Germany Warns About Saudi Funded Radicalism and Aggression
The latest piece of evidence for Team Rogue Money's thesis about a potential collapse of the Saudi royals came from Germany's partner agency to the CIA, the Bundesnachrichtendienst. The BND leaked a memo that says the Saudi Kingdom has become a destabilizing power in the Middle East, particularly due to the ambitions of its 30-year-old Crown Prince and Defense Minister Muhammad bin Salman.
Later in the week, when it seemed the government of Chancellor Angela Merkel was trying to contradict its own intelligence agency's conclusions, Vice Chancellor Sigmar Gabriel backed up the BND report by accusing the Saudis of funding Wahhabist extremism in an interview with the Bild am Sonntag (incidentally the same German publication that reported the deployment of over 400 U.S. mercenaries to Ukraine in the spring of 2014). In that same interview, Gabriel told the newspaper, "I think the period of frosty relations with Russia should end." (Gabriel said this the same weekend Marine Le Pen and her niece Marion's National Front won big in French regional elections).
Internal power struggles and the desire to emerge as the leading Arab power threaten to make the key Western ally a source of instability, according to the BND intelligence service.
“The current cautious diplomatic stance of senior members of the Saudi royal family will be replaced by an impulsive intervention policy,” a BND memo widely distributed to the German press reads.
The memo focuses particularly on the role of Prince Mohammed bin Salman, the 30-year-old son of King Salman who was recently appointed deputy crown prince and defence minister.
The concentration of so much power in Prince Mohammed’s hands “harbours a latent risk that in seeking to establish himself in the line of succession in his father’s lifetime, he may overreach,” the memo notes.
“Relations with friendly and above all allied countries in the region could be overstretched.”
Prince Mohammed is believed to have played a key role in Saudi Arabia’s decision to intervene in the civil war in Yemen earlier this year.
Reuters added to the developing story:
The German government rebuked the BND agency for making such suggestions about Saudi Arabia, an important business partner that is involved in international talks to find a political solution to the Syria crisis..
"We need Saudi Arabia to solve the regional conflicts," Sigmar Gabriel, the head of the Social Democrats (SPD) who share power with conservative Chancellor Angela Merkel, told the mass-circulation newspaper Bild am Sonntag.
"But we must at the same time make clear that the time to look away is past. Wahhabi mosques are financed all over the world by Saudi Arabia. In Germany, many dangerous Islamists come from these communities," he said.
Saudi Finances Are Bleeding Out
The godfather of Team Rogue Money, Agent 'W', warned on his December 1, 2015 broadcast on the Caravan to Midnight program with John B. Wells that Saudi Arabia represents the weakest point of Washington's petrodollar empire. If Russia can withstand a few more years of low oil prices also creating tremendous pain for the Russian economy, 'W' said, then the House of Saud might fall or at least be forced to make radical changes in its domestic and foreign policies favorable to the Eurasian axis, led by Russia and China. Starting with, according to Jim Willie's source 'the Voice', accepting payment for Saudi crude in not only yuan but also Indian rupees and all sorts of other currencies besides the dollar or euro.
But will de-dollarizing be enough to save the Sauds? Or will the Kingdom collapse like the once mighty Soviet Union its old adversary in 1980s Afghanistan under the weight of its own contradictions?
The International Monetary Fund (IMF) estimates of the Saudis having at least five years of stored up capital to burn, 'W' warned, might be overly optimistic. At current or even worse lower oil prices crashing into the $20s per barrel, Saudi Arabia could go broke in approximately three years or less, the Intelligence Insider suggested.
Saudi Arabia has about $650 billion in foreign reserves to help it withstand the slump in oil prices. But at the country’s current rate of spending, it won’t take long before the supply of reserves runs out.
According to a recent IMF report, the drop in oil prices from around $100 per barrel in 2014 to $45 per barrel this summer has already cost oil exporters in the Middle East roughly $360 billion this year. Without drastic action, several countries are at risk of using up their cash reserves within five years. From the IMF’s World Economic and Financial Survey, published on Oct. 15:
“Apart from Kuwait, Qatar, and the United Arab Emirates, under current policies, countries would run out of buffers in less than five years because of large fiscal deficits.”
Saudi Arabia, the region’s largest oil exporter, is particularly vulnerable as 90% of its export earnings come from the petroleum sector. The country relies on its reserves to help finance its public spending and has spent more than $70 billion of these reserves since oil prices began falling last year.
The decline in oil prices already has led Saudi Arabia to run up a deficit as a result of maintaining high public spending. The IMF reports that the country is expected to have a budget deficit of 21.6% of GDP this year, moderating to 19.4% in 2016. This compares with a deficit representing 3.4% of GDP last year.
Certainly the Kingdom can take some steps to cut back on the extravagant lifestyles of its royal family, who number into the tens of thousands. On the other side of the ledger, the Saudis could engage in both overt and covert efforts to temporarily lift oil prices. For example, the Saudis could try to negotiate production cuts with OPEC. But the massive glut of oil and lack of storage tank and tanker space all over the planet mitigates against that -- as does arch-enemy Iran smelling Saudi blood in the water.
It's no accident, as Dr. Jim Willie reports, that Iran will soon bring hundreds of thousands of barrels of daily production online at the very moment that Saudi finances are hemorrhaging red ink. There is also evidence that other members of OPEC besides Iran are in no mood to do the Saudis any favors -- countries like Nigeria and Venezuela have historically had trouble enforcing production cuts anyway due to rampant corruption and in the case of the West African nation, oil theft by local warlords.
Russia meanwhile, under the highly secure presidency of Vladimir Putin, has also proven it can endure the pain of low oil prices far longer than Western analysts had thought possible without any signs of serious social discontent -- though Putin's likely successor would likely face trouble if the oil glut turns into an economic lost decade for Russians. Talks between Vladimir Putin and Prince Muhammad bin Salman seem to have been serious, and involved no fewer than two visits to Moscow since August. But the enthusiasm of those like my friends at Russia Insider for a flowering of a new petro-power alliance between the Russians and Saudis proved short lived, as much like the aborted Turkstream pipeline there was no way Washington would ever tolerate such independence from its ARAMCO and neo-Ottoman viziers.
Those of us on the outside cannot see any signs of abating Saudi enthusiasm for arming their jihadist proxies in Syria, but we can see countries that once facilitated the flow of arms and young Saudi men to the likes of Al-Nusra or ISIS such as Jordan losing their stomach for the whole project. We see Elijah J. Magnier, a Mideast analyst we'd never heard of before the Russian intervention in Syria, reporting about disastrous Saudi losses in Yemen and for their Syria proxies as well in a Kuwaiti-owned newspaper. While there historically has been no love lost between the Kuwaiti and Saudi royal families due to the latter's slant drilling and longtime support for Saddam until the Iraqi dictator became an enemy of both the Gulf Arabs and the U.S., Magnier's excellent Syrian military sources and Kuwaiti employment is a sign. A sign that the Kuwaitis may be quietly positioning themselves for the coming global economic 'reset' and already looking to China and Russia for protection once the petrodollar empire is no more.
At any rate, the combined Syrian/Russian forces, beefed up by more Russian and now Iranian Revolutionary Guard Corps advisers and ground troops, are crushing Riyadh and Ankara's proxies in Latakia, Idlib, and Aleppo provinces. Russian advisers have also posed for the cameras outside of the ISIS held ancient town of Palmyra, whose liberation by a rapid SAA/Hezbollah strike using Russia's airpower would be a highly symbolic blow to Daesh (and a big 'screw you' to Washington's 'Russia isn't really fighting ISIS' propagandists).
Turkey's Desperate Mosul Gambit and Why It's Likely to Fail Like Saudi Intervention in Yemen
Meanwhile, the neo-Ottoman sultan in Ankara, Recep Tayyip Erdoğan, is running the risk of pulling a Saudi Arabia-in-Yemen inside northern Iraq. In response to a battalion if not brigade-sized incursion into Iraqi territory, some Iraqi Shi'a MPs have called for the government to invite the Russians in to bomb the Turks. Turkish media reports Ankara's soldiers are alternatively training Kurdish peshmerga fighters under the corrupt, ISIS oil dealing leadership of (likely CIA asset) Masoud Barzani to take the city of one million people Mosul from ISIS, or establishing a 'permanent' base in the pre-WWI Ottoman villayet region of outside the ISIS-held metropolis.
For their part, Iraqi Shi'a militias backed by Iran have vowed to fight Turkey's soldiers if they do not withdraw, and fight Americans if they come into Iraq without the government's permission. Prime Minister Haider al-Abadi, still somewhat dependent on U.S. military supplies (but receiving almost zero combat support) for the fight against Daesh at Ramadi, has been more cautious. Abadi issued a 48 hour ultimatum to the Turks to pull their troops out, and has reportedly convinced Ankara not to reinforce their several hundred man garrison complete with tanks and artillery occupying territory inside Iraq.
Under the Bus You Go Turkey and Saudi Arabia!
As Joseph P. Farrell reported in his December 3, 2015 video edition of the Nefarium, it seems both Saudi Arabia and Turkey could be 'on the menu' of their former Western backers. A bloody Turkish intervention in northern Iraq that involves Kurds of the PKK and their YPG allies fighting the Turks and a handful of Barzani Kurdish loyalists and Sunni Arab tribes could be just the thing to destabilize Erdogan's government and ignite insurgency across Kurdistan deep inside Turkish territory. What long term agenda the simultaneous destabilization of Turkey and its primary financial backer Saudi Arabia would serve, will surely be the subject of future team RogueMoney analysis. But as we have written several times here at Rogue Money over the past two weeks, it's not an accident that GOP presidential 'front-runner' Donald Trump AND no fewer than FOUR ranking retired U.S. generals have either criticized the shoot down of the Russian SU-24 or accused the Turkish government if not the Erdogan family of trafficking in stolen ISIS oil.
Can the Saudi Kingdom Be Saved?
Turning back to the Kingdom's 'home front', austerity cannot be implemented without creating additional discontent and pressure inside the royal family itself. Nor can the Saudis, having started not one but TWO all out proxy wars with Iran inside Syria and Yemen simply 'back out' without being perceived by all of their regional bought and paid for allies as a weak horse, a fading stallion bound for the glue factory. We've already seen as the Guerrilla has noted anonymous calls for real reforms in the Kingdom that would relax some strict Wahhabist Islamic sharia law restrictions on women's rights, and trying to diversify the Saudi economy a bit from oil the way the United Arab Emirates led by Abu Dhabi have done with some success.
The answer to whether even a young ambitious prince like Mohammed Bin Salman has enough time in the next two years to make reforms though -- or whether the Kingdom could like the Soviet Union survive its own perestroika -- is almost certainly no. Or more bluntly, hell no.
KSA Body Count from the Yemen War -- Over 2,000 Killed in Action, Thousands of Civilian and Yemeni Combatants
This past week's leak of Saudi and KSA-hired mercenary casualties in the disastrous war against Yemen that Mohammed bin Salman reportedly instigated appears to be on more salvo in the Game of Thrones being played for the Kingdom's future. But it may also be a message from Iran to the Kingdom that once aspired to lead the Sunni faithful to victory over the Shi'a dogs that Riyadh is on the brink of losing everything, and the whole world is starting to wake up to that fact:
In a series of tweets released on Thursday morning, the famous Saudi whistleblower known on Twitter as “@Mujtahidd” leaked more information from the Saudi government’s classified files, revealing the army’s death toll and the total number of lost military equipment during the ongoing Yemeni War.
According to the aforementioned source, the Saudi Army has lost almost 2,000 soldiers (4,850 soldiers reportedly wounded), 450 tanks, 4 U.S. manufactured Apache Helicopters, 15 other military aircrafts, 3 boats (destroyed by P-15 Termit anti-ship missiles), and almost 200 billion Saudi riyals in damage.
The Twitter user is well-known for his accurate information and his government leaks that have time and time again proven to be authentic, despite his unknown identity.