and the fight against the terrorist threat," the statement read.

Bahrain, Saudi Arabia, the United Arab Emirates and Egypt cut off diplomatic ties with Qatar last Monday, and suspended air and sea communication one week after the Arab Islamic American Summit in Riyadh, accusing Doha of supporting terrorist organizations and destabilizing the situation in the Middle East.

Later, Libya, Maldives, Mauritius and Mauritania joined that list of nation to break off diplomatic relations with Doha.

Jordan and Djibouti have also announced that Amman and Djibouti decided to reduce their diplomatic status after studying reasons behind the tension between Cairo, Riyadh, Abu Dhabi and Manama with Qatar.

Qatar regrets the Saudi, Bahraini, the United Arab Emirates' and Egyptian decision to cut diplomatic ties with it.

Saudi whistle-blower Mujtahid, who is believed to be a member of or have a well-connected source in the royal family, disclosed failure of the plot hatched by Saudi Deputy Crown Prince and Defense Minister Mohammad bin Salman against Qatari Emir Sheikh Tamim bin Hamad al-Thani.

Whistle-Blower: Saudi Officials Imprisoned after Opposing Bin Salman's Plot against Al-Thani
http://en.farsnews.com/newstext.aspx?nn=13960323000885

Mujtahid revealed that a number of members of Al ash-Sheikh, Saudi Arabia's leading religious family, including a member of the consultative assembly, were imprisoned in Istiraha by bin Salman to sign a statement against al-Thani.

He added that bin Salman freed them after being disappointed from their endorsement of the statement provided that they avoid releasing the incident through the social media.

Mujtahid said the member of the consultative assembly might be pressured to deny his revelations or the Saudi media might damage his words.

In relevant remarks last Tuesday, Mujtahid disclosed that Mohammad bin Salman and Supreme Commander of UAE's Union Defense Force Khalifa bin Zayed al-Nahyan have slammed the Saudi intelligence ministry for providing wrong intel about Qatar.

According to Mujtahid, the Saudi intelligence ministry had estimated a huge loss for Qatar following a severance by Riyadh and its allies of ties with Doha but the developments showed that Qatar had prepared itself for these days.

"Bin Salman and Bin Zayed had thought that (Qatari Emir) Tamim (bin Hamad Al Thani) will make concessions within 24 hours but the response that they received was challenge and continued release of the emails of the (UAE's) ambassador (to the United States, Yousef al-Otaiba) and other cases," he added.

According to reports, Riyadh and its regional allies had overestimated the negative impacts of closing their airspaces to Qatari planes, underestimating Doha's remaining option to use Iran's airspace by rerouting its flights.

Qatar Airways canceled flights to Bahrain, Egypt and the United Arab Emirates a day after it had suspended flights to Saudi Arabia.

Bahrain, Saudi Arabia, the United Arab Emirates and Egypt cut off diplomatic ties with Qatar last month, and suspended air and sea communication one week after the Arab Islamic American Summit in Riyadh. Later, Libya and the Maldives joined that list of nation that break off diplomatic relations with Doha.

The chief executive of Qatar Airways Akbar Al Baker stressed that the measures taken against Qatari air traffic should be declared illegal.

Qatar Airways Demands Action Against Saudi-Led Boycott
http://en.farsnews.com/newstext.aspx?nn=13960323000752

"We expect our friends to stand up with us in this unfair, illegal blockade conducted by four countries," Al Baker told Al Jazeera.

Baker also called on the International Civil Aviation Organization, a United Nations body, to declare Arab measures against Qatari air traffic illegal.
"We have legal channels to object to this," Al Baker said, adding that "International Civil Aviation Organization ... should heavily get involved, put their weight behind this to declare this an illegal act."

Qatar Airways has cancelled flights to Bahrain, Egypt and the United Arab Emirates from last Tuesday a day after it had suspended flights to Saudi Arabia, after the Arab States closed their airspace to Qatar Airways.

The Qatari port of Hamad began accepting cargo ships from the ports of the Sultanate of Oman instead of the United Arab Emirates (UAE), after Dubai cut diplomatic relations with Doha a week ago and banned Qatari vessels from entering its ports.

Qatar Begins Accepting Cargo Ships from Oman Instead of UAE Amid Diplomatic Row
http://en.farsnews.com/newstext.aspx?nn=13960323000395

According to the Ajel media outlet, a cargo ship from the Omani port of Sohar left for Qatar on Monday. The Omani port of Salalah is also being used for these purposes.

Previously, large cargo ships visited the UAE deep port of Jebel Ali, where cargoes were reloaded onto smaller ships before being delivered to the Qatari port, which is not capable of receiving large vessels.

The Saudi foreign minister assured US Secretary of State Rex Tillerson that Qatar was not blockaded.

Saudi FM Assures Tillerson No Qatar Blockade Exists, Says Food Shipments Allowed
https://sputniknews.com/middleeast/201706131054595593-saudi-arabia-qatar-blockade-food-tillerson/

Qatar has not been blockaded and Saudi Arabia is prepared to allow shipments of food and medical supplies as needed, Saudi Foreign Minister Adel al-Jubeir said on Tuesday during the meeting with US Secretary of State Rex Tillerson.

There is — there is no blockade of Qatar," al-Jubeir said. "Qatar is free to go — the ports are open, the airports are open."

Kuwait’s emir warned that the dispute between Qatar and several other Persian Gulf states could lead to "undesirable consequences."

Kuwait: Qatar Dispute May Have Undesirable Consequences
http://en.farsnews.com/newstext.aspx?nn=13960323000307

"It is difficult for us, the generation that built the (Persian) Gulf Cooperation Council 37 years ago, to see these disagreements between its members which may lead to undesirable consequences," Sheikh Sabah al-Ahmad Al Sabah said, presstv reported.

Since early June, Kuwait has been playing the role of mediator between Qatar and Saudi Arabia, Bahrain, Egypt and the United Arab Emirates who broke off relations with Doha and suspended all land, air and sea traffic with the monarchy. In their apparent bid to secure US support and that of Israel, the four countries cited Qatar's links with Hamas and accused it of supporting terrorism.

"I personally lived through the first building blocks of this council nearly four decades ago, so it is not easy for someone like me as a leader to stand silent without doing everything I can to bring brothers back together," he added.

Last week, Kuwait’s emir traveled to Qatar after his visits to Saudi Arabia and the United Arab Emirates (UAE) as part of his efforts to help mediate a solution to the diplomatic row among Arab countries.

Meanwhile, Qatar's Foreign Minister Sheikh Mohammed bin Abdulrahman Al Thani censured the sanctions recently imposed against Doha by Riyadh and its allies as "unfair" and "illegal."

"Whatever relates to our foreign affairs... no one has the right to discuss," he said during a trip to Paris. He also called for "dialogue based on clear foundations" in relation to claims that his country supports terrorism. "Qatar is willing to sit and negotiate about whatever is related to Persian Gulf security," he added.

Foreign Minister Sheikh Mohammed bin Abdulrahman al Thani said Qatar was willing to "negotiate" on the security matters of the region, but would maintain an independent foreign policy.

Qatar Says No Compromise on "Independent" Foreign Policy
http://en.farsnews.com/newstext.aspx?nn=13960323000423

Qatar's Foreign Minister Sheikh Mohammed bin Abdulrahman al Thani told a news conference in France that he "still had no clue" why fellow (Persian) Gulf states cut ties with Doha, TRT reported.

"It's not about Iran or Al Jazeera," Sheikh Mohammed told reporters in Paris after meeting his French counterpart.

"We have no clue about the real reasons."

[...] "Whatever is related to the collective security of the (Persian) Gulf countries, Qatar is ready to negotiate but we have the right to react to these accusations that we are interfering in their internal affairs.

"Our foreign policy is subject to the sovereignty of our country and is based on our own assessment and our own principles."

The foreign minister welcomed moves by Kuwait to act as a mediator in the dispute "with the help of friendly countries such as the United States."

A senior Saudi commander of the Al-Nusra Front (also known as Fatah al-Sham Front or the Levant Liberation Board) was gunned down by unknown attackers in Western Damascus on Monday.

Saudi Commander of Terrorists Killed by Unknown Gunmen in Western Damascus
http://en.farsnews.com/newstext.aspx?nn=13960322000883

Local sources said that Abu al-Ma'amoun, a Saudi field commander of the Al-Nusra in Moqr al-Mir region was killed by the gun fire of unknown attackers.

The sources added that the Syrian Air Force bombed Al-Nusra Front's position in the region simultaneous with the attack on the terrorist group's commander.

A senior counter-terrorism adviser to Qatar's Foreign Minister disclosed that Doha hosted the Taliban militant group based on a request from the United States whose president, along with a number of Arab regimes, has been pressuring Doha over what they say is its support for terrorist groups.

Qatari Official: Doha Hosted Taliban at Washington Request
http://en.farsnews.com/newstext.aspx?nn=13960322001211

Mutlaq al-Qahtani told Al Jazeera that Qatar hosted the Taliban “at the request of the US government” and as part of Qatar’s “open-door policy, to facilitate talks, to mediate and to bring peace.”

It was "absolutely a request by the US government", senior advisor said, adding that "we were facilitating the talks between the Americans, the Taliban and the government of Afghanistan, because this is our foreign policy: to facilitate talks, to mediate and to bring peace."

The Taliban opened a “political office” in Qatar in 2013, but the Qatari government later shut it down. However, Taliban leaders are still said to be in Doha.

The overthrow of Qatar’s royal family and, possibly, even the elimination of Qatar's statehood through its annexation to Saudi Arabia could be the endgame for Saudi Arabia in the recent Arab states' diplomatic row with Qatar, experts told Sputnik.

Overthrowing Qatar's Royal Family May Be Doha-Riyadh Diplomatic Row Endgame
https://sputniknews.com/analysis/201706081054441990-qatar-diplomatic-row-endgame/

Even though the United States declared its neutrality, it is hard to believe that the developments of the recent days were not approved by Washington. I am not 100 percent sure what the main goal is. However, I think that it may be aimed, at a minimum, at changing Qatar's policy or overthrowing the royal family. As an extreme option, it could be aimed at the elimination of Qatar as an independent state and its annexation to Saudi Arabia," Yakov Kedmi, a retired high-ranking Israeli intelligence official, said.

Saudi Arabia has introduced a new tax on cigarettes and energy drinks that has led to a 100-percent price hike, as the kingdom continues to struggle with sunken oil prices.

Riyadh Doubles Price of Cigarettes to Recoup Lost Oil Cash
https://sputniknews.com/business/201706131054567508-riyadh-tobacco-tax/

The newly introduced tax has cranked up prices on cigarettes and energy drinks across Saudi Arabia, according to various media reports. Prices for carbonated drinks have been increased by 50 percent as well.

The introduction of what has been dubbed a "sin tax" is officially meant to discourage consumption of harmful products that are likely to cause health problems, and will eventually increase medical expenses that are paid in part by the government, according to the official website of the country's General Authority of Zakat and Tax (GAZT).

"We've communicated with the business sector and have set up many workshops to introduce the selective tax both at the GAZT and the Chamber of Commerce," GAZT spokesperson told Arab News.

Under the new regulations, a pack of cigarettes costs between $4 and $6. Days before the introduction of the tax, smokers tried to buy up as many packs as they could, while shops did all they could to hide the merchandise from customers until after the new regulations came into effect.

As for energy drinks, they are now being sold with a warning, written both in Arabic and English, that reads, "This product does not have any health benefits. Consuming more than two cans a day may negatively affect your health."

According to Arab News, the warning is primarily aimed at people below the age of 16, pregnant and breastfeeding women, people with heart conditions and other high-risk groups.

"Raising the price of energy drinks is a good thing, because most of those who consume them are youngsters and that affects their health," UAE news website The National quoted customer Al Rashid saying.

According to the National, the introduction of the "sin tax" comes in accordance with an agreement of the Gulf Cooperation Council (GCC) and IMF recommendations. GCC states also intend to adopt a value-added tax of 5 percent on certain goods in 2018.

Saudi Arabia is currently striving to make ends meet, thanks to a budget deficit of $100 billion in 2015 caused by a massive drop in oil prices. Riyadh funnels a significant portion of the much-needed money to fund a war against Houthi rebels in Yemen, a campaign that has already taken lives of more than 12,000 people, according to Basirat news website's estimations.

 

[angelburst29]

The United States should consider moving its air base out of Qatar, the Emirati ambassador to the U.S. said Tuesday, encouraging the Trump administration to use its leverage to further pressure Qatar over alleged support for extremism.

Emirati ambassador: US should rethink its air base in Qatar
http://www.militarytimes.com/articles/emirati-ambassador-us-should-rethink-its-air-base-in-qatar

As the Persian Gulf crisis enters its second week, Ambassador Yousef al-Otaiba of the United Arab Emirates said Qatar's neighbors would "fairly soon" give the U.S. a list of specific actions Qatar must take before punitive steps are lifted. He said the list would likely include Qatari sanctions on bank accounts of individuals that Qatar's neighbors have already sanctioned and possibly on the banks themselves. "We've gotten fed up. We've had enough," Otaiba said.

In their bid to isolate Qatar by cutting off diplomatic ties, the UAE, Saudi Arabia and other Arab countries have been emboldened by President Donald Trump, who has forcefully echoed their accusations that Qatar funds terrorist groups and foments instability in the Mideast. UAE Ambassador Yousef al-Otaiba said both his country and the U.S. had allowed "bad behavior" by Qatar to continue for "a very long time."

"If I want to be honest, I think the reason action hasn't been taken against Qatar is because of the air base," Otaiba said, referring to al-Udeid air base, not far from Doha. "The air base is a very nice insurance policy against any additional pressure."

Home to some 10,000 U.S. troops, the base has emerged as a flashpoint in the dispute between Qatar and its neighbors, the worst in the Persian Gulf in years. The forward headquarters of the U.S. military's Central Command is a staging point for U.S. air campaigns in Iraq, Afghanistan and Syria.

"Maybe someone in Congress should have a hearing and just say, you know, 'Should we consider moving it?'" Otaiba said. "And maybe not moving the entire base. Maybe just distribute to various countries so you don't have all your eggs in one basket."

Otaiba told reporters that the UAE hasn't told the U.S. it should consider moving the base, but is "willing to have that conversation." And he suggested American troops could be moved to his country, instead. Pointing to new defense cooperation deal the U.S. and the UAE signed last month, Otaiba said the "infrastructure is in place" to have the conversation if the U.S. wanted to relocate.

The U.S. already has some troops in the UAE. The Pentagon has said the new document "provides the U.S. military with the ability to more seamlessly respond to a range of scenarios in and around the UAE, if necessary."

Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut diplomatic ties with Qatar last week, accusing it of backing terrorism and promoting policies that destabilize the region. Qatar denies those allegations. Trump has offered Secretary of State Rex Tillerson to help mediate a resolution, but other countries including Kuwait have also gotten involved.

Otaiba said the forthcoming list of demands would center on three complaints about Qatari behavior: support for terrorism, meddling in others' internal affairs, and use of state-backed media to attack neighbors.

He said the list would likely include expelling terrorists from Qatar and shutting down or curtailing Qatar-funded media outlets that attack UAE and others. He said al-Jazeera, the Qatari-backed television network that has drawn particular consternation from Qatar's neighbors, would likely be on the list of issues Qatar address would have to address.

The Emirati diplomat said his country was hearing only support from the White House on its move against Qatar, despite Tillerson's call for the UAE and the others to ease the steps they took to isolate Qatar. "That's not going to happen," Otaiba said.

Still, he said he did not foresee the crisis becoming a military conflict, even if Qatar refused to bow to demands. Even if Qatar does accept the list of demands, Otaiba said they'd have to fulfill specific steps over a period of time to show seriousness before the countries would restore ties to the tiny, gas-rich country. "There will be an escalation of economic pressure" unless Qatar changes course, Otaiba said.

 

[angelburst29]

The US Air Force Surgeon General announced on Monday that as as many as 135 people may have been infected with bloodborne diseases, including the HIV virus, from unclean medical tools at an air base clinic in Qatar.

Dozens Exposed to Deadly Disease at Qatar Base Used by US Air Force
https://sputniknews.com/military/201706211054821104-dozens-exposed-to-deadly-disease/

Some 135 people may have been infected with HIV, Hepatitis A, and Hepatitis B over the course of the past ten years, according to the Air Force medical chief, after clinic implements were improperly sterilized.

Endoscopes, used in gastrointestinal surgery and other procedures, wielded by Air Force Medical Service staff at the US Al Udeid Air Base in Qatar, were, according to the Air Force Times, "cleaned in a manner inconsistent with sterilization guidelines," according to the Air Force medical chief.

According to reports, some 135 patients at the air base medical facility underwent procedures requiring the use of the improperly cleaned medical devices
between April 2008 and April 2016.

Applying quick public relations damage control, a spokesperson for the Air Force claimed that a risk of an infection is "very small, particularly in a deployed environment," due to the requirement of all Air Force service members to test negative for HIV prior to being sent to foreign lands.

An apology for the embarrassing and potentially deadly oversight was offered by the top Air Force doctor.

"Providing quality healthcare to our airmen and their families is our top priority," the chief said in a statement. "We apologize to our patients and assure them that appropriate actions have been taken to address and mitigate the causes that led to this problem," cited by the Air Force Times.

The Air Force announcement included a statement asserting that the the Al Udeid air base clinic no longer performs surgical procedures requiring endoscopes, including endoscopies and colonoscopies.

"Our patients put their trust in us when they step into any of our medical facilities," the Air Force Surgeon General's statement declared.

"We take potential risk to patient safety very seriously and are committed to informing those under our care of any increased risk," the statement added.

According to reports, the Air Force Medical Service is tracking down those thought to be potentially be at risk of infection and speedily reviewing sterilization procedures.

The leaders of Egypt and the United Arab Emirates agreed on Monday on the need to join forces in fight against terror funding as the tensions in the Persian Gulf region remain high.

Egypt, UAE Agree on Need for Joint War on Terror Amid Row With Qatar
https://sputniknews.com/middleeast/201706201054783173-egypt-uae-terror-fight-qatar/

Abu Dhabi Crown Prince Mohammed Al Nahyan and Egyptian President Abdel Fattah Sisi confirmed Monday the need for a joint fight against terror funding amid the diplomatic rift with Qatar over respective allegations, Sisi’s office said in a statement.

"The sides confirmed the importance of the necessity to join efforts of all Arab states and the international community in the fight against terrorism at all levels, particularly [with regard to] halting terror groups’ funding and providing them with political and information support," the statement said in the follow-up to the talks between Sisi and Al Nahyan, who arrived in Cairo earlier in the day.

 

[Ca.]

Amid Cash Crunch, Qatar Sovereign Wealth Fund May Start Liquidating Stock Holdings
Tyler Durden Jun 21, 2017 5:30 PM
_http://www.zerohedge.com/news/2017-06-21/amid-cash-crunch-qatar-sovereign-wealth-fund-may-start-liquidating-stock-holdings
Link for associated Links and charts:

Since we first highlighted the cash-crunch in Qatar over a week ago, the situation has got notably worse (as liquidity costs rise further, signalling Qatar's financial system is running out of dollars).

The good news for Qatar - the world's wealthiest nation on a GDP/capita basis - is that it has enough financial firepower to withstand a prolonged financial siege, and defend its currency and economy, Finance Minister Ali Shareef Al Emadi told CNBC in an interview broadcast last Monday.

However, we warned then that "while so far there has been no suggestion that Qatar would commence liquidating its reserves, investors have already begun selling Qatari assets and speculating against the riyal, concerned how long Qatar can weather the crisis without having to devalue its currency or sell any of its global holdings."

And as Reuters now reports, that appears to be starting a, according to people familiar with the matter, Qatar's sovereign wealth fund has transferred over $30 billion worth of its domestic equity holdings to the finance ministry and may sell other assets as part of a restructuring drive.

Stakes in 18 companies were transferred earlier this year, before Qatar's diplomatic rift with other Gulf states. The stakes include major holdings in some of the country's top firms such as Qatar National Bank, telecommunications operator Ooredoo, and Qatar Electricity & Water Co.

"The assets were transferred so that the Ministry of Finance could oversee these holdings in a more active manner," one of the sources said.

He added, "Under the rule of Sheikh Tamim, Qatar is moving into an era of greater government scrutiny and oversight of funds. The finance ministry has a hands-on approach to public investments."

"It has not been decided yet how the revenue from the company dividends will be used. They could form an additional revenue stream for the government, or the finance ministry holdings could be prepared for privatizations or strategic sales," the first source said.

The holdings transferred to the finance ministry include stakes across the country's banking industry: Islamic lender Masraf al Rayan, Ahli Bank, Qatar Islamic Bank, Qatar International Islamic Bank, Doha Bank, Commercial Bank of Qatar and Al Khalij Commercial Bank.

They also include industrial, trading and transport firms: Qatar National Cement, Al Meera Consumer Goods, Qatar Gas Transport, Gulf International Services, Mannai Corp, Mayaza Qatar Real Estate, Qatar Industrial Manufacturing Co and Qatar Oman Investment Co.

And judging by the last 2 days of aggressive selling, investors are confidently front-running the liquidation of some or all of these domestic holdings...

This move, if it happens, is reminiscent of 2015's massive liquidations by global reserve managers which had two possible explanations, the first being that foreigners are unloading US paper (ostensibly to domestic accounts) ahead of what they perceive a trajectory of Fed rate hikes which could pressure prices lower; or more likely, the ongoing surge in the dollar and collapse in commodity prices continues to pressures foreign reserve managers to liquidate US Treasury holdings as they scramble to satisfy surging dollar demand domestically and unable to obtain this much needed USD-denominated funding, are selling what US assets they have.

Which of course, if it were to continue too long or too hard, could well force The Fed back on to the sidelines (especially as it expects to begin quantiative tightening of its balance sheet again as soon as September).

Notably that seems to be reflected in Riyal forwards which, after a brief respite, have spiked to record lows once again, front-running the capital flight

Oil Markets Unmoved By Brewing Conflict In The Middle East
Oilprice.com _http://oilprice.com/Energy/Energy-General/Oil-Markets-Unmoved-By-Brewing-Conflict-In-The-Middle-East.html
By Nick Cunningham - Jun 19, 2017, 6:00 PM CDT
Links Within:

The political standoff in the Middle East between Qatar and other powers in the Middle East enters its third week, and the conflict shows no signs of abating.

On June 5, Saudi Arabia, Egypt, the UAE and Bahrain cut diplomatic ties with Qatar and also tried to close off entry to Qatar by land, sea and air. They argued that Qatar is a major funder of terrorism.

U.S. President Donald Trump backed the move. “The nation of Qatar, unfortunately, has historically been a funder of terrorism at a very high level, and in the wake of that conference, nations came together and spoke to me about confronting Qatar over its behavior,” Trump said on June 9. “I decided, along with Secretary of State Rex Tillerson, our great generals and military people, the time had come to call on Qatar to end its funding -- they have to end that funding -- and its extremist ideology in terms of funding.”

Of course, there is much more to the spat than Qatar’s terrorism links – the tension between Qatar and Saudi Arabia goes much deeper. Qatar supported the Arab Spring uprisings in 2011, sparking the intense ire of the various monarchies and authoritarians in the region. Qatar has a friendly relationship with Iran, a major rival of Saudi Arabia. There is also just a plain old competition for power in the region. Needless to say, it’s complex.

Tensions are heating up. In a show of force, Qatar held military exercises on June 19 with Turkish troops.

As is often the case with the Trump administration, there have been mixed signals from Washington. President Trump has strongly supported the isolation of Qatar over its alleged funding of terrorism, ignoring the fact that although the relationship is complicated, Qatar is an ally of the U.S. in many ways. Not only does the U.S. have a large military base in Qatar, Qatar is also home to the U.S.’ regional Central Command headquarters. The location is critical to the U.S.’ campaign to fight ISIS, among other security objectives. Moreover, the Pentagon just signed off on a $12 billion weapons deal to Qatar last week. Shortly after Trump’s public comments, the Pentagon felt the need to issue a statement thanking Qatar for hosting 10,000 U.S. troops.

The U.S. has friends and military assets on both sides of this fight, which likely means that Washington will try to ratchet down tensions, despite President Trump’s comments. Recognizing the gravity of the situation, U.S. Secretary of State Rex Tillerson cancelled a planned trip to Mexico in order to try to deal with the conflict.

For now, the struggle has not yet led to a major disruption in the flow of oil and gas. Qatar Petroleum said in recent days that it would not cut off natural gas exports to the UAE, despite having the legal option of doing so. "The siege we have today is a force majeure and we could close the gas pipeline to the UAE," Qatar Petroleum’s CEO said on Al Jazeera on June 18. "But if we cut the gas, it does great harm to the UAE and the people of the UAE, who are considered like brothers ... we decided not to cut the gas now," he told the Doha-based channel in an interview aired on Sunday.

But regional experts do not see this conflict going away anytime soon. A protracted battle raises the chances of escalation into tit-for-tat reprisals that ultimately lead to some sort of supply disruption. Qatar is the largest LNG exporter in the world and is also a non-trivial oil producer and a key member of OPEC. Qatar recently rerouted some LNG tankers away from Egypt’s Suez Canal.

A broader regional conflict would have huge implications for oil prices, although whether positive or negative remains to be seen. The bullish case is more obvious: any supply disruption would push up oil prices, and the effect on LNG markets would likely be even greater. An outright hot war between multiple Middle Eastern countries – for now a remote possibility – would be catastrophic. "If the conflict develops into a military confrontation ... I would expect a very large spike in prices to around $150 a barrel of oil," Jean-Francois Seznec of the US-based Atlantic Council's Global Energy Center, told Al-Jazeera.

The bearish case is more counter-intuitive, although quite obvious once you think about it. A regional conflict, particularly if tensions between Saudi Arabia and Iran pick up, could lead to the breakdown of cooperation within OPEC. That is, everyone starts producing as much as possible again. That would be decidedly negative for oil prices.

Still, it is hard to imagine a Saudi military incursion into Qatar without the consent of Washington, which makes U.S. policy crucial. News that Sec. of State Tillerson is prioritizing de-escalation is a positive sign that things won’t spin out of control.

Perhaps that is why the oil markets have thus far responded with a shrug to the brewing conflict in the Middle East.

Doha says it won't negotiate until boycott ends

http://<iframe width="560" height="...=1" frameborder="0" allowfullscreen></iframe>

 

[angelburst29]

Good article, C.a.

..... are selling what US assets they have. Looks like there were a few things the Saudi's and the rest of the gang hadn't anticipated in their quest to isolate Qatar?

Ankara's decision to send a group of Turkish servicemen to a Qatari base is the wrong move because it was not caused by a real threat to Turkey's security and does not reflect the country's national interests, Turkish political analyst Murat Bilhan told Sputnik.

Why Turkey's Deployment of Troops to Qatar Could Prove to Be the 'Wrong Step'
https://sputniknews.com/middleeast/201706211054847085-turkey-qatar-troops-deployment-region/

Late last week, the first batch of Turkish troops arrived in Qatar for a joint military drill, according to the Qatari Defense Ministry.

The deployment came after Turkey and Qatar signed a joint defense agreement which specifically stipulates Ankara setting up a military base in this Gulf country.

Commenting on the issue, Murat Bilhan said that he is, "in principle, against the Turkish military being deployed in Qatar, just like it was earlier the case with Lebanon."

"After all, the deployment of our military there is only permissible if we receive very significant benefits or set the goal of destroying a threat to our national interests," he said.

The purpose of sending the [Turkish] military [to other country] is of importance. The military can conduct cross-border exercises, if their main task is to ensure the security of their country. They can even launch strikes at terrorist elements that pose a threat to Turkey's security. However, in the case of Qatar, personally I cannot understand what specific benefits Turkey can make," Bilhan added.

I don't know if this development will affect relations between Qatar and the Saudi's?

Saudi Power Struggle Ends With King Promoting His Son to Be Heir
https://sputniknews.com/middleeast/201706211054833598-saudi-arabia-heir-change/

 

[Ocean]

Qatari businessmen hail positive outcomes of recent visit to Oman
http://www.thepeninsulaqatar.com/article/23/06/2017/Qatari-businessmen-hail-positive-outcomes-of-recent-visit-to-Oman

A number of businessmen and members of the Qatari delegation yesterday praised the positive outcomes of the visit organised by Qatar Chamber of Commerce and Industry (QCCI) to Oman, which saw the signing of several agreements between the countries to supply foodstuffs and other commodities to the Qatari market over the long term, along with understandings to establish trade and investment partnerships between the two sides.

The visit was a success, according to QCCI press statement, that quoted Sheikh Nawaf bin Mohammed bin Jabor Al Thani, member of Qatar Chamber's Board of Directors saying so. The Qatari delegation, which included more than 140 Qatari businessmen, met with Omani counterparts and discussed the best mechanisms to increase the volume of cooperation between the private sector in the two countries.

Qatar Primary Materials Company's (QPMC) Chief Executive Officer Issa Al Hammadi stressed that supply contracts have been signed between Qatari businessmen and a number of quarry owners in Oman to supply gabbro to the Qatari market. The first vessel loaded with the first shipment of gabbro will arrive in Qatar today. Six other ships will follow, he added.

CEO of Mwani Qatar Captain Abdullah Al Khonji said that the deals and agreements signed during the visit will enhance trade exchange between the two countries during the coming period.
Sheikh Nawaf bin Nasser Al Thani, a businessman, said that relations between Qatar and the visit had provided Qatari traders with the opportunity to discover various Omani companies and products showcased at an exhibition as part of the visit.

Member of Qatar Chamber's Board of Directors and businessman Rashid bin Hamad Al Athba said the visit has enabled Qatari businessmen to learn about the investment and business climate in the Oman, pointing out that it was aimed at finding alternatives to import foodstuffs, building materials, raw materials and others.

 

[Aeneas]

Perhaps Saudi Arabia would like this to finish sooner rather than later. The first 24 hour ultimatum passed weeks ago and only exposed Saudi Arabia as being weak and bullying without any real power other than bluster.

Now they have issued another ultimatum, this time 10 days, so to avoid have egg on their faces as soon as last time

https://www.sott.net/article/354466-Report-Saudi-Arabia-and-allies-demand-Qatar-close-Turkish-base-shut-Al-Jazeera-and-more-within-10-days

Report: Saudi Arabia and allies demand Qatar close Turkish base, shut Al Jazeera and more within 10 days
The Arab states which have imposed an economic blockade on Qatar over its alleged financing of terrorism have issued a severe list of demands, which includes giving Doha 10 days to cut ties with Iran, shutting down Al Jazeera, closing a Turkish military base and paying a fine.

The Kuwait emissary, which is serving as mediator in the diplomatic standoff, has reportedly presented the list of 13 demands from the Arab states to Qatar. Doha has 10 days to comply, according to Associated Press which has seen the list.

The ultimatum demands that Qatar abandon its cooperation with Iran, close down its military base where Turkish troops stationed and disbands its Al Jazeera news network.

The countries led by Saudi Arabia also demands Doha to cut all ties with terrorist organizations, including the Muslim Brotherhood, Islamic State (IS, formerly ISIS/ISIL) and Al-Qaeda. The list also demands that the monarchy stop funding all extremist groups designated as "terrorist" by the US.

The Gulf nations are also seeking detailed information about "opposition figures that Qatar has funded," AP said. In addition, Qatar must surrender all nationals who are wanted on terrorism charges by Saudi Arabia, United Arab Emirates, Bahrain and Egypt.

Saudi Arabia, UAE, Bahrain and Egypt severed relations with Qatar in early June, accusing their neighbor of sponsoring terrorism. Some other countries outside the Gulf region also downscaled ties and partially joined in imposing economic sanctions on Qatar.

Before Kuwait delivered the ultimatum, US Secretary of State Rex Tillerson cautioned that demands against Qatar need to be "reasonable and actionable."

"We support the Kuwaiti mediation effort and look forward to this matter moving toward a resolution," Tillerson said Wednesday.

This is the Kuwait emissary's second mission aimed at restoring diplomatic ties between Qatar and the Gulf Cooperation Council (GCC) nations.

During the previous attempt, Doha rejected the laid out preconditions, with Sheikh Abdulrahman Al-Thani who serves as the Qatari foreign minister, stating emphatically that no outside power can interfere with Doha's foreign policy or dictate its media politics. The Sheikh also made clear that Qatar could survive "forever" under sanctions.

The ongoing crisis was triggered in early June following a report on the state run Qatar News Agency (QNA) website, in which the country's Emir, Tamim bin Hamad Al Thani, criticizes Saudi Arabia's anti-Iranian rhetoric among other controversial statements. QNA immediately retracted what it termed "fake news," and following an investigation said the channel had been hacked by "neighboring" states which then used the QNA report as a pretext to impose the economic blockade.

As the crisis developed, Doha found itself increasingly isolated and dependent on aid from Turkey and now Iran. Both countries have sent food supplies to Doha, currently under a tough trade and travel blockade. Meanwhile, Ankara fast-tracked the ratification of an earlier sealed deal to send troops to the Gulf nation to train Qatar's police force.

With no resolution to the stalemate imminent, Washington has questioned the motives behind the punitive measures imposed on Qatar.

"Were the actions really about their concerns regarding Qatar's alleged support for terrorism, or were they about the long-simmering grievances between and among the GCC [Gulf Cooperation Council] countries?" State Department spokeswoman Heather Nauert asked Tuesday.

Since the start of the ongoing rift, Qatar has insisted that its innocent.

"Our government has maintained, from Day 1, that the blockade has nothing to do with the accusations that have been leveled against Qatar," Meshal bin Hamad Al-Thani, Qatar's ambassador to the United States wrote in a Washington Post op-ed Thursday.

"The allegations that Qatar supports terrorism and that Qatar is a secret ally of Iran are, as the State Department suspects, just a smokescreen for an attempt to infringe upon Qatar's sovereignty and punish Qatar for its independence," the ambassador wrote.

He called for negotiations to end the crisis, but accused the belligerent states of "seeking to drive a wedge between Qatar and the United States for their own political gain."

"Qatar has the right to chart its own course, without the interference of other nations, and that is what we can and will do. The door to the negotiating table will stay open," Al-Thani emphasized.

The envoy said the Saudi-led nations know all too well that Qataris "do not, have not and never will support terrorism," and accused Doha's detractors of orchestrating a "smear campaign" when it comes to accusations that Qatar is a "secret ally" of Iran. He added that Doha is providing support to Syrian rebels who are battling against the Syrian government and Iranian troops.

"The Saudis, the UAE and every government in the Gulf maintain diplomatic and trade relations with Iran," the ambassador pointed out. "In fact, Iran's biggest trading partner is the nation now leading the anti-Qatar blockade, the UAE."

Turkey has responded immediately and are not about to close their military base in Qatar as demanded by Saudi Arabia:
https://www.sott.net/article/354475-Turkey-has-no-intention-of-closing-Qatar-base-despite-Saudi-Arabia-ultimatum

Turkey has no intention of closing Qatar base despite Saudi Arabia ultimatum


RT
Fri, 23 Jun 2017 13:18 UTC

Turkey has no intention of shutting down its brand new military base in Qatar, it said in a rejection of a demand about the small Gulf kingdom voiced by other Arab nations. Ankara says the base benefits the entire Gulf region.

Closing the Turkish base is reportedly one of 13 moves expected from Doha by a group of countries led by Saudi Arabia and Egypt, which last month declared a transport blockade of Qatar and downgraded diplomatic relations with it.

"If there is such a demand, it will mean interference in bilateral ties," Turkish Defense Minister Fikri Isik told the local broadcaster NTV.

On Thursday, five armored vehicles and 23 troops arrived in Qatar from Turkey as part of the military cooperation between the two countries. There are already 88 Turkish soldiers stationed in Qatar, and that number is expected to eventually reach 1,000, according to Turkish newspaper Hurriyet. The agreement to host a Turkish base in Qatar was signed in 2014.

"The strengthening of the Turkish base would be a positive step in terms of the Gulf's security," Isik said. "Re-evaluating the base agreement with Qatar is not on our agenda."

The minister added that the base in Qatar benefits the security of the entire region. He added the Arab nations opposing Qatar didn't send a demand to shut down the base to Turkey directly.

The rift among the Gulf nations is the latest iteration in a long-standing conflict over a number of issues, including Qatar's support of the pan-Arab network Muslim Brotherhood, its economic ties with Iran and the influence it has in the Arab world thanks to its state-sponsored news channel Al Jazeera.

Saudi Arabia and its allies perceive the Muslim Brotherhood as a terrorist organization, Iran as an enemy and Al Jazeera as an instrument of Qatari interference with their domestic affairs.

Turkey, which voiced support of Doha amid the antagonism, has tripled its exports to Qatar since the transport blockade was announced, Turkey's Customs and Trade Minister Bulent Tufenkci said Thursday. Qatar's only land routes go through Saudi Arabia, so it now relies solely on sea and air supplies.

Iran has also been quick to use the rift in the GCC to strenghten ties with Qatar and is exporting lots of food to Qatar:

https://www.sott.net/article/354456-Blockade-busting-Iran-supplies-1000-tons-of-food-to-Qatar-every-day

Blockade busting: Iran supplies 1,000+ tons of food to Qatar every day

RT
Thu, 22 Jun 2017 20:59 UTC

Iran is sending 1,100 tons of fruit and vegetables to Qatar on a daily basis as the country endures a blockade by Saudi Arabia and other Gulf nations.

Saudi Arabia, Bahrain, the UAE, Egypt and other countries cut diplomatic ties and transportation links with Qatar early in June.

They accuse Doha of supporting terrorism and meddling in the internal affairs of other nations in the region. Doha has dismissed the claims.

The blockade led to fears of food shortages in a country that mainly depends on imports and saw people storming shops to secure supplies. The blockade was imposed in the midst of the Muslim holy month of Ramadan, making the situation more acute for Qataris.

Some 1,100 tons of food products are being supplied to Qatar from Iran every day, local media reported Mohammad Mehdi Bonchari, the Director of ports in Iranian Bushehr province, as saying.

The Bushehr ports on the Persian Gulf coastline are located some 148 nautical miles from Qatar offering the fastest maritime supply route between the two countries.

Tehran began deliveries to Doha shortly after the blockade was imposed, with Iran Air, the national carrier, saying it flew five plane loads of vegetables to the country on June 11.

Around the same period, Iran's cattle exporting association said that 66 tons of beef were sent to Doha, announcing plans to supply another 90 tons shortly.

Last week, Abbas Maroufan, the deputy for domestic trade at the Iranian Government Trading Corporation, told the media that Iran could satisfy the food demands of "ten countries like Qatar."

Reports of Iranian food supplies to Qatar are only coming from Tehran so far, with Qatari officials mum on the deliveries.

Qatar, which earlier praised the arrival of poultry and dairy products from Turkey, might be reluctant to acknowledge or reveal the help from Iran due to fears of further complications with Tehran's archrival, Saudi Arabia.

Some have on Twitter critisized Iran for sending food to a rich country like Qatar, while not to Yemen which is poor and starving. I think in defense of Iran that one has to consider that Iran also has to play the geopolitical game and use the opportunities of making new alliances and sow discord in the GCC world. It is not in the interest of Iran to become isolated and viewed as a pariah state and neither would it be in the interest of Yemen if that is what happened to Iran.

 

[angelburst29]

Reports said the United Nations aviation agency will hold a special hearing on June 30 after Qatar requested that the UN body intervene in the diplomatic crisis which has seen a Saudi-led bloc close its airspace to flights from Doha.

Qatar to Challenge Airspace Blockade at UN Special Hearing
http://en.farsnews.com/newstext.aspx?nn=13960404000801

Qatari transport minister Jassim Saif Al Sulaiti said that the country wants the International Civil Aviation Organization (ICAO) to open international air routes over (Persian) Gulf waters currently managed by the UAE, New Arab reported.

The UAE, Saudi Arabia, Bahrain and Egypt have all closed their airspace to Qatar following a decision to sever ties with the country earlier in June.

Six airlines owned by the countries leading the blockade or their allies have cancelled flights to Qatar in the wake of the diplomatic row.

A decision on Friday by the Montreal-based ICAO to a hold a briefing comes after Qatar Airways chief executive Akbar Al-Baker expressed concerns that the UN agency was not working quickly enough to solve the crisis.

Al Sulaiti said that Qatar is hoping to "get more routes for Qatar" and said he trusted the UN body to resolve the dispute and "take action very quickly," Reuters reported.

The ICAO was created in 1944 after the United States invited more than 50 allies to agree to a common air navigation system.

The international body's decision to intervene in the airspace blockade is a rare instance in attempting to mediate disputes between states.

The ICAO cannot impose rule on states but its 191 member countries normally enforce its international aviation standards.

Turkish President Recep Tayyip Erdogan on Sunday dismissed calls for Ankara to close a military base in Qatar and said a wider list of demands issued by four Arab states was an unlawful intervention against the emirate's sovereignty.

Turkey's Erdogan Says Arab Demands on Qatar Unlawful
http://en.farsnews.com/newstext.aspx?nn=13960404000896

In his strongest statement of support for Qatar in the nearly three-week-old crisis centered on the Gulf state, Erdogan said the call to withdraw Turkish forces was disrespectful and that Doha, which described the demands as unreasonable, was taking the right approach, New Arab reported.

A leading Arab daily disclosed that the Jordanian government has declared to Qatar that it has rejected the list of the terrorist groups presented by Saudi Arabia, the UAE, Bahrain and Egypt, after the latter group of countries asked Doha to cut off ties with a number of Islamist groups.

Rifts Widening Among Riyadh, Allies over Qatar
http://en.farsnews.com/newstext.aspx?nn=13960404001075

Al-Rai al-Youm newspaper reported that after the recent crisis between Qatar and the Persian Gulf Arab littoral states and their demands from Doha,
Jordan informed Qatar that the list of the terrorist groups presented by Saudi Arabia and its allies that also includes Ikhwan al-Muslimoun (Muslim Brotherhood) is not at all endorsed by Amman.

Informed sources told the Arab daily that Jordan is opposed to other Arab countries' positions against Hamas and Ikhwan al-Muslimoun as members of Ikhwan are lawmakers at the Jordanian parliament.

Jordan has underlined that it would never agree to endorse the list of terrorist groups released by certain Arab countries.

A prominent Arab analyst said earlier this month that Qatar's support for Ikhwan al-Muslimin is not the main reason for certain Arab countries' pressures and boycotts but Doha's refusal to bow to the US demand for money is the real cause.

"There is no doubt that the fire of crisis between Qatar and Saudi Arabia flared after US President Donald Trump's visit to Riyadh," Hoda Jannat wrote in Tunis al-Aan news website.

Before visiting Riyadh, Trump had called on Saudi Arabia, the UAE and Qatar to collect nearly $1.5 trillion before he leaves the Arab country to be able to quiet his critics in the US, the analyst wrote.

Most of the Arab regional countries had agreed to pay this money to protect their monarchies but Qatar retreated from its promise suddenly and infuriated the Saudi and UAE leaders, Jannat concluded.

On Friday, Saudi Arabia, Bahrain, the United Arab Emirates and Egypt handed a 13-point ultimatum to Qatar. The list contains demands Doha needs to meet in order to restore ties with other Arab nations.

Saudi-Led Ultimatum to Qatar Poses 'Risk of Serious Conflict' in the Gulf
https://sputniknews.com/middleeast/201706251054955899-saudi-ultimatum-qatar-crisis/

The ultimatum demands that Qatar, among other things, cut its ties with Iran, close a Turkish military base on its soil and shut down Al Jazeera and its affiliates. Other demands call on Doha to publically denounce relations with Islamist groups, end suspected financing of terrorism and hand over persons designated as terrorists by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt.

Moreover, Qatar is demanded to pay financial compensation, although the sum was not reported.

In response, Doha described the demands as "unrealistic" and "illegal" and urged for them to be revised after being given 10 days to comply. According to the Qatari foreign minister, sanctions imposed are an attempt at tampering with the nation’s sovereignty.

The current situation around Qatar may result in a conflict, according to Konstantin Truevtsev, an expert at the Valdai discussion club and senior research fellow at the Institute for Oriental Studies at the Russian Academy of Sciences.

"I suggest that it risks a serious conflict. This is an ultimatum. It will be very difficult for Qatar to meet those demands if Doha wants to preserve its sovereignty. In this case, it may be more than a blockade or breach of diplomatic ties. Currently, the situation is on the verge of war," Truevtsev said in an interview with Sputnik.

A leading Arab daily disclosed the secret meetings between the new Saudi Crown Prince Mohammed bin Salman and Israeli officials in the past two years.

Arab Daily Reveals Secret Meetings between New Saudi Crown Prince, Israeli Officials
http://en.farsnews.com/newstext.aspx?nn=13960403000509

Al-Qods al-Arabi newspaper reported that the Israeli media have all voiced pleasure in Mohammed bin Salman's appointment as the crown prince, adding that this development has long been wished by the Israelis.

The Arab daily quoted the Israeli newspaper Yediot Aharonot as reporting that the intelligence sources have confirmed that bin Salman has held meetings with the Israeli officials under a secret name, Walad, in the past two years.

The Israeli daily didn’t reveal the venues and time for the meetings, but wrote that Israel and Saudi Arabia have common foes, friends and interests.

It predicted that bin Salman will not reveal his cooperation with Israel rapidly and will continue his ties secretly.

Saudi King Salman replaced Crown Prince Nayef with his own son, Mohammed bin Salman, the deputy crown prince and defense minister this week.

A prominent Saudi dissident figure took Mohammed bin Salman, the new crown prince of the country, responsible for the terrorist attack in the holy city of Mecca.

Dissident Figure Blames New Saudi Crown Prince for Mecca Suicide Blast
http://en.farsnews.com/newstext.aspx?nn=13960403001409

Foiling the suicide attack in the Grand Mosque was a false-flag operation which was aimed at increasing popular support for bin Salman and covering up the developments related to bin Nayef's dethroning and its consequences," Hamza al-Hassan wrote on his webpage on Saturday.

The Saudi security forces claimed that they have foiled a terror plot targeting the Grand Mosque in the Muslim holy city of Mecca, exchanging gunfire with one of the suspects who blew himself up inside a home on Friday, the interior ministry said.

The ministry described the plot as part of “self-serving schemes managed from abroad”.

Five people, including a woman, were arrested in security operations in Mecca, the Saudi-owned Al-Arabiya news website said, citing interior ministry security spokesman Mansour al-Turki.

Five security force members and six other people were injured, the report said.

Turki said police “foiled the terrorist plan that targeted the security of the Grand Mosque, pilgrims and worshippers”.

Two days before the incident, Saudi King Salman replaced Crown Prince Nayef with his own son, Mohammed bin Salman, the deputy crown prince and defense minister.

The Saudi information ministry shut down a TV channel for rolling subtitles that said some Saudi tribes have defied expressing allegiance to new Crown Prince Mohammed bin Salman.

Saudi Channel Shut Down after Releasing Subtitles of Non-Allegiance to New Crown Prince
http://en.farsnews.com/newstext.aspx?nn=13960404000592

Social media users in Saudi Arabia reported that Badayah news channel has been closed after it released subtitles saying that bin Tamim tribes have rejected to express allegiance to the new crown prince.

They also started trending hashtag (#اغلاق_قناه_بدایة) in Arabic language meaning Badayah channel was closed.

 

[angelburst29]

On March 25, 2011, a Qatar Air Force Mirage 2000-5, took off from Souda Air Base, in Crete, to help enforce a no-fly zone protecting rebels being attacked by Libyan strongman Muammar Qaddafi. Qatar was the first Persian Gulf nation to help the U.S. in the conflict.

Tillerson and Mattis Cleaning Up Kushner’s Middle East Mess
http://www.theamericanconservative.com/articles/tillerson-and-mattis-cleaning-up-kushners-middle-east-mess/

Qatari operations were more than symbolic. The Qatari military trained rebel units, shipped them weapons, accompanied their fighting units into battle, served as a link between rebel commanders and NATO, tutored their military commanders, integrated disparate rebel units into a unified force and led them in the final assault on Qaddafi’s compound in Tripoli.“We never had to hold their hand,” a retired senior U.S. military officer says. “They knew what they were doing.” Put simply, while the U.S. was leading from behind in Libya, the Qataris were walking point.

The Qatar intervention has not been forgotten at the Pentagon and is one of the reasons why Defense Secretary James Mattis has worked so diligently to patch up the falling out between them and the coalition of Saudi-led countries (including the UAE, Bahrain and Egypt), that have isolated and blockaded the nation. In fact, Mattis was stunned by the Saudi move. “His first reaction was shock, but his second was disbelief,” a senior military officer says. “He thought the Saudis had picked an unnecessary fight, and just when the administration thought they’d gotten everyone in the Gulf on the same page in forming a common front against Iran.”

At the time of the Saudi announcement, Mattis was in Sydney with Secretary of State Rex Tillerson to dampen concerns about the Trump administration’s withdrawal from the Trans-Pacific Partnership and the Paris climate accords. The two glad-handed Australian officials and issued a reassuring pronouncement on U.S. intentions during a June 5 press briefing with that nation’s foreign and defense ministers. When the burgeoning split between the Saudis and Qataris was mentioned, Tillerson described it as no more than one of “a growing list or irritants in the region” that would not impair “the unified fight against terrorism …”

But while Tillerson’s answer was meant to soothe concerns over the crisis, behind the scenes he and Mattis were scrambling to undo the damage caused by Saudi action. The two huddled in Sydney and decided that Tillerson would take the lead in trying to resolve the falling out. Which is why, three days after the Sydney press conference, Tillerson called on Saudi Arabia, the UAE, Bahrain and Egypt to ease their anti-Qatar blockade and announced that the U.S. supported a Kuwaiti-led mediation effort. The problem for Tillerson was that his statement was contradicted by Donald Trump who, during a Rose Garden appearance on the same day, castigated Qatar, saying the emirate “has historically been a funder of terrorism at a very high level.”

A close associate of the secretary of state says that Tillerson was not only “blind-sided by the Trump statement,” but “absolutely enraged that the White House and State Department weren’t on the same page.” Tillerson’s aides, I was told, were convinced that the true author of Trump’s statement was U.A.E. ambassador Yousef Al Otaiba, a close friend of Trump son-in-law Jared Kushner. “Rex put two-and-two together,” his close associate says, “and concluded that this absolutely vacuous kid was running a second foreign policy out of the White House family quarters. Otaiba weighed in with Jared and Jared weighed in with Trump. What a mess.” The Trump statement was nearly the last straw for Tillerson, this close associate explains: “Rex is just exhausted. He can’t get any of his appointments approved and is running around the world cleaning up after a president whose primary foreign policy adviser is a 36-year-old amateur.”

Worse yet, at least from Tillerson’s point of view, a White House official explained the difference between the two statements by telling the press to ignore the secretary of state. “Tillerson may initially have had a view,” a White House official told the Washington Post, “then the president has his view, and obviously the president’s view prevails.”

Or maybe not. While Trump’s June 9 statement signaled that the U.S. was tilting towards the Saudis and the UAE, Tillerson and Mattis have been tilting towards Qatar. And for good reason. “Every time we’ve asked the Qataris for something they’ve said ‘yes,’ which isn’t true for the Saudis,” the retired senior U.S. military officer with whom I spoke says. “It really started with the help the Qataris gave us in Libya, but it goes well beyond that. They’ve been absolutely first rate on ISIS. The Saudis, on the other hand, have been nothing but trouble – in Yemen, especially. Yemen has been a disaster, a stain. And now there’s this.”

That view has been reflected by both Mattis and Tillerson. Six days after Trump’s statement, Mattis met with Qatari Defense Minister Khalid al-Attiyah to sign an agreement shipping 36 F-15 fighters to the Gulf nation. The $12 billion sale had been in the works for years, so Pentagon officials were able to claim that it had not been fast-tracked by Tillerson, whose department oversees arms transactions. But the Mattis announcement seemed suspiciously well-timed to signal Mattis’ and Tillerson’s views.

On the same day that Mattis was announcing the Qatar arms agreement, Tillerson told the House Foreign Affairs Committee that it would be a mistake to classify the Muslim Brotherhood as a terrorist group, one of the primary reasons that the anti-Qatar coalition gave for isolating their Gulf neighbor. “There are elements of the Muslim Brotherhood that have become parts of government,” Tillerson said, naming Turkey and Bahrain as having brotherhood members in their parliaments. Those “elements,” Tillerson added, have renounced violence and terrorism. “So, in designating the Brotherhood in its totality as a terrorist organization . . . I think you can appreciate the complexities this enters into our relations with [governments in the region].”

But the single most important reason for the Qatar tilt is obvious to anyone who knows how to read a map. The U.S. leases the al-Udeid Air Base, southwest of Doha, which is home to the Air Force’s 379th Air Expeditionary Wing. The U.S. (and the Qataris), not only mount fighter-bombers from al-Udeid against ISIS units in Iraq and Syria, the base serves as the first line of defense against Iranian encroachments in the region. Even more crucially, al-Udeid not only protects America’s Persian Gulf allies, it protects Israel – and would be a launching point for U.S. aircraft against Iran were Israel to be attacked by the Islamic Republic.

More crucially, particularly from Mattis’s point-of-view, the Saudi-Qatar feud not only shattered the anti-Iran coalition the administration cobbled together during the president’s trip to Riyadh, it redrew the geopolitical map of the Middle East. In the wake of the Saudi-Qatar falling out, Turkey pledged its support for Qatar (and deployed troops to a Qatari military base to guard Qatar’s sovereignty), while Iran took steps to help ease the Saudi-imposed blockade.

“The Saudis and Emiratis have told us repeatedly that they want to weaken Iran, but they’ve actually empowered them,” a senior Pentagon consultant who works on the Middle East told me. The Saudi actions, this official went on to explain, have backfired. Instead of intimidating the Qataris, the Saudis have “thrown them into the arms of the Iranians.” The result is an uneasy, but emerging Turkish-Qatari-Iranian alliance backed by Russia. “This isn’t just some kind of Gulfie dust-up, where we can go out and hold everyone’s hands,” this Pentagon consultant says. “The Saudis have handed the Iranians a gift and we’re on the outside looking in.”

The official then shook his head. “Listen, I can certainly understand where Mattis and Tillerson are coming from. I mean, with friends like these, who needs enemies.”

 

[angelburst29]

Residents of Qatar are having problems exchanging their riyals after exchange services worldwide stopped accepting them, following the economic blockade announced by Saudi Arabia and its Arab allies.

Riyal Boycott: Saudi Arabia Turns Screws on Qatar With Currency Blockade
https://sputniknews.com/middleeast/201706301055106152-qatar-blockade-riyal-exchange/

The Qatari riyal has fallen to its lowest trading value against the dollar in 12 years as a result of the boycott of Qatar by a group of Arab countries.

On June 5, Saudi Arabia, the UAE, Bahrain, Egypt, Yemen and Libya cut diplomatic ties with Qatar, alleging that the Gulf nation supports terrorists and militant groups with ties to Iran.

Saudi Arabia closed the crossing at Qatar's only land border, which Qatar uses to import about 40 percent of its food supplies. Qatar's Arab neighbors also denied permission for the national carrier Qatar Airways to use their airspace, and airline carriers from the UAE canceled all flights to Doha.

Iran, with which Qatar shares a natural gas field in the Persian Gulf, and Turkey, which has a military base in Qatar, have sent deliveries of food and other supplies to Qatar by sea.

While the Qatari riyal has been officially pegged at $3.64 to the dollar since 2005, offers for the currency have fallen below the fixed rate amid a fall in demand. According to Bloomberg data, the spot exchange rate for the riyal dipped to 3.79 on June 26, before recovering to 3.72 on Friday.

Financial traders said the two percent decrease in the riyal's spot exchange rate, despite the peg, is a result of low liquidity resuling from the sanctions, which have disrupted financial operations. The sanctions have led many banks in Saudi Arabia, the UAE and Bahrain to stop trading with Qatari institutions, while international banks have cut back on trading with Qatar because of political risk.

Most exchange houses in the Gulf have also stopped accepting Qatari riyals, and foreign exchanges in many countries have followed suit, citing a lack of demand for the currency.

"I'm in (Los Angeles) and I tried to exchange Qatari riyals at multiple banks (US Bank, Bank of America, Chase etc.) and they've informed me that a directive was sent out to all US banks not to accept Qatari Riyals at all," one Qatar resident told Doha News.

​In the UK, Halifax Bank of Scotland (HBOS) confirmed that they were not buying riyals from customers "as there was no market for selling them."

​​According to Arab News, the Post Office, one of the UK's main currency exchanges, "temporarily" stopped trading in riyals on June 5 because banks refused to trade in the currency.

"Banks we utilize to dispose of excess Gulf currencies informed us at the outset that they were no longer buying (Qatari riyals)," a Post Office spokeswoman told the news outlet.

Last week, Saudi Arabia, Bahrain, the United Arab Emirates and Egypt presented Qatar with a 13-point list of demands that it must fulfil in order to have the blockade lifted.

The ultimatum demands that Qatar, among other things, cut its ties with Iran, close the Turkish military base on its soil and shut down Al Jazeera and its affiliates. Other demands call on Doha to publically denounce relations with Islamist groups, end its suspected financing of terrorism and hand over persons designated as terrorists by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt. Moreover, financial compensation is demanded of Qatar, although the sum was not reported.

 

[angelburst29]

While the Qatar crisis may have slipped from the front pages, the diplomatic standoff continues to deteriorate with the latest escalation emerging yesterday, when the UAE’s ambassador to Moscow gave an interview to the UK’s Guardian newspaper, revealing the steely resolve of the Gulf States, led by Saudi Arabia, who initially brought their charges and subsequent sanctions to bear on the tiny country.

The "Diplomatic Quagmire" In Qatar Deepens 3 Days Before The Saudi Ultimatum Expires
http://www.zerohedge.com/news/2017-06-29/diplomatic-quagmire-qatar-deepens-3-days-saudi-ultimatum-expires

Omar Ghobash, the UAE’s ambassador, said that the states are considering “further economic pressure” and that they would be “willing to make themselves subject to the same western monitoring regime as Qatar to ensure key figures are not privately funding extremist groups”.

As a reminder, Qatar only has until July 3 to comply with a list of 13 demands imposed by the Saudi-led bloc, and on Tuesday, Saudi described the demands as non-negotiable: Doha must “amend its behaviour” or “remain isolated”, says Riyadh's foreign minister Adel al-Jubeir.

Meanwhile, Turkey’s President Erdogan has been ramping up his rhetoric in support of Qatar, and has been contemplating the deployment of troops to Doha, saying that the ultimatum “breaches international law”. Qatar is now reliant on Iran and Turkey for food imports.

Unless the demands are met by July 3 (and it seems highly unlikely that they would be or could be for some – such as the complete shutdown of Al Jazeera station that has been demanded) then this situation is likely to get a lot worse before it gets any better.

Meanwhile, as Citi notes, there has been a continued lack of reaction from ‘the West’: there is also confusion as to the stance of key historical players in the Middle East, such as the UK and the US, who have either said very little – Trump once called Qatar a “haven for terrorism”, while Rex Tillerson has twice upbraided Saudi Arabia’s approach. Last Friday, a White House spokesman told the Guardian: “The United States is still accessing the list and we are in communication with all parties. As we have said, we want to see the parties resolve this dispute and restore unity among our partners in the region, while ensuring all countries are stopping funding for terrorist groups.”

 

[JGeropoulas]

The real reason for the Saudi-lead coalition against on Qatar.

Saudi Arabia Has Handed the Emir of Qatar an Opportunity to Redirect History

Paul Craig Roberts
June 29, 2017

In the event you have noticed the hullabaloo about Qatar and wonder what it is about, it is about Al Jazeera, a news organization, established by the Emir who rules the oil and gas sheikdom on the Persian Gulf. Al Jezeera is far more professional than any news organization in the West. Al Jazeera’s problem is that it covers the actual news and tells the truth. This is unacceptable to the Saudis, the United Arab Emirates, and to Washington.

At the time of the US invasion of Iraq the Crown Prince of the UAE requested that Washington bomb Al Jazeera so that the Arab world would not be inflamed by truthful reporting of the US attack on Iraq. In April 2003 Al Jazeera’s Baghdad office in Iraq was struck by a US missile, killing one journalist and wounding another. Of course, Washington claimed it was just a mistake. _http://www.globalresearch.ca/uae-crown-prince-asked-us-to-bomb-al-jazeera-says-2003-cable/5596718

Qatar has the highest per capita income in the world—$129,700 in 2016—a sum to which American per capita income compares very poorly.

Qatar also hosts the largest US military base in the Mideast. This fact makes the list of demands or else that Saudi Arabia has handed to Qatar perplexing. Essentially, the Saudis accuse Qatar of “supporting terrorism” because the Emir permits Al Jazeera to tell the truth. The second demand on the list is that Qatar close down Al Jazeera.

The Emir is proud of Al Jazeera, and he should be. On the other hand Qatar shares a land border with Saudi Arabia. But the Saudis are bogged down as Washington’s proxy in a war with Yemen. Does Saudi Arabia want a second front? What would Washington’s response be to a Saudi attack on a country that hosts Washington’s largest military base in the Middle East?

Is Qatar to be incorporated into Saudi Arabia? If so, the problem returns of the infidel having military troops in the country that protects the holy shrine of Mecca. What is certain is that Washington is not going to let go of its largest base in the Middle East.

Still, Washington hates Al Jazeera. So, can we expect that Washington will pressure the Emir to comply with the Saudi demand? What if the Emir instead ordered Washington out and installed the Russians, or the Iranians with whom the Emir is on speaking terms? If the Emir could evade the CIA assassination attempts, he could single handedly change the course of history.

Only the corrupt Saudi monarchy and the idiots in Washington could create such an opportunity for a mere Emir. If I were the Emir, I would be on the telephone with Vladimir Putin.

http://www.paulcraigroberts.org/2017/06/29/saudi-arabia-handed-emir-qatar-opportunity-redirect-history/

 

[angelburst29]

Saudi whistle-blower Mujtahid, who is believed to be a member of or have a well-connected source in the royal family, revealed high tensions in Saudi Arabia and said a threat of a coup to topple the king and his son is highly likely.

Whistle-Blower: S. Arabia on Threshold of Internal Coup
http://en.farsnews.com/newstext.aspx?nn=13960411001695

"Moves in the al-Saud family to oust Salman bin Abdulaziz (the Saudi king) have increased by those who support Ahmed bin Abdulaziz (the king's brother) as they are convincing him of taking the leadership in Saudi Arabia," Mujtahid wrote on his twitter page on Sunday.

He added that the princes who have joined the move intend to issue a statement to declare King Salman's incompetency for continued leadership of the country and nullify his recent order that brought his son to the post of the Crown Prince.

A leading Arab daily had also said in an analysis written by an Israeli expert on Saturday that chances are high that a coup is staged in Saudi Arabia to bring down the new crown prince, Mohammed bin Salman, and send him to exile.

"The new crown prince has played an important role in distorting Saudi Arabia's stability since 2015," al-Rai al-Youm quoted Shaul Yanai as saying on Saturday.

Noting that the only power which can invalidate the Saudi king's order to replace the crown prince is the Royal Council, he said the Council can incapacitate the king under the pretext of his poor health conditions and inability to make wise decisions.

"In such conditions, bin Salman will also be dethroned and he might even be sent to exile for a long period of time," Yanai said.

Last month, Saudi King Salman bin Abdulaziz replaced Crown Prince Mohammed bin Nayef bin Abdulaziz with his own son, Mohammed bin Salman, the deputy crown prince and defense minister.

According to a royal decree, Mohammed bin Salman, 31, was also named deputy prime minister, and shall maintain his post as defense minister, the official Saudi Press Agency (SPA) reported.

The SPA also confirmed that 31 out of 34 members of Saudi Arabia’s succession committee chose Mohammed bin Salman as the crown prince.

The Saudi king had earlier stripped Nayef of his powers overseeing criminal investigations and designated a new public prosecution office to function directly under the king’s authority.

In a similar move back in 2015, the Saudi king had appointed his nephew, then deputy crown prince Mohammed bin Nayef as the heir to the throne after removing his own half-brother Prince Muqrin bin Abdulaziz Al Saud from the position.

Under the new decree, King Salman further relieved Mohammed bin Nayef of his duties as the interior minister. He appointed Prince Abdulaziz bin Saud bin Nayef as the new interior minister and Ahmed bin Mohammed Al Salem as deputy interior minister.

Mohammed Bin Salman is already in charge of a vast portfolio as chief of the House of Saud royal court and chairman of the Council for Economic and Development Affairs, which is tasked with overhauling the country’s economy.

The young prince was little known both at home and abroad before Salman became king in January 2015.

However, King Salman has significantly increased the powers of Mohammed, with observers describing the prince as the real power behind his father’s throne.

The power struggle inside the House of Saud came to light earlier this year when the Saudi king began to overhaul the government and offered positions of influence to a number of family members.

In two royal decrees in April, the Saudi king named two of his other sons, Prince Abdulaziz bin Salman and Prince Khaled bin Salman, as state minister for energy affairs and ambassador to the United States, respectively.

Late April, media source disclosed that Mohammad bin Salman has literally bribed the new US administration by paying $56m to Donald Trump.

According to reports, bin Salman is paying off the US to buy its support for finding a grip over the crown.

"Since Uncle Sam's satisfaction is the first step for the Saudi princes to get on the crown, paying off Washington seems to be a taken-for-granted fact," Rami Khalil, a reporter of Naba' news website affiliated to the Saudi dissidents wrote.

He added that since the Justice Against Sponsors of Terrorism Act (JASTA) is like a sword over the head of the al-Saud, they have no way out but to bribe the US, noting that the Yemen quagmire is also another reason for Riyadh to seek Washington's support.

Also, a prominent Yemeni analyst said early June that the US has been paid several trillion dollars by Saudi Arabia to protect its crown, adding that Riyadh has recently bribed Washington's support for the Yemen war with $200bln.

"Washington has asked for more money to defend the Saudi regime and Riyadh has recently paid $200bln to the US for the costs of its support for the war in Yemen," Saleh al-Qarshi told FNA. "This is apart from the huge amounts of money that Saudi Arabia pays to the US treasury for protecting its crown," he added.

According to al-Qarshi, former Saudi Intelligence Chief Turki al-Feisal revealed last year that his country has bought the low-profit US treasury bonds to help the US economy.

As the defense minister, Mohammed bin Salman has faced strong international criticism for the bloody military campaign he launched against neighboring Yemen in 2015 amid his rivalry with bin Nayef, the then powerful interior minister.

Saudi Arabia has been striking Yemen since March 2015 to restore power to fugitive president Mansour Hadi, a close ally of Riyadh. The Saudi-led aggression has so far killed at least 14,000 Yemenis, including hundreds of women and children.

The World Health Organization (WHO) in Yemen also announced that more than a thousand Yemenis have died of cholera since April 2017 as Saudi Arabia's deadly campaign prevented the patients from travelling abroad for treatment and blocked the entry of medicine into the war-torn country, continues hitting residential areas across Yemen.

Despite Riyadh's claims that it is bombing the positions of the Ansarullah fighters, Saudi bombers are flattening residential areas and civilian infrastructures.

According to several reports, the Saudi-led air campaign against Yemen has drove the impoverished country towards humanitarian disaster. Nearly 3.3 million Yemeni people, including 2.1 million children, are currently suffering from acute malnutrition. The Al-Saud aggression has also taken a heavy toll on the country’s facilities and infrastructure, destroying many hospitals, schools, and factories.

The WHO now classifies Yemen as one of the worst humanitarian emergencies in the world alongside Syria, South Sudan, Nigeria and Iraq.

 

[Ca.]

Qatar Cash Crisis Looms As Interbank Rates Hit Record Highs
by Tyler Durden Jul 6, 2017 2:40 PM
http://www.zerohedge.com/news/2017-07-06/qatar-cash-crisis-looms-interbank-rates-hit-record-highs
Link's

We warned previously that Qatar was running out of cash, and it appears that is very much the case as the cost of interbank borrowing (liquidity provision) hits a record high.

To boost their hard currency reserves, Qatar banks are now offering a premium of as much as 100 basis points over LIBOR to attract dollars from regional banks, some 80 bps higher compared to the rate they offered prior to this crisis. And the soaring cost of interbanking liquidity provision suggests its not working...
Chart:
http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/07/05/20170706_QIBOR_0.jpg

As Arqaam Capital analysts Jaap Meijer and Janany Vamadeva note in a recent report...

A prolonged conflict between Qatar and its neighbors may leave the country’s banking sector "vulnerable” because of its reliance on foreign funding. They reiterate underweight rating on the sector.

Arqaam doesn’t rule out renewed sanctions as Arab nations disappointed with Qatar’s response to list of 13 demands, and notes that the Qatari banking sector is "highly dependent on foreign funding (wholesale debt and deposits) with low operational relationships."

The banking sector relies on foreign markets for 43% of its funding needs, with non-resident deposits making up 46%, interbank 43% and wholesale debt 11%.

Qatar Islamic Bank has the highest share of funding coming from the Gulf Cooperation Council at 24%, Qatar National Bank the least at 5%, though has the highest dependency on foreign funding at 57%.

A benevolent government and reserves/sovereign wealth fund offer some comfort, but Meijer and Vamadeva suggest strongly underweight on the sector due to profit deterioration

As we noted previously, despite the spike in interbank rates, S&P is confident that Qatari banks are strong enough to survive the pullout of all Gulf money and then some. The ratings agency ran two hypothetical scenarios of capital flight, and concluded that Qatar’s lenders could survive the withdrawal of all Gulf deposits plus a quarter of the remaining foreign funds the banks keep. Still, that did not prevent S&P from lowering Qatar’s long-term rating by one level to AA- last week.

Separately, Reuters reports, that the dollar shortage has also spread over to money exchange houses in Qatar on Sunday, making it harder for worried foreign workers to send money home.
Image:
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/06/04/qatar%20dollars_0.jpg

"We have no dollars because there is no shipment or transportation from the United Arab Emirates. There is no stock," said a dealer at the Qatar-UAE Exchange House in Doha's City Center mall. "The shipment is blocked from the UAE" the dealer added, although it was not quite clear if it was physical cash that was being transported.

Other exchange houses in Doha also told Reuters they had no supplies of dollars. At Qatar-UAE Exchange, dozens of people - some of the foreigners who comprise nearly 90 percent of the population of 2.6 million - waited quietly in line to change money or make remittances to their home countries.

"I spoke with my wife this morning. She said, 'Send your savings to me now.' I am not panicked but my family are scared," said John Vincent, an air-conditioning repairman from the Philippines.

"I sent 2,000 riyals ($550) home but I have some more savings left here in Qatar. I will see what the situation is in coming days before I decide what to do."

Sudhir Kumar Shetty, president of UAE Exchange, which has eight branches in Qatar, said his firm was continuing to handle remittances and currency buying as usual in that country. He said the firm hadn't seen any major change in remittance volumes due to the diplomatic tension.

But he added that dollar supply was not meeting demand in Qatar and attributed this partly to flows of the U.S. currency from other Gulf countries being disrupted.

"Everywhere, all the banks and exchange houses, there are no dollars. All the exchange houses are trying to get currencies from other countries," the dealer at Qatar-UAE Exchange said, adding that his firm was hoping for a shipment from Hong Kong.

For now most Western banks with a presence in Qatar have continued business as normal, partly because they did not want to lose out on billions of dollars of building projects which Qatar plans before it hosts the soccer World Cup in 2022. But other Western banks have halted new Qatar business including interbank and syndicated lending, while continuing to service existing business, banking sources said, declining to be named because of political sensitivities.

"Everybody is shocked - they're not worried about Qatar's credit, they're worried about compliance and the risk that the local sanctions could be escalated to an international level," said one foreign banker in the region.

In a worst case scenario, bankers expect Qatari banks to borrow from the central bank's repo facility if they become short of funds. However, central bank rules limit the size of the repos to 2% of each bank's private sector deposits. Bankers speculate the central bank may lift this cap although the central bank did not respond to Reuters requests for comment.

Libyan War, Syrian War And Qatar Crisis
Published on Jul 6, 2017

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U.S. Gas Exporters Brushing Aside Qatar’s Grab for Market Share
By Naureen S Malik July 5, 2017, 11:39 PM GMT+2 July 6, 2017, 6:01 AM GMT+2
https://www.bloomberg.com/news/articles/2017-07-05/qatar-s-surging-gas-supplies-aren-t-worrying-u-s-gas-exporters
Links:

America’s gas exporters are, at least for now, brushing aside Qatar’s bid to claim a bigger share of the global market.

Qatar’s plan to dramatically boost gas output signaled to rivals including Australia and the U.S. that the race is on to find buyers and lock them into long-term contracts. American LNG exporters have already spent years pursuing such agreements, with President Donald Trump promoting their product in recent meetings with Chinese and Japanese leaders. Last week, South Korea said it would consider buying into three U.S. LNG projects.

The reaction from Meg Gentle, chief executive officer of U.S. LNG exporter Tellurian Inc., to Qatar’s ramp-up: The world needs more LNG capacity to meet growing demand, and “we welcome all potential supply sources.” Zdenek Gerych, a spokesman for U.S. LNG terminal developer Freeport LNG, said Wednesday, “My only comment on the Qatar issue: ‘They have to sell the volumes first.”’

Indeed, the impact of Qatar’s gas plans -- announced just as Arab nations that severed ties with the country gathered in Egypt to discuss a path forward -- will hinge largely on whether the world’s biggest liquefied natural gas supplier can secure even more long-term supply agreements with buyers in Europe and Asia. These contracts, typically lasting 15 to 20 years, have been crucial to keeping LNG projects around the globe moving forward. Without them, proposals have fallen apart amid a worldwide supply glut.

“Qatar will need to find off-take agreements to increase their supply that significantly,” said Charlie Riedl, executive director of the Center for Liquefied Natural Gas, a Washington-based industry group. U.S. projects, meanwhile, remain “well-positioned to respond to increasing demand” for LNG going into the next decade, he said.

U.S. exporters already have contracts to supply more than 80 million metric tons of LNG a year, according to estimates compiled by Bloomberg New Energy Finance. Developers are vying for more in an effort to secure financing to build terminals over the next decade.

Since the first cargo of shale gas set sail last year, America’s gas has reached about two dozen countries, reshaping how LNG is traded and setting the U.S. on a course to becoming a net-exporter of the fuel for the first time in decades. Some industry executives including Enbridge Inc. Chief Executive Officer Albert Monaco have suggested the U.S. may even jump ahead of Qatar and Australia to become the world’s biggest LNG supplier by 2035 -- a threat Qatar may be looking to quash with its latest move.

Qatar Petroleum plans to boost gas output by 30 percent to 100 million tons a year within seven years through a new project in the country’s North Field, the state-owned producer said Tuesday. Prior to this announcement, analysts including Energy Aspects Ltd. forecast that the country would lose its title as the world’s biggest LNG supplier to Australia.

Qatar still stands to make life more difficult for U.S. LNG suppliers. The North Field will allow the country to sell more of some of the cheapest gas in the world, Victoria Zaretskaya, a Washington-based analyst for the U.S. Energy Information Administration, said by email. That’ll have “major implications” for LNG export terminals that companies are proposing to build in the U.S. in the next decade, she said.

For more on the impact of the Qatar dispute on the world’s LNG markets, read this Bloomberg New Energy Finance report.

Boosting output in Qatar may end up jeopardizing one the country’s own projects. Zaretskaya said more supplies from the North Field could put the Golden Pass LNG terminal in Texas, being developed by a joint venture between Qatar Petroleum, Exxon Mobil Corp. and ConocoPhillips, at risk. Other projects that may be affected are Liquefied Natural Gas Ltd.’s Magnolia LNG terminal and the Lake Charles project being proposed by Energy Transfer and Royal Dutch Shell Plc, both in Louisiana, she said. Altogether, they’ve gained approval to liquefy 5.2 billion cubic feet of U.S. gas a day.

These projects “won’t go forward without a clear understanding” of which customers and what markets will take their supplies, Zaretskaya said.

“We are entering an interesting period of ‘courtships’ between prospective sellers and buyers,” she said. “And there may be some other factors to play in who gets the contracts and what other concessions were made to ‘sweeten the deal.”’