TEHRAN(Bazaar) – William O. Beeman, Professor Emeritus of University of Minnesota, says Iran's relations with Saudi Arabia have been improving over the past year.
Following is the text of the Bazaar interview with Professor William O. Beeman.
Bazaar: While it was said that the American policy regarding the Persian Gulf has changed due to the containment of China, we are witnessing the importance of the region’s oil after the war in Ukraine. Do you agree with this argument?
Beeman: Yes, (Persian) Gulf oil is being shipped to China in much greater quantity, but Russian oil is also being sold to China at a discount. In March,
Iran's exports to China were estimated at 700,000 to 900,000 barrels per day (bpd) according to data and consultancy firm calculations. Russia has undercut the world price by a great deal, and this seems to have reduced Iran's ability to export to China.
Bazaar: Biden's trip to the region is an attempt to find a way to reduce oil prices with Saudi’s help. Will this happen?
Beeman: There is no question that Russia's exports to China have undercut the oil market, which means that Saudi Arabia (and Iran and other (Persian) Gulf countries) are selling less oil to China. This is undoubtedly one of the topics that will be discussed in Biden's trip to Saudi Arabia. There are many mechanisms that would accomplish this. The easiest would be for Saudi Arabia to increase oil production, effectively lowering the price of oil. However, China is eager to "bring Iran under its sphere of influence." And one way to do this is to cement regular purchase of Iranian oil. Since Iran has few other markets, this is an effective political strategy on China's part.
Bazaar: The United States is trying to encourage Saudi Arabia to stage a coup against Russia by withdrawing from the OPEC+ agreement and subsequently increasing oil production to improve its price in Western countries. Is this happening?
Beeman: Yes, The United States wants Saudi Arabia to help undercut Russian oil sales as a way to cripple the Russian economy, and concomitantly lower oil prices world-wide. It is not clear that Saudi Arabia will be willing to do this. However, prices of crude oil have dropped in advance of this meeting, because buyers on the futures market are expecting that something will be done.
Bazaar: What effect will Biden's trip to the region has on nuclear negotiations with Iran?
Beeman: We just saw that Israel has essentially reversed an earlier position where they supported the JCPOA. Their current position, largely as an appeal to the public in a time of real political turmoil, is that Iran's nuclear program should be curtailed by a combination of economic sanctions and military operations--this is the Netanyahu position. Biden continues to assert that diplomacy is the only path to stability in the region. With Israeli domestic politics so unstable, it is difficult to assess the significance of the Israeli position. Frankly, I believe it to be a posture for domestic purposes, as it was when Netanyahu was in power. It is not inconceivable that Netanyahu might once again become prime minister, and I believe all Israeli politicians know this, and are hedging their bets on Iran. Being "soft" on Iran from the standpoint of Israeli politics is a formula for defeat in upcoming elections.
Bazaar: Will this trip affect the negotiations between Iran and Saudi Arabia?
Beeman: Actually, Iran's relations with Saudi Arabia have been improving over the past year. It is not clear what this means in terms of the United States' dealings with Iran. The Trump administration was trying to discourage closer relations between Iran and Saudi Arabia (and the other (Persian) Gulf States). There is no indication that Biden is continuing this extreme policy. But I would be surprised if Biden were to encourage the Saudi Arabian government to move even closer to Iran. However, Biden and his team might see a possibility that improved Saudi Arabian-Iranian relations could improve chances of finding a way to persuade Iran to compromise on the JCPOA.
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