Talos Regional Snapshot – 3 November 2022

Nov 3, 2022



Protests continue despite IRGC warning and public trials
The nationwide unrest initially triggered by the death of Masha Amini continued for the seventh consecutive week despite a warning from the head of the Islamic Revolutionary Guard Corps (IRGC) that 29 October would be the “last day” of the protests. Speaking at a funeral ceremony to commemorate the victims of the Shiraz terrorist attacks last week, Maj. Gen Hossein Salami ordered the protesters to stay home, prompting concerns about an escalation in the government’s repression. The statement was widely interpreted as an ultimatum by the government; however the immediate effects were limited as protests escalated in several cities and university campuses, repudiating the authority of the IRGC.

In response, security crackdowns were reportedly intensified, with Riot Police and other law enforcement targeting protesters at various universities across the country on 31 October and 1 November. On 1 November, the Riot Police and the paramilitary Basij Forces were also reported to have opened fire in a district of western Tehran, reportedly firing into residential buildings with live ammunition. According to human rights organizations and other sources, at least 270 individuals, including 39 children, have been killed since the start of the protests however casualty figures remain difficult to verify amidst standing reporting challenges.

More than 14 thousand have also been arrested and on 1 November the government announced plans to hold public trials for more than a thousand individuals in Tehran. State-linked sources claimed the trials will target individuals who have played a “central role” in the protests. Chief of the Judiciary Gholam-Hossein Mohseni Ejei pledged to punish “those who intend to confront and subvert the regime” and who are “dependent on foreigners”, reiterating a long-standing claim that the protesters enjoy foreign support.

Iran warns Germany and the EU over IRGC designation
In a related development, the spokesperson for the Iranian Foreign Ministry Nasser Kanaani warned Germany against designating the Islamic Revolutionary Guard Corps (IRGC) as a terrorist organization. The day before, German Foreign Minister Annalena Baerbock said Berlin and the EU are examining whether to enlist the IRGC over its role in the suppression of protesters. Earlier this month, Canada followed the United States and Saudi Arabia in designating the IRGC as an FTO, prompting the EU and some member states to consider similar steps.

In his remarks on 31 October, Kanaani said such steps are “illegal” and warned Germany and other countries against “non-constructive” actions. It should be noted that Iran recently accused Germany of coordinating anti-government protests, including through uncorroborated accusations that the German embassy in Tehran is acting as a coordination center for the protests. So far, such accusations have not translated into hostilities affecting German diplomatic interests, but the outlook for reactions by Iranian-affiliated groups will be monitored, especially if the EU and Germany proceed with the IRGC designations.

IRGC seized vessel in Persian Gulf
On 1 November, according to state-linked sources citing local officials, the IRGC Navy seized a foreign vessel carrying 11 million liters of “smuggled fuel” in the Persian Gulf. The nationality of the vessel and crew were not specified, but the Chief of the Judiciary in Hormozgan province said the operation “dealt a serious blow” to organized fuel smuggling networks. Further details will be provided as available, but in recent years the IRGC has intensified efforts to target vessels involved in fuel smuggling operations off the southern coast of the country. The quantity of fuel seized in the latest operation however is significantly larger than normal.


Repatriation of Lebanese refugees commences
On 26 October, some 750 refugees returned to Syria from Lebanon as part of an (allegedly) voluntary repatriation scheme coordinated between the two countries. The group was the first batch under a program coordinated by Lebanon’s General Security Agency, which is responsible for securing the country’s borders, and in accordance with a pledge by former President Michel Aoun to start the repatriation of Syrian refugees which number more than 800 thousand.

The United Nations is not involved in the program and human rights groups have expressed concerns about coercion, despite claims those returning are volunteers. Other concerns raised by humanitarian groups revolve around standing security issues and the uncertainty facing returnees upon their arrival. According to Amnesty International, past returnees have also been subjected to rights violations and harrassment by authorities inside government-controlled areas.


Multiple civilian casualties in Baghdad explosion
On the evening of 29 October, at least nine civilians were killed and several wounded when a gas tanker truck detonated outside a football stadium in the Adhamiyah district of Baghdad city. Despite limited reports of a suspected terrorist attack, the Baghdad Operations Command and Security Media Cells attributed the explosion to an accident, with a subsequent investigation showing no traces of explosives being involved. Read the full report (available to subscribers).

New Prime Minister to support Iran-Saudi dialogue
Speaking at his first weekly press conference since formally assuming the Prime Minister position, Muhammed Shia al-Sudani expressed support for continuing the Iran-Saudi dialogue pursued by his predecessor Mustafa al-Kadhimi. Without providing further details, al-Sudani said the new government has been “asked to continue” the talks which commenced in 2021 and involved several meetings organized by and held in Baghdad. Significant progress has been lacking amidst diplomatic tension between Iran and Saudi Arabia, and the government stalemate in Baghdad during 2022, however cautious optimism is in effect that the formation of a new government will facilitate the next round of discussions.

Finance Ministry prepares national budget for 2023
On 31 October, the Ministry of Finance announced that it commenced preparations for the 2023 national budget. A statement citing a senior official within the ministry said the budget will be sent to the Council of Ministers as soon as possible. New Minister of Finance Taif Sami earlier said passing a new budget will be one of the most important priorities of the new government.

While passing the national budget is expected to be a protracted process, the statement forms an important step as the political stalemate previously prevented the passage of a national budget for 2022, forcing the Kadhimi-led government to rely on emergency bills to ensure funding. In the near term, an increase in economically motivated protests can be expected in Baghdad and the southern region, as various groups call for budget allocations.


Turkey and Israel pledge to strengthen defense ties during visit
On 27 October, Israeli Defense Minister Benny Gantz arrived in Ankara and met with President Recep Tayyip Erdogan and his counterpart Hulusi Akar. In a significant step to mend ties, Gantz described the visit as “historic” and in a tweet announced that both sides agreed to formally strengthen defense and military ties. For his part, Akar described ongoing reconciliation efforts as a “fresh start” and said improved cooperation in “defense, defense industry, and military-security” will contribute to regional peace and security. Separate reporting said both sides gave instructions to “begin processes” to resume “working relations” within their respective ministries.

Further details about the nature of military cooperation were not provided, however, the formalization of defense and security ties marks a significant step in rapprochement efforts that commenced earlier this year. Despite lingering disagreements over the Israeli-Palestinian conflict, this forms part of a wider effort by Turkey to reassess ties in the region, including notable steps to mend ties with the UAE and Saudi Arabia. Other contributing factors include mutual intent to capitalize on the growing European demand for energy, with Israel and Turkey visibly increasing energy cooperation as a result. The potential for Iranian pushback is worth monitoring however as the strengthening of Israeli-Turkey defensive ties forms a long-term risk escalation trigger.

Central Bank raises inflation forecast for end of the year
On 27 October, Turkey’s Central Bank raised its inflation forecast for the end of 2022 from 60.4 % to 65.2%, while Governor Sahap Kavciouglu admitted that the bank has not been “very successful” in halting the increase in consumer prices. After cutting interest rates twice, annual inflation increased in September to 83.45 according to official statistics, marking the highest recorded rate in more than 24 years. Another cut was announced in October and the bank is expected to make another cut in November.

The rate of inflation remains politically significant as Erdogan continues to face criticism over pressuring the central bank to cut rates despite rising inflation. In September, the President called for inflation to drop below 10% before the end of 2022, however the continued hike in prices and forecasts is set to galvanize criticism of the government’s ability to manage the economy. The government has partially offset the political fallout of rising living costs by supporting wage increases, affordable living and higher-than-expected growth rates, and voter support for the AK Party remains solid. Regardless, popular confidence in the government’s management of the economy remains low and a continued inability to control inflation may impact Erdogan’s chances of securing another term in the 2023 Presidential elections.


Netanyahu-led coalition on the brink of election victory
According to partial and preliminary election results, the right-wing Likud-led coalition looks likely to win the Israeli parliamentary elections held on 2 November. With more than 93% percent of the votes counted on 3 November, the Likud-led coalition held a commanding lead and Benjamin Netanyahu said the party was on the brink of a significant victory. The former Prime Minister looks poised to return to the position however the post-electoral negotiations to form a new government look set to be protracted and it remains to be seen if Netanyahu can form a stable government given the persistent political divisions.

Saudi Arabia

Saudi Arabia issues threat warning of Iranian attacks
On 1 November, an article by the Wall Street Journal discussed Saudi intelligence indicating an “imminent attack” by Iran against targets in the KR-I and Saudi Arabia. The report states that, in response to the threat, US forces and “others in the Middle East” raised the alert level of their military forces. US officials acknowledged the report and cited concerns, but without officially confirming threats of an imminent attack. Absent further details, the veracity of the threat is difficult to verify yet the report has generated significant attention. Regardless of its veracity, the report remains relevant and may well see precautionary security measures over the near term in the region. Further context is provided in the full report. 

Saudi Arabia and China to expand ties according to foreign ministers
In a virtual meeting held on 28 October, the Foreign Ministers of China and Saudi Arabia agreed to expand cooperation in various fields. While details were limited, official readouts indicated the meeting focused on energy cooperation, with China expressing support for Saudi Arabia’s pursuit of an “independent” energy policy as part of the OPEC+. The meeting also reportedly discussed prospects for establishing a ‘regional hub’ for Chinese manufacturing and ways to safeguard regional peace and security. The 28 October meeting notably followed a call between the energy ministers of both countries earlier in October, with both sides similarly agreeing to support “stability” in international oil markets.

Attended by Prince Faisal Bin Farhan and Chinese counterpart Wang Yi, the meeting on 28 October was held as part of the Saudi Arabia-China High-level Joint Committee which was set up in 2016 to coordinate and expand bilateral ties. So far, relations remain defined by economic and trade ties, with China recently increasing its exports of Saudi oil and plausibly looking to capitalize on assessed friction in the US-Saudi partnership. At the same time, China’s simultaneous efforts to strengthen ties with Iran form a limiting factor and underscores the transactional and pragmatic nature of China’s engagement in the region.


US and UAE sign green energy agreement
On 1 November, US State Secretary Anthony Blinken announced that the US and UAE agreed to sign a memorandum of understanding (MoU) to spend $100 billion by 2035 on clean energy projects. The MoU was signed in Abu Dhabi and was hailed by Blinken as an important step in “joint efforts to accelerate our collective movement toward clean energy.” The so-called UAE-US Partnership for Accelerating Clean Energy stipulates that the US will provide “technical, project management, and funding assistance for commercially and environmentally sustainable energy projects.” The timing of the MoU is significant in light of diplomatic tensions between the US and OPEC+ over oil production cuts, with Abu Dhabi recently reiterating its support for the decision taken by OPEC+ in October.


US delegation visits Hahramaut province following Houthi UAV strike
According to Iranian and Houthi-linked channels, a US military delegation visited Hadhramaut province this week to meet with local government officials. Few details were provided but the visit follows a previously discussed UAV strike impacting near a Greek oil tanker in the Dabba port located near the provincial capital Mukalla. The strike was conducted by the Houthi Movement as a warning to international companies and foreign countries, including the US, UAE, and Saudi Arabia, against “looting” Yemen’s natural resources. The visit this week was also accompanied by unconfirmed reports of the arrival of US troops in the province, which Iranian-linked sources described as part of an ongoing effort to “control energy resources.”

Separately, Iranian-linked sources also discussed the detonation of an IED near an oilfield located in the province and allegedly operated by Canadian company Calvalley. Four individuals employed as guards at the site were reportedly killed and several others were wounded as a result. The Houthi Movement is suspected of involvement, however the attack was not independently corroborated. It should also be noted that Calvalley suspended operations in the country in January 2022, citing deteriorating security conditions, and the company’s involvement in the oil concession, if any, is currently unclear. Regardless of their veracity, the reports corroborate assessed elevated threat atmospherics against oil interests in Yemen following the expiration of the truce in early October.

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