Executive Summary
In an interview this week, President Joe Biden promised there would be consequences for Saudi Arabia following the OPEC+ decision to significantly cut oil production. The administration has yet to specify what measures may be taken, but a temporary freeze on arms sales and a repositioning of strategic assets in the region remains likely. More broadly, US officials discussed an impending revaluation of strategic ties with Saudi Arabia and the UAE, marking the end of the more conciliatory approach adopted by the Biden administration since the start of the Ukraine war.
Aside from widening the US-Saudi rift, the implications for regional security dynamics remain to be seen depending on what measures are taken. Regardless, the threat of consequences comes at a delicate time for both the UAE and Saudi Arabia as the truce in Yemen expired, raising the outlook for a resumption of Houthi-linked attacks on strategic assets in the Gulf.
President Biden says there will be “consequences” to OPEC+ decision
Responding to the Saudi-led OPEC+ decision to cut daily oil production by two million barrels, President Joe Biden said there would be “consequences” and that the administration will soon take action amidst rising energy prices. In an interview on 11 October, Biden said “I’m not going to get into what I’d consider and what I have in mind. But there will be — there will be consequences.” State Department Spokesperson Ned Price also said the administration is “reevaluating” the relationship with Riyadh as it continues to directly undermine US-led efforts to sanction and isolate Russia, and to limit inflation caused in part by rising energy prices. Price said it is time to “make sure” the relationship is “serving our national security interests.”
The remarks follow calls by various members of Congress for a “freeze” on cooperation with Saudi Arabia. A day prior to Biden’s remarks, Senator Bob Menendez, Chairman of the Senate Foreign Relations Committee, said the US should immediately freeze all cooperation with Saudi Arabia, “including any arms sales and security cooperation beyond what is absolutely necessary to defend U.S. personnel and interests.” Two other Democratic senators introduced legislative bills that would halt arms sales to Saudi Arabia for one year. Another proposal called for the removal of troops and missile defense systems from Saudi Arabia and the UAE within 90 days.
Conflicting accounts of the decision highlight Saudi-US drift
According to various sources, citing anonymous US officials, the decision by OPEC+ last week directly violated an agreement reached between Biden and Crown Prince Mohammed Bin Salman during his visit to Saudi Arabia in July, according to which Riyadh agreed not to cut production further. With only weeks remaining until the mid-term elections, the timing of the OPEC+ decision is particularly sensitive and potentially damaging to President Biden and the Democratic Party as inflationary and economic concerns remain a key election issue among voters.
For their part, Saudi Arabia defended the decision to cut production rates, citing concerns that prices may otherwise fall to dangerous levels. A statement by the Saudi Foreign Ministry said the criticism was “not based on facts” and that the decision was adopted through consensus to curb market volatility and stabilize supply and demand. Rejecting US claims that the decision served Russia’s interests, the statement also added that the production cut was “purely economic”.
Consequences to be specified amidst concerns over Chinese and Russian influence
The administration has not specified what measures may be taken in response to the OPEC+ decision last week with Biden – as reported above – explicitly refraining from discussing what steps, if any, will be taken in response. Regardless, any significant retaliatory moves are unlikely before the mid-term elections on 8 November. As demonstrated by the legislative responses discussed this week, any measures after that will most likely include a reduction or freeze in strategic arms sales and, possibly, the removal of anti-missile systems currently deployed on Saudi and UAE territory.
The discussed removal of US troops constitutes another potential move, however, given the assessed need to maintain a deterrent posture in the region to contain Iran, such assets would most likely be redeployed to neighboring countries as opposed to being withdrawn completely. A symbolic repositioning of assets combined with a conditional freeze on arms sales remains a plausible ‘middle way’ that negotiates the need to maintain a strong regional posture while sending desired messages to Saudi Arabia and the UAE.
Such moves are not without political costs however. Citing concerns that rivals like China and Russia will view this as an opportunity to expand strategic ties with the Gulf States – and further limit the US’ status in the region – several republican senators and other observers have expressed opposition to the discussed measures. To recall, in 2014 both Saudi Arabia and UAE purchased Chinese-made CH-4 UAVs which have since been extensively used in Yemen, and discussions about further Chinese arms sales to the Gulf are frequently reported.
Over the previous year, reports also circulated about what US intelligence described as China’s intent to establish a ‘secret’ military base in the UAE, however, the project was later reportedly abandoned following US pressure. Related concerns exist that current economic relations between the Gulf States and Russia will expand to the realm of strategic and security ties, with both the UAE and Saudi Arabia previously expressing interest in purchasing Russian arms technology, including the S-300 missile system.
Biden set to revert to conditional approach to Saudi-US ties
While certainly forming a strategic consideration for the US, such concerns should not be exaggerated and there are no indications either China or Russia retains the intent or capability to replace the US as the pre-eminent strategic security partner in the Gulf region. Chinese arms sales remain minuscule in comparison to the US and there is no evidence of significant intent in Beijing to expand its strategic role in the region, which remains focused on economic and trade interests. Meanwhile, the poor performance of Russian arms in Ukraine is set to significantly undermine its credibility as a reliable arms exporter. Both China and Russia also retain close and growing ties with Iran, which understandably imposes limitations on any future ties with the GCC countries.
The limitations of China and Russia’s influence means the US will most likely retain significant leverage in the region in the foreseeable future. After gradually adopting a more conciliatory (and ultimately unsuccessful) approach towards Riyadh since the start of the war, the Biden administration can therefore afford to revert to the more conditional policy that defined its engagement with Saudi Arabia during the first year of Biden’s presidency.
Threat of consequences follow expiration of Yemen truce
While a strategic break in relations remains premature, the associated implications for US-Saudi relations are nonetheless negative and the assessed strategic drift between the two sides can be expected to widen. The implications for security dynamics in the Gulf and the wider region remain to be seen, understandably depending on what measures the administration takes moving forward. However, the threat of “consequences” comes at a delicate time for both the UAE and Saudi Arabia.
On 2 October, a six-month truce in Yemen expired as the UN failed to negotiate an extension with the Houthi Movement. The period witnessed a significant reduction in hostilities inside Yemen and cross-border operations targeting the Saudi and UAE mainland. The April truce was precipitated by a significant increase in the range and precision of Houthi-linked strikes that underscored the movement’s expanding capability to target strategic assets, including oil refineries, water desalination facilities, and civilian targets, inside Saudi Arabia.
A series of strikes targeting Abu Dhabi in January further underscored the intent to target the UAE in response to its enduring support for the Giant Brigades and other factions affiliated with the Southern Transitional Council. The subsequent truce was assessed to have been agreed partially out of Saudi and UAE intent to reduce the outlook of future attacks through diplomatic, rather than military efforts. Notably, the truce was also precipitated by calls in Riyadh and Abu Dhabi for greater US support in the form of weapons sales amidst concerns about Houthi capabilities.
So far, cross-border strikes remain absent, and the expiration of the truce has not precipitated an immediate renewal of long-range attacks. However, the near-term outlook for a resumption is understandably elevated and would plausibly increase US leverage should a decision to freeze future sales or redeploy assets be made by the administration.