The New American Alliance

The New American Alliance

DAY

Western diplomacy is going through one of the worst times in its recent history. During World War II, the United States and the United Kingdom were forced into an alliance with the Soviet Union to defeat Hitler's Germany.  

No one liked this unholy alliance. The war in Ukraine and the rise of Chinese power are forcing the United States and its allies to practice the same type of alliance with dictatorships that are repugnant to them. Joe Biden is meeting with the leaders of Saudi Arabia and other countries in the region when he would rather ignore them. But he needs them, as they need him. Oil and gas are at the heart of a new alliance that is emerging between countries with opposing regimes.

1. What is the United States asking of Saudi Arabia?

The United States wants the country to dramatically increase its oil exports to drive down global energy prices. Of course, no oil country has an interest in lowering oil prices. Moreover, the rise in oil prices in recent months is not the result of an imbalance between oil supply and demand. This increase was caused by concerns stemming from the war in Ukraine. Pumping more oil into the market could cause prices to drop dramatically because global supply concerns ease significantly.

2. How can the United States persuade Saudi Arabia?

The United States wants the country to dramatically increase its oil exports to drive down global energy prices. Of course, no oil country has an interest in lowering oil prices. Moreover, the rise in oil prices in recent months is not the result of an imbalance between oil supply and demand. This increase was caused by concerns stemming from the war in Ukraine. Pumping more oil into the market could cause prices to drop very sharply because global supply concerns ease significantly.

3. Is the United States interested in other dictatorships?

Saudi Arabia is not the only country capable of pumping more oil into the market. Venezuela and Iran are selling off their oil because of the economic sanctions imposed on these two countries. The main buyers of Iranian and Venezuelan energy are China and India. But since the war in Ukraine began, the discounts offered by Venezuela have reportedly increased from 50% to 66%. Why ? Because Russian oil now competes with Iranian and Venezuelan oil. However, Venezuelan oil installations are in poor condition and the sale of Iranian hydrocarbons requires the conclusion of an unlikely agreement on the Iranian nuclear program.  

4. What else will the talks focus on?

Biden is coming to the region with a draft Middle East NATO. The United States, Israel and Saudi Arabia would be at the heart of this local military alliance which would aim to protect its members against Iran and possibly against Russia. However, some countries in the region, such as the United Arab Emirates, prefer to maintain cordial relations with Iran. But, above all, the Palestinian cause is still close to the hearts of the people of the region and alliances with Israel remain frowned upon as long as the problem is not resolved. 

5. What would a new alliance in the Middle East be worth?

This alliance would probably be weak, because dictated by immediate circumstances.

The New American Alliance