The US, the Middle East: Line in the sand
Also: Europe, Rusia, China, Iran, the Philippines, and Venezuela.
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UNITED STATES. MIDDLE EAST. Line in the sand
The deaths of three US personnel raise more questions for Washington.
At least three soldiers were killed and over 30 injured after a drone strike on an outpost in Jordan on Sunday. An Iran-backed militia claimed responsibility. Questions were raised on US anti-drone defences. Joe Biden vowed to respond.
INTELLIGENCE. Whether directed by Tehran or not, the strikes complicate US planning in Iraq, where talks have begun on a withdrawal after 20 years. They also complicate counter-terrorism operations in Syria, and support for Jordan’s counter-narcotics campaign (Jordan has recently attacked captagon smugglers inside Syria, some with alleged links to the regime in Damascus). The strikes will also pressure the US to decide whether to escalate directly against Iran.
FOR BUSINESS. Biden’s response during an election year could determine whether this becomes his Benghazi or marks a turnaround. The US’s Middle East deployments are unpopular, but not as much as suggestions of US impotence. Iran has operated just below the point of escalation so far, but US casualties could cross the line. A direct response would not just be a problem for Jordan but other Sunni US allies like Saudi Arabia, not to mention Israel.
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EUROPE. RUSSIA. Head in the sand
The continent needs a little more bite and a little less bark.
Donald Trump, Volodymyr Zelensky and Dimitry Medvedev made separate references to World War III over the weekend. Britain's army chief said civilians should prepare for a potential war, following similar calls from Sweden a week earlier.
INTELLIGENCE. Alarmist talk has made headlines but will not make Europe stronger against the Russian threat, real or perceived. And while NATO’s latest exercises signal resolve, as do discussions in the Baltics for a new defensive line, only a dramatic increase in spending from Europe’s heavyweights, especially Germany, will make a difference. Despite Berlin’s 2022 ‘Zeitenwende’, longstanding problems continue with budgets, equipment, and personnel.
FOR BUSINESS. Recent threats that a US under Trump won’t come to Europe’s rescue (and vice versa) make the case for European “strategic autonomy” more urgent. A similar urgency applies to Europe’s energy insecurity. Joe Biden on Friday paused new LNG export approvals until after the November election. Tensions are escalating in the Middle East, including hits to oil carriers in the Red Sea. Russia on Saturday offered to sell gas again to Europe directly.
CHINA. IRAN. Strait talk
Beijing is unhappy with the Houthis, and their supporters.
China called on Yemen's Houthi militants to cease attacks in the Red Sea, following reports of Beijing placing pressure on Tehran. The US asked China on Saturday to intervene, according to a readout of backchannel talks in Bangkok.
INTELLIGENCE. It is unclear how involved Tehran is in the Houthis’ provocations. Iran has given arms, but the Houthis have as much reason to be cross with Iran as with Israel – their ostensible target. Since Iran’s China-brokered rapprochement with Saudi Arabia last year, a peace deal for Yemen has been under negotiation. The Houthis are said to have been unhappy with how talks were proceeding. Putting pressure on shipping is their way to boost leverage.
FOR BUSINESS. By hitting the Europe-China Red Sea route, the Houthis hurt Beijing more than anyone. In turn, they also hurt Tehran, whose regional tightrope walk requires a neutral China. In this sense, further Chinese pressure on Iran may only embolden the Houthis (in much the same way that spasmodic Western strikes have). To calm the Red Sea, China may need to instead weigh directly into Yemeni talks, which could see the Houthis recognised as a state.
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CHINA. THE PHILIPPINES. Reef knot
Strange manoeuvres at the Second Thomas Shoal.
Beijing said Saturday it had made "temporary special arrangements" for Manila to resupply a grounded ship serving as an outpost in the South China Sea. Philippine President Ferdinand Marcos Jr arrived for talks in Hanoi on Monday.
INTELLIGENCE. Following talks with the US on Saturday and navigating a delicate balance between its economic and security interests, China has stepped back from confronting the Philippines at the Second Thomas Shoal. Allowing an airlifted resupply (China’s coastguard has blocked Filipino ships) will ease tensions as Marcos visits Vietnam, another South China Sea claimant, and Washington announces its first “2+2” policy talks with Manila for March.
FOR BUSINESS. China’s “special arrangements” appear to be a fudge. Beijing gets to retain its overall posture on the South China Sea while buying time. Beijing will hope Marcos’s domestic travails will moderate his otherwise assertive foreign policy. Pro and anti-government demonstrations filled the streets on Sunday. Marcos has been lampooned for using a military helicopter to attend a Coldplay concert. An Islamic insurgency continues to rage in the south.
VENEZUELA. Caracas a snook
Nicolas Maduro thumbs his nose at US sanction threats.
The US said Saturday it would "review" sanctions relief after Venezuela’s highest court blocked the opposition from elections in June. President Nicolas Maduro said an alleged coup plot had left opposition talks "mortally wounded".
INTELLIGENCE. Maduro is acting as if US sanctions won’t be reapplied on Venezuela’s oil sector. He is probably right. Not only does the need for Venezuelan supply outweigh human rights and democracy concerns, but its cooperation on migrant returns is something the White House must maintain as it seeks to negotiate a border deal with the Republicans. This will weaken US influence in the long term, but Biden will hope that can wait until after November.
FOR BUSINESS. The US is not the only player that needs Venezuelan energy to flow. Trinidad and Tobago last week said it had begun talks with European countries about supplying LNG from its joint Dragon gas field with Venezuela. And the flow of Venezuelan energy will also (it's hoped) reduce the risk of Maduro’s threatened invasion of Guyana, home to enormous reserves and many of the same Western companies operating in an unsanctioned Caracas.