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Since that September 11 Kerry-Abdullah meeting (curious date to pick, given the climate of suspicion that the Bush family is covering up involvement of the Saudis in or around the events of September 11, 2001), the Saudis have a new ageing King, Absolute Monarch and Custodian of the Two Holy Mosques, King Salman, replacing the since deceased old ageing King, Abdullah. However, the Oil Minister remains unchanged—79-year-old Ali al-Naimi. It was al-Naimi who reportedly saw the golden opportunity in the Kerry proposal to use the chance to at the same time kill off the growing market challenge from the rising output of the unconventional USA shale oil industry. Al-Naimi has said repeatedly that he is determined to eliminate the US shale oil “disturbance” to Saudi domination of world oil markets. Not only are the Saudis unhappy with the US shale oil intrusion on their oily Kingdom. They are more than upset with the recent deal the Obama Administration made with Iran that will likely lead in several months to lifting Iran economic sanctions. In fact the Saudis are beside themselves with rage against Washington, so much so that they have openly admitted an alliance with arch foe, Israel, to combat what they see as the Iran growing dominance in the region—in Syria, in Lebanon, in Iraq.

This has all added up to an iron Saudi determination, aided by close Gulf Arab allies, to further crash oil prices until the expected wave of shale oil company bankruptcies—that was halted in January by Washington and Wall Street manipulations—finishes off the US shale oil competition. That day may come soon, but with unintended consequences for the entire global financial system at a time such consequences can ill be afforded. According to a recent report by Wall Street bank, Morgan Stanley, a major player in crude oil markets, OPEC oil producers have been aggressively increasing oil supply on the already glutted world market with no hint of a letup. In its report Morgan Stanley noted with visible alarm, “OPEC has added 1.5 million barrels/day to global supply in the last four months alone…the oil market is currently 800,000 barrels/day oversupplied. This suggests that the current oversupply in the oil market is fully due to OPEC’s production increase since February alone.” The Wall Street bank report adds the disconcerting note, “We anticipated that OPEC would not cut, but we didn’t foresee such a sharp increase.” In short, Washington has completely lost its strategic leverage over Saudi Arabia, a Kingdom that had been considered a Washington vassal ever since FDR’s deal to bring US oil majors in on an exclusive basis in 1945.

That breakdown in US-Saudi communication adds a new dimension to the recent June 18 high-level visit to St. Petersburg by Muhammad bin Salman, the Saudi Deputy Crown Prince and Defense Minister and son of King Salman, to meet President Vladimir Putin. The meeting was carefully prepared by both sides as the two discussed up to $10 billion of trade deals including Russian construction of peaceful nuclear power reactors in the Kingdom and supplying of advanced Russian military equipment and Saudi investment in Russia in agriculture, medicine, logistics, retail and real estate. Saudi Arabia today is the world’s largest oil producer and Russia a close second. A Saudi-Russian alliance on whatever level was hardly in the strategy book of the Washington State Department planners.…Oh shit! Now that OPEC oil glut the Saudis have created has cracked the shaky US effort to push oil prices back up. The price fall is being further fueled by fears that the Iran deal will add even more to the glut, and that the world’s second largest oil importer, China, may cut back imports or at least not increase them as their economy slows down. The oil market time bomb detonated in the last week of June. The US price of WTI oil went from $60 a barrel then, a level at which at least many shale oil producers can stay afloat a bit longer, to $49 on July 29, a drop of more than 18% in four weeks, tendency down. Morgan Stanley sounded loud alarm bells, stating that if the trend of recent weeks continues, “this downturn would be more severe than that in 1986. As there was no sharp downturn in the 15 years before that, the current downturn could be the worst of the last 45+ years. If this were to be the case, there would be nothing in our experience that would be a guide to the next phases of this cycle…In fact, there may be nothing in analyzable history.”

October is the next key point for bank decisions to roll-over US shale company loans or to keep extending credit on the (until now) hope that prices will slowly recover. If as strongly hinted, the Federal Reserve hikes US interest rates in September for the first time in the eight years since the global financial crisis erupted in the US real estate market in 2007, the highly-indebted US shale oil producers face disaster of a new scale. Until the past few weeks the volume of US shale oil production has remained at the maximum as shale producers desperately try to maximize cash flow, ironically, laying the seeds of the oil glut globally that will be their demise. The reason US shale oil companies have been able to continue in business since last November and not declare bankruptcy is the ongoing Federal Reserve zero interest rate policy that leads banks and other investors to look for higher interest rates in the so-called “High Yield” bond market. Back in the 1980’s when they were first created by Michael Millken and his fraudsters at Drexel Burnham Lambert, Wall Street appropriately called them “junk bonds” because when times got bad, like now for Shale companies, they turned into junk. A recent UBS bank report states, “the overall High-Yield market has doubled in size; sectors that witnessed more buoyant issuance in recent years, like energy and metals mining, have seen debt outstanding triple or quadruple.”

Assuming that the most recent downturn in WTI oil prices continues week after week into October, there well could be a panic run to sell billions of dollars of those High-Yield, high-risk junk bonds. As one investment analyst notes, “when the retail crowd finally does head for the exits en masse, fund managers will be forced to come face to face with illiquid secondary corporate credit markets where a lack of market depth…has the potential to spark a fire sale.” The problem is that this time, unlike in 2008, the Federal Reserve has no room to act. Interest rates are already near zero and the Fed has bought trillions of dollars of bank bad debt to prevent a chain-reaction US bank panic. One option that is not being discussed at all in Washington would be for Congress to repeal the disastrous 1913 Federal Reserve Act that gave control of our nation’s money to a gang of private bankers, and to create a public National Bank, owned completely by the United States Government, that could issue credit and sell Federal debt without the intermediaries of corrupt Wall Street bankers as the Constitution intended. At the same time they could completely nationalize the six or seven “Too Big To Fail” banks behind the entire financial mess that is destroying the foundations of the United States and by extension of the role of the dollar as world reserve currency, of most of the world.

Much of the subsequent commentary has focused on why the French were coming to the aid of the Israelis in blocking the interim agreement that Netanyahu has denounced in apocalyptic terms. But France’s interest in undercutting the deal can perhaps best be understood by factoring in the Saudi money. Indeed, the logic behind the behind-the-scenes Saudi-Israeli alliance has been that the two former adversaries now view their interests as mostly aligning, especially their contempt for Iran’s Shiite government and its influence extending along the Shiite Crescent from Tehran through Baghdad and Damascus to Beirut. Israel and Saudi Arabia agree that Iran is the greatest threat to their regional interests. Both countries have indicated that they want the Iranian-backed government in Syria to be overthrown even if that means it will be replaced by Saudi-backed Sunni jihadists linked to al-Qaeda. [See Consortiumnews.com’s “Israel Sides with Syrian Jihadists.”]

Israel and Saudi Arabia also took the same side on the Egyptian military coup d’etat which ousted elected President Mohamed Morsi, a leader of the Muslim Brotherhood. Though the Muslim Brotherhood is Sunni – like the Saudis – it represents a populist movement that the Saudi monarchy considers a threat to its anti-democratic structure. Israel views the Muslim Brotherhood as sympathetic to Hamas in Gaza. But what makes the Saudi-Israeli alliance so influential is the complementary strengths of the two countries. Israel has extraordinary skills at lobbying and propaganda, especially in influencing Official Washington and Capitol Hill. Saudi Arabia has vast financial resources that can turn the heads of defense officials in Paris, oil men in Houston or investment bankers on Wall Street. Together these strengths can make the negotiation of any good-faith compromise with Iran or Syria difficult, if not impossible. Between Netanyahu pulling the strings of his political and media marionettes in Washington and the Saudis manipulating the French government and others with financial inducements, it will take toughness and savvy for the Obama administration to guide the process to a peaceful resolution. And, toughness and savvy are not attributes that the administration is known to have in great supply.

Enter the strategic importance of neighboring Bahrain. Historically, all the lands from Basra in southern Iraq to the peninsula of Musandam, in Oman — traditional trade posts between Europe and India — were known as Bahrain ("between two seas"). Tehran could easily use neighboring Bahrain to infiltrate Al Sharqiyya, detach it from Riyadh's control, and configure a "Greater Bahrain" allied with Iran. That's the crux of the narrative peddled by petrodollar-controlled media, the proverbial Western "experts", and incessantly parroted in the Beltway.  

There's no question Iranian hardliners cherish the possibility of a perpetual Bahraini thorn on Riyadh's side. That would imply weaponizing a popular revolution in Al Sharqiyya.  But the fact is not even Nimr al-Nimr was in favor of a secession of Al Sharqiyya.  And that's also the view of the Rouhani administration in Tehran. Whether disgruntled youth across Al Sharqiyya will finally have had enough with the beheading of al-Nimr it's another story; it may open a Pandora's box that will not exactly displease the IRGC in Tehran.   But the heart of the matter is that Team Rouhani perfectly understands the developing Southwest Asia chapter of the New Great Game, featuring the re-emergence of Iran as a regional superpower; all of the House of Saud's moves, from hopelessly inept to major strategic blunder, betray utter desperation with the end of the old order.  

That spans everything from an unwinnable war (Yemen) to a blatant provocation (the beheading of al-Nimr) and a non sequitur such as the new Islamic 34-nation anti-terror coalition which most alleged members didn't even know they were a part of.  The supreme House of Saud obsession rules, drenched in fear and loathing: the Iranian "threat". Riyadh, which is clueless on how to play geopolitical chess — or backgammon — will keep insisting on the oil war, as it cannot even contemplate a military confrontation with Tehran. And everything will be on hold, waiting for the next tenant of 1600 Pennsylvania Avenue; will he/she be tempted to pivot back to Southwest Asia, and cling to the old order (not likely, as Washington relies on becoming independent from Saudi oil)? Or will the House of Saud be left to its own — puny — devices among the shark-infested waters of hardcore geopolitics?

Not surprisingly, many members of the Saudi Royal Family are concerned about the situation which has come about after the new King Salman bin Abdulaziz Al Saud came to power. According to the Egyptian newspaper, the Egyptian Gazette, the changes that have occurred in the Kingdom’s foreign and domestic policy in less than 9 months of King Salman’s reign have cause a growing number of problems in both the Kingdom of Saudi Arabia and abroad. Dissatisfaction among the Saudis has risen to a new level. All of this is reflected in a letter that members of the Royal Family received from one of the younger princes. In the letter, which was widely reprinted in the world media, the anonymous monarch justifies the need for change and literally calls for a coup d’etat, which, according to the prince should by carried out by the 13 currently healthy sons of the founder of Saudi Arabia. “The King in not in a stable position and in reality the son of the King is ruling the Kingdom”, the prince wrote. He called for “the sons of Ibn Saud, from the eldest, Bandar, to the youngest, Muqrin” to urgently convene a meeting to examine the situation and see what should be done to save the Kingdom, to carry out a series of substitutions in high positions in the Kingdom of Saudi Arabia and to verify the decisions taken by members of the Saudi Arabian royal family, irrespective of which they generation belong to.

It is worth noting that the author of the letter refers to a range of reasons for which the current King Salman and his son should be removed from their posts, including their inability to lead or deal with the difficult economic situation in the country caused by the fall in oil prices, the unpopular war in Yemen, the foreign policy failures in Syria and the recent tragedy in Mecca that claimed more than 800 lives. Meanwhile the writer does not explain exactly whom he would like to see in the position of King and Crown Prince. Neither the Royal house, nor the 13 princes, to whom the letter is addressed, have since reacted. In any case, the current rulers are faced with a number of questions and problems, and the immediate future of Saudi Arabia will depend on how professionally and quickly they are able to solve them.

And the fact that there’s a growing crisis in Saudi Arabia was evident from the cuts in subsidies and bonuses that king Salman started at the beginning of this year to reduce the country’s total dependence on oil. After decades of extensive use of oil revenues to subsidize companies’ payment of generous salaries and providing enormous social benefits, falling oil prices struck Saudi Arabia at its heart. It’s enough to say that revenues from oil exports in 2015 alone dropped by half. Ultimately it’s hard to say which country suffers the most from these oil wars – Russia or Saudi Arabia, since the latter has virtually no other sectors to support the economy. Saudi economist Turki Fadaak believes that Saudi Arabia is exiting the policy of “universal welfare”, so there’s an ongoing psychological shift in the minds of the ruling elite of the state. Fadaak is convinced that the ultimate aim of king Salman’s measures is to eliminate the Saudi dependency on oil. But is it really? According to leading international experts – the answer is a resounding “no”, with all the arguments to the contrary nothing more than fantasy.

Although initially it seemed that Salman, who came to power after the death of his brother, King Abdullah, will continue his course, after assuming the throne Salman generously spent over 30 billion dollars from the budget on bonuses for civil servants, military personnel, and students. Additionally, prices for basic goods and services, including fuel, electricity and water prices were kept at extremely low levels due to government subsidies from oil revenues. However, due to falling oil prices, under the pressure of such costs the budget started to rupture. The most important thing now for the kingdom is to execute the transition from the extremely lavish social security system to a productive economy, but then the subjects of the king will be forced to cut their costs, and it looks that they do not agree with this notion. And accusations in the imminent economic collapse will go Salman’s way, so it is better for him to leave now, before protests even start.

It is curious that Saudi Arabia has been rather realistic about its budget for the year 2016, since it was based on the average price of oil keeping at the level 29 dollars per barrel. Last year, the Saudi budget deficit amounted to almost 98 billion dollars and the costs were considerably higher than it was originally planed due to bonuses for civil servants, military personnel and retirees. In 2016 the authorities decided to put up to 49 billion dollars into a special fund to provide funding for the most important projects in case oil prices drop even further. But it was Saudi Arabia back in 2014 that proposed new tactics for OPEC, that implied that there would be no cuts in the level of production, the tactics that drove oil prices to today’s levels. So we are to learn pretty soon should Riyadh choose the path of the utter and complete collapse of the kingdom, or the path of giving power to the young and pragmatic technocrats who are going to pursue a comprehensive oil policy. Either way, Saudi Arabia will be forced to put an end to the costly military adventures in Syria and Yemen as well as its confrontations with Russia and Iran.

According to Rashid Abanmy, President of the Riyadh-based Saudi Arabia Oil Policies and Strategic Expectations Center, the dramatic price collapse is being deliberately caused by the Saudis, OPEC’s largest producer. The public reason claimed is to gain new markets in a global market of weakening oil demand. The real reason, according to Abanmy, is to put pressure on Iran on her nuclear program, and on Russia to end her support for Bashar al-Assad in Syria.[2] When combined with the financial losses of Russian state natural gas sales to Ukraine and prospects of a US-instigated cutoff of the transit of Russian gas to the huge EU market this winter as EU stockpiles become low, the pressure on oil prices hits Moscow doubly. More than 50% of Russian state revenue comes from its export sales of oil and gas.

The details are emerging of a new secret and quite stupid Saudi-US deal on Syria and the so-called IS. It involves oil and gas control of the entire region and the weakening of Russia and Iran by Saudi Arabian flooding the world market with cheap oil. Details were concluded in the September meeting by US Secretary of State John Kerry and the Saudi King. The unintended consequence will be to push Russia even faster to turn east to China and Eurasia. One of the weirdest anomalies of the recent NATO bombing campaign, allegedly against the ISIS or IS or ISIL or Daash, depending on your preference, is the fact that with major war raging in the world’s richest oil region, the price of crude oil has been dropping, dramatically so. Since June when ISIS suddenly captured the oil-rich region of Iraq around Mosul and Kirkuk, the benchmark Brent price of crude oil dropped some 20% from $112 to about $88. World daily demand for oil has not dropped by 20% however. China oil demand has not fallen 20% nor has US domestic shale oil stock risen by 21%.

One of the untold stories of the recent Syria-driven diplomatic flurry is how Moscow has been silently working on mollifying both Saudi Arabia and Turkey behind the scenes. That was already the case when the foreign ministers of US, Russia, Turkey and Saudi Arabia met before Vienna.Vienna was crucial not only because Iran was on the table for the first time but also because of the presence of Egypt – incidentally, fresh from recent discovery of new oil reserves, and engaging in a reinforced relationship with Russia.The absolute key point was this paragraph included in Vienna’s final declaration: “This political process will be Syrian-led and Syrian-owned, and the Syrian people will decide the future of Syria.”It’s not by accident that only Russian and Iranian media chose to give the paragraph the appropriate relevance. Because this meant the actual death of the regime change obsession, much to the distress of US neocons, Erdogan and the House of Saud.

The main point is the death of the regime change option, brought about by Moscow. And that leaves Putin free to further project his extremely elaborate strategy. He called Erdogan on Wednesday to congratulate him on his and the AKP’s election landslide. This means that now Moscow clearly has someone to talk to in Ankara. Not only about Syria. But also about gas.Putin and Erdogan will have a crucial energy-related meeting at the G20 summit on November 15 in Turkey; and there’s an upcoming visit by Erdogan to Moscow. Bets are on that the Turk Stream agreement will be – finally – reached before the end of the year. And on northern Syria, Erdogan has been forced to admit by Russian facts on the ground and skies that his no-fly zone scheme will never fly.

That leaves us with the much larger problem: the House of Saud.There’s a wall of silence surrounding the number one reason for Saudi Arabia to bomb and invade Yemen, and that is to exploit Yemen’s virgin oil lands, side by side with Israel – no less. Not to mention the strategic foolishness of picking a fight with redoubtable warriors such as the Houthis, which have sowed panic amidst the pathetic, mercenary-crammed Saudi army.Riyadh, following its American reflexes, even resorted to recruiting Academi – formerly Blackwater - to round up the usual mercenary suspects as far away as Colombia.It was also suspected from the beginning, but now it's a done deal that the responsible actor for the costly Yemen military disaster is none other than Prince Mohammad bin Salman, the King’s son who, crucially, was sent by his father to meet Putin face-to-face.

Meanwhile, Qatar will keep crying because it was counting on Syria as a destination point for its much-coveted gas pipeline to serve European customers, or at least as a key transit hub on the way to Turkey.Iran on the other hand needed both Iraq and Syria for the rival Iran-Iraq-Syria gas pipeline because Tehran could not rely on Ankara while it was under US sanctions (this will now change, fast). The point is Iranian gas won’t replace Gazprom as a major source for the EU anytime soon. If it ever did, or course, that would be a savage blow to Russia.

In oil terms, Russia and the Saudis are natural allies. Saudi Arabia cannot export natural gas; Qatar can. To get their finances in order – after all even the IMF knows they are on a highway to hell - the Saudis would have to cut back around ten percent of production with OPEC, in concert with Russia; the oil price would more than double. A 10 percent cutback would make a fortune for the House of Saud.So for both Moscow and Riyadh, a deal on the oil price, to be eventually pushed towards $100 a barrel, would make total economic sense. Arguably, in both cases, it might even mean a matter of national security.But it won’t be easy. OPEC’s latest report assumes a basket of crude oil to be quoted at only $55 in 2015, and to rise by $5 a year reaching $80 only by 2020. This state of affairs does not suit either Moscow or Riyadh.

Meanwhile, fomenting all sorts of wild speculation, ISIS/ISIL/Daesh still manages to collect as much as $50 million a month from selling crude from oilfields it controls across “Syraq”, according to the best Iraq-based estimates.The fact that this mini-oil caliphate is able to bring in equipment and technical experts from “abroad” to keep its energy sector running beggars belief. “Abroad” in this context means essentially Turkey – engineers plus equipment for extraction, refinement, transport and energy production.One of the reasons this is happening is that the US-led Coalition of the Dodgy Opportunists (CDO) – which includes Saudi Arabia and Turkey - is actually bombing the Syrian state energy infrastructure, not the mini oil-Caliphate domains. So we have the proverbial “international actors” in the region de facto aiding ISIS/ISIL/Daesh to sell crude to smugglers for as low as $10 a barrel.Saudis – as much as Russian intel - have noted how ISIS/ISIL/Daesh is able to take over the most advanced US equipment that takes months to master, and instead integrate it into their ops at once. This implies they must have been extensively trained. The Pentagon, meanwhile, sent and will be sending top military across “Syraq” with an overarching message: if you choose Russia we won’t help you.ISIS/ISIL/Daesh, for their part, never talks about freeing Jerusalem. It’s always about Mecca and Medina.

The perennial Saudi Foreign Minister, Prince Saud al-Faisal had lunch with US Secretary of State John Kerry at the Prince's very private luxury digs in Paris this Monday. The mystery is which kafir fluid was consumed; no doubts though in the official, harmless spin; they agreed on a nuclear-free Iran, an end to the war in Syria and a "stable" Egypt. Before the Paris bash, during the weekend, Bandar Bush was already in his trademark full gear, openly announcing to European diplomats in Riyadh that he will buy his Syria-bound weapons somewhere else, will dissociate his scheme from the CIA, and will train "his" rebels with other players, mostly France and Jordan. The Wall Street Journal has the story, which predictably has not surfaced in Arab media (90% of it controlled by different branches of the House of Saud). Even more interesting is two other pieces of information leaked by diplomats. The House of Saud wanted the US to provide them with targets to be hit inside Syria when Obama's kinetic whatever would start. Washington adamantly refused.

Better yet; Washington allegedly told Riyadh the US would not be able to defend the Shi'ite majority, oil-rich Eastern Province if the Tomahawks started flying over Syria. Imagine the horror show in Riyadh; after all, mob protection against petrodollars recycled/invested in the US economy is the basis of this dysfunctional marriage for nearly seven decades. So that should lead us to the now much hyped "independent Saudi foreign policy posture" to be implemented in relation to Washington. Don't hold your breath. As much as the House of Saud is completely paranoid regarding the Obama administration's latest moves, throwing a fit will not change the way the geopolitical winds are blowing. Iran's geopolitical ascent is inevitable. A Syrian solution is on the horizon. No one wants batshit crazy jihadis roaming free from Syria to Iraq to the wider Middle East. The Saudi spin about creating "a new security arrangement for the Arab world" is a joke - as depicted by Saudi-financed shills such as this.

The bottom line is that an angry, fearful House of Saud does not have what it takes to confront benign protector Washington. Throwing a fit - as in crying to attract attention - is for geopolitical babies. Without the US - or "the West" - who's gonna run the Saudi energy industry? PhD-deprived camels? And who's gonna sell (and maintain) those savory weapons? Who's going to defend them for smashing the true spirit of the Arab Spring, across the GCC and beyond? Perennial Foreign Minister Prince Saud is gravely ill. He will be replaced by a recently appointed deputy prime minister. Guess who? Prince Abdul Aziz bin Abdullah, the king's son. Instead of a "principled" stance against "double standards", the House of Saud move at the UN feels more like nepotism.

King Salman has been part of the ruling clique of princes for decades and is thought likely to continue the main thrusts of Saudi strategic policy, including maintaining the alliance with the United States and working towards energy market stability. During his five decades as Riyadh governor he was reputedly adept at managing the delicate balance of clerical, tribal and princely interests that determine Saudi policy, while maintaining good relations with the West.In the long term Saudi rulers have to manage the needs of a rapidly growing population plagued by structural unemployment, and an economy that remains overly dependent on oil revenue and undermined by lavish subsidies.Saudi Arabia, which holds more than a fifth of the world's crude oil, also exerts some influence over the world's 1.6 billion Muslims through its guardianship of Mecca and Medina, Islam's holiest sites.

Most senior members of the ruling al-Saud family are thought to favor similar positions on foreign and energy policy, but incoming kings have traditionally chosen to appoint new ministers to head top ministries like oil and finance. In a country where the big ministries are dominated by royals, successive kings have kept the oil portfolio reserved for commoners and insisted on maintaining substantial spare output capacity to help reduce market volatility.

The real question is this: if concern over suppression of political rights is not the real reason the U.S. is imposing new sanctions on Venezuela (perish the thought!), what is? Among the most insightful commentators on U.S. policy in Latin America is Mark Weisbrot of Just Foreign Policy. Read his excellent article for Al Jazeera on the recent Obama decree on Venezuela. In essence, Venezuela is one of the very few countries with significant oil reserves which does not submit to U.S. dictates, and this simply cannot be permitted (such countries are always at the top of the U.S. government and media list of Countries To Be Demonized). Beyond that, the popularity of Chavez and the relative improvement of Venezuela’s poor under his redistributionist policies petrifies neoliberal institutions for its ability to serve as an example; just as the Cuban economy was choked by decades of U.S. sanctions and then held up by the U.S. as a failure of Communism, subverting the Venezuelan economy is crucial to destroying this success. As Weisbrot notes, every country in the hemisphere except for the U.S. and Canada have united to oppose U.S. sanctions on Venezuela. The Community of Latin American and Caribbean States (CELAC) issued a statement in February in response to the prior round of U.S. sanctions on Venezuela that “reiterates its strong repudiation of the application of unilateral coercive measures that are contrary to international law.” This week, the chief of the Union of South American Nations (UNASUR) issued a statement announcing that “UNASUR rejects any external or internal attempt at interference that seeks to disrupt the democratic process in Venezuela.” Weisbrot compares Obama’s decree this week on Venezuela to President Reagan’s quite similar 1985 decree that Nicaragua was a national security threat to the U.S., and notes: “The Obama administration is more isolated today in Latin America than even George W. Bush’s administration was.”

If Obama and supporters want the government of Venezuela to be punished and/or toppled because they refuse to comply with U.S. dictates, they should at least be honest about their beliefs so that their true character can be seen. Pretending that any of this has to do with the U.S. Government’s anger over suppression of political opponents — when their closest allies are the world champions at that — should be too insulting of everyone’s intelligence to even be an option.

The issue is whether the United States can live with this situation or whether it must reshape it. The immediate question is whether the United States has the power to reshape it and to what extent. The American interest turns on its ability to balance local forces. If that exists, the question is whether there is any other shape that can be achieved through American power that would be superior. From my point of view, there are many different shapes that can be imagined, but few that can be achieved. The American experience in Iraq highlighted the problems with counterinsurgency or being caught in a local civil war. The idea of major intervention assumes that this time it will be different. This fits one famous definition of insanity.

A national strategy emerges over the decades and centuries. It becomes a set of national interests into which a great deal has been invested, upon which a great deal depends and upon which many are counting. Presidents inherit national strategies, and they can modify them to some extent. But the idea that a president has the power to craft a new national strategy both overstates his power and understates the power of realities crafted by all those who came before him. We are all trapped in circumstances into which we were born and choices that were made for us. The United States has an inherent interest in Ukraine and in Syria-Iraq. Whether we should have that interest is an interesting philosophical question for a late-night discussion, followed by a sunrise when we return to reality. These places reflexively matter to the United States. The American strategy is fixed: Allow powers in the region to compete and balance against each other. When that fails, intervene with as little force and risk as possible. For example, the conflict between Iran and Iraq canceled out two rising powers until the war ended. Then Iraq invaded Kuwait and threatened to overturn the balance of power in the region. The result was Desert Storm.

The American strategy is fixed: Allow powers in the region to compete and balance against each other. When that fails, intervene with as little force and risk as possible. For example, the conflict between Iran and Iraq canceled out two rising powers until the war ended. Then Iraq invaded Kuwait and threatened to overturn the balance of power in the region. The result was Desert Storm. This strategy provides a model. In the Syria-Iraq region, the initial strategy is to allow the regional powers to balance each other, while providing as little support as possible to maintain the balance of power. It is crucial to understand the balance of power in detail, and to understand what might undermine it, so that any force can be applied effectively. This is the tactical part, and it is the tactical part that can go wrong. The strategy has a logic of its own. Understanding what that strategy demands is the hard part. Some nations have lost their sovereignty by not understanding what strategy demands. France in 1940 comes to mind. For the United States, there is no threat to sovereignty, but that makes the process harder: Great powers can tend to be casual because the situation is not existential. This increases the cost of doing what is necessary. The ground where we are talking about applying this model is Syria and Iraq. Both of these central governments have lost control of the country as a whole, but each remains a force. Both countries are divided by religion, and the religions are divided internally as well. In a sense the nations have ceased to exist, and the fragments they consisted of are now smaller but more complex entities.

This strategy provides a model. In the Syria-Iraq region, the initial strategy is to allow the regional powers to balance each other, while providing as little support as possible to maintain the balance of power. It is crucial to understand the balance of power in detail, and to understand what might undermine it, so that any force can be applied effectively. This is the tactical part, and it is the tactical part that can go wrong. The strategy has a logic of its own. Understanding what that strategy demands is the hard part. Some nations have lost their sovereignty by not understanding what strategy demands. France in 1940 comes to mind. For the United States, there is no threat to sovereignty, but that makes the process harder: Great powers can tend to be casual because the situation is not existential. This increases the cost of doing what is necessary. The ground where we are talking about applying this model is Syria and Iraq. Both of these central governments have lost control of the country as a whole, but each remains a force. Both countries are divided by religion, and the religions are divided internally as well. In a sense the nations have ceased to exist, and the fragments they consisted of are now smaller but more complex entities.

There is then the special case of the Islamic State. It is special because its emergence triggered the current crisis. It is special because the brutal murder of two prisoners on video showed a particular cruelty. And it is different because its ideology is similar to that of al Qaeda, which attacked the United States. It has excited particular American passions. To counter this, I would argue that the uprising by Iraq’s Sunni community was inevitable, with its marginalization by Nouri al-Maliki’s Shiite regime in Baghdad. That it took this particularly virulent form is because the more conservative elements of the Sunni community were unable or unwilling to challenge al-Maliki. But the fragmentation of Iraq into Shiite, Sunni and Kurdish regions was well underway before the Islamic State, and jihadism was deeply embedded in the Sunni community a long time ago. Moreover, although the Islamic State is brutal, its cruelty is not unique in the region. Syrian President Bashar al Assad and others may not have killed Americans or uploaded killings to YouTube, but their history of ghastly acts is comparable. Finally, the Islamic State — engaged in war with everyone around it — is much less dangerous to the United States than a small group with time on its hands, planning an attack. In any event, if the Islamic State did not exist, the threat to the United States from jihadist groups in Yemen or Libya or somewhere inside the United States would remain.

The issue is whether the United States can live with this situation or whether it must reshape it. The immediate question is whether the United States has the power to reshape it and to what extent. The American interest turns on its ability to balance local forces. If that exists, the question is whether there is any other shape that can be achieved through American power that would be superior. From my point of view, there are many different shapes that can be imagined, but few that can be achieved. The American experience in Iraq highlighted the problems with counterinsurgency or being caught in a local civil war. The idea of major intervention assumes that this time it will be different. This fits one famous definition of insanity.

Because the Islamic State operates to some extent as a conventional military force, it is vulnerable to U.S. air power. The use of air power against conventional forces that lack anti-aircraft missiles is a useful gambit. It shows that the United States is doing something, while taking little risk, assuming that the Islamic State really does not have anti-aircraft missiles. But it accomplishes little. The Islamic State will disperse its forces, denying conventional aircraft a target. Attempting to defeat the Islamic State by distinguishing its supporters from other Sunni groups and killing them will founder at the first step. The problem of counterinsurgency is identifying the insurgent. There is no reason not to bomb the Islamic State’s forces and leaders. They certainly deserve it. But there should be no illusion that bombing them will force them to capitulate or mend their ways. They are now part of the fabric of the Sunni community, and only the Sunni community can root them out. Identifying Sunnis who are anti-Islamic State and supplying them with weapons is a much better idea. It is the balance-of-power strategy that the United States follows, but this approach doesn’t have the dramatic satisfaction of blowing up the enemy. That satisfaction is not trivial, and the United States can certainly blow something up and call it the enemy, but it does not address the strategic problem. In the first place, is it really a problem for the United States?

There is no reason not to bomb the Islamic State’s forces and leaders. They certainly deserve it. But there should be no illusion that bombing them will force them to capitulate or mend their ways. They are now part of the fabric of the Sunni community, and only the Sunni community can root them out. Identifying Sunnis who are anti-Islamic State and supplying them with weapons is a much better idea. It is the balance-of-power strategy that the United States follows, but this approach doesn’t have the dramatic satisfaction of blowing up the enemy. That satisfaction is not trivial, and the United States can certainly blow something up and call it the enemy, but it does not address the strategic problem. In the first place, is it really a problem for the United States? The American interest is not stability but the existence of a dynamic balance of power in which all players are effectively paralyzed so that no one who would threaten the United States emerges. The Islamic State had real successes at first, but the balance of power with the Kurds and Shia has limited its expansion, and tensions within the Sunni community diverted its attention. Certainly there is the danger of intercontinental terrorism, and U.S. intelligence should be active in identifying and destroying these threats. But the re-occupation of Iraq, or Iraq plus Syria, makes no sense. The United States does not have the force needed to occupy Iraq and Syria at the same time. The demographic imbalance between available forces and the local population makes that impossible.

The danger is that other Islamic State franchises might emerge in other countries. But the United States would not be able to block these threats as well as the other countries in the region. Saudi Arabia must cope with any internal threat it faces not because the United States is indifferent, but because the Saudis are much better at dealing with such threats. In the end, the same can be said for the Iranians. Most important, it can also be said for the Turks. The Turks are emerging as a regional power. Their economy has grown dramatically in the past decade, their military is the largest in the region, and they are part of the Islamic world. Their government is Islamist but in no way similar to the Islamic State, which concerns Ankara. This is partly because of Ankara’s fear that the jihadist group might spread to Turkey, but more so because its impact on Iraqi Kurdistan could affect Turkey’s long-term energy plans.

The United States cannot win the game of small mosaic tiles that is emerging in Syria and Iraq. An American intervention at this microscopic level can only fail. But the principle of balance of power does not mean that balance must be maintained directly. Turkey, Iran and Saudi Arabia have far more at stake in this than the United States. So long as they believe that the United States will attempt to control the situation, it is perfectly rational for them to back off and watch, or act in the margins, or even hinder the Americans. The United States must turn this from a balance of power between Syria and Iraq to a balance of power among this trio of regional powers. They have far more at stake and, absent the United States, they have no choice but to involve themselves. They cannot stand by and watch a chaos that could spread to them. It is impossible to forecast how the game is played out. What is important is that the game begins. The Turks do not trust the Iranians, and neither is comfortable with the Saudis. They will cooperate, compete, manipulate and betray, just as the United States or any country might do in such a circumstance. The point is that there is a tactic that will fail: American re-involvement. There is a tactic that will succeed: the United States making it clear that while it might aid the pacification in some way, the responsibility is on regional powers. The inevitable outcome will be a regional competition that the United States can manage far better than the current chaos.

U.S. strategy is sound. It is to allow the balance of power to play out, to come in only when it absolutely must — with overwhelming force, as in Kuwait — and to avoid intervention where it cannot succeed. The tactical application of strategy is the problem. In this case the tactic is not direct intervention by the United States, save as a satisfying gesture to avenge murdered Americans. But the solution rests in doing as little as possible and forcing regional powers into the fray, then in maintaining the balance of power in this coalition. Such an American strategy is not an avoidance of responsibility. It is the use of U.S. power to force a regional solution. Sometimes the best use of American power is to go to war. Far more often, the best use of U.S. power is to withhold it. The United States cannot evade responsibility in the region. But it is enormously unimaginative to assume that carrying out that responsibility is best achieved by direct intervention. Indirect intervention is frequently more efficient and more effective.

Turkey and the ex-governor of Mosul, Atheel al-Nujaifi, would like to be present when the city is taken from Daesh, hoping to be able to prevent it from being occupied by the Popular Mobilisation Forces (al-Hashd al-Shaabi), the great majority of whom are Shia. It’s clear that everyone is dreaming – illegitimate President Massoud Barzani believes that no-one will question his annexation of the oil fields of Kirkuk and the Sinjar mountains – the leader of the Syrian Kurds, Saleh Muslim, imagines that he will soon be President of an internationally-recognised pseudo-Kurdistan – and President Recep Tayyip Erdoğan presumes that the Arabs of Mosul long to be liberated and governed by the Turks, as they were under the Ottoman Empire. Furthermore, in Ukraine, Turkey has deployed the International Islamist Brigade that it officially created last August. These jihadists, who were extracted from the Syrian theatre, were divided into two groups as soon as they arrived in Kherson. Most of them went to fight in Donbass with the Cheikh Manour and Djokhar Doudaïev Brigades, while the best elements were infiltrated into Russia in order to sabotage the Crimean economy, where they managed to cut all electricity to the Republic for 48 hours.

The terrorist forces We could deal here with the terrorist organisations, but that would involve pretending, like NATO, that these groups are independent formations which have suddenly materialised from the void, with all their salaries, armement and spare parts. More seriously, the jihadists are in fact mercenaries in the service of Turkey, Saudi Arabia and Qatar – it seems that the United Arab Emirates have almost completely withdrawn from this group – to which we must add certain multinationals like Academi, KKR and Exxon-Mobil. Turkey continues its military deployement in Bachiqa (Irak), in support of the Kurdish forces of illegitimate President Massoud Barzani who, although his mandate is terminated, refuses to leave power and organise new elections. When the Iraqi government demanded that Turkey remove its troops and tanks, Ankara responded that it had sent its soldiers to protect the training forces deployed in Iraq according to an earlier international agreement, and that it had no intention of withdrawing them. It then added even more, bringing the number of troops involved to at least 1,000 soldiers and 25 tanks. Iraq referred its case to the United Nations Security Council and the Arab League, without provoking the slightest reaction anywhere.

The Coalition has announced that it has carried out new bombing missions and destroyed a number of Daesh installations, but these allegations are unverifiable and even more doubtful insofar as the terrorist organisation has not made the slightest protest. From this disposition, we may conclude that France may elaborate its own strategy, but that the United States can re-assert control at any time.

Saudi Arabia united its mercenaries in Riyadh in order to constitute a delegation in readiness for the next round of negotiations organised by the NATO Director of Political Affairs, US neo-Conservative Jeffrey Feltman. The Saudis did not invite the representatives of Al-Qaïda, nor those of Daesh, but only the Wahhabist groups who are working with them, like Jaysh al-Islam or Ahrar al-Sham. Therefore, in theory, there were no « terrorist groups », as listed by the UNO Security Council, present at the conference. However, in practice, all the participants were fighting with, in the name of, or alongside Al-Qaïda or Daesh without using their label, since most of these groups are directed by personalities who once belonged to Al-Qaïda or Daesh. Thus, Ahrar al-Sham was created just before the beginning of the events in Syria by the Muslim Brotherhood and the principal leaders of Al-Qaïda, drawn from personalities close to Osama bin Laden. Continuing to act as they had before the Russisan intervention, the participants agreed to a « political solution » which would start with the abdication of the democratically-elected President Bachar el-Assad, and continue with a sharing of power between themselves and the Republican institutions. Thus, although they have lost all hope of a military victory, they persist in counting on the surrender of the Syrian Arab Republic.

Since the representative of the Syrian Kurds was not invited to the conference, we may conclude that Saudi Arabia considers the project for a pseudo-Kurdistan as distinct from the future of the rest of Syria. Let us note in passing that the YPG has just created a Syrian Democratic Council in order to reinforce the illusion of an alliance between Selah Muslim’s Kurds and the Sunni and Christian Arabs, when in reality, they are fighting each other on the ground. In any case, there is no doubt that Riyadh is supporting Turkey’s efforts to create this pseudo-Kurdistan as a place of banishment for « its » Kurds. Indeed, it is now confirmed that Saudi Arabia supplied the logistical aid necessary for Turkey to guide the air-air missile which shot down the Russian Soukhoï 24. Finally, Qatar is still pretending that it has not been involved in the war since the abdication of Emir Hamad, two years ago. Nonetheless, proof is accumulating of its secret operations, all of which are directed not against Damascus, but against Moscow – thus, the Qatari Minister of Defence, in Ukraine at the end of September, bought a number of sophisticated Pechora-2D anti-air weapons which the jihadists could use to threaten Russian forces. More recently, he organised a false-flag operation against Russia. Still in Ukraine, at the end of October, he bought 2,000 OFAB 250-270 Russian fragmentation bombs and dispersed them on the 6th December over a camp of the Syrian Arab Army, in order to accuse the Russian Army of blundering. In this case too, despite the proof, there was no reaction from the UNO.

The patriotic forces The Russian forces have been bombing the jihadists since the 30th September. They plan to continue at least until the 6th January. Their action is aimed principally at destroying the bunkers built by these armed groups and the totality of their logistical networks. During this phase, there will be little evolution on the ground other than a withdrawal of jihadists towards Iraq and Turkey. The Syrian Arab Army and its allies are preparing a vast operation for the beginning of 2016. The objective is to provoke an uprising of the populations dominated by the jihadists, and to take almost all the cities in the country simultaneously – with the possible exception of Palmyra – so that the foreign mercenaries will fall back to the desert. Unlike Iraq, where 120,00 Sunnis and Ba’athists joined Daesh only to exact revenge for having been excluded from power by the United States in favour of the Chiites, rare are the Syrians who ever acclaimed the « Caliphate ». On the 21st and 22nd November, in the Mediterranean, the Russian army took part in excercises with its Syrian ally. As a result, the airports of Beirut (Lebanon) and Larnaca (Cyprus) were partially closed. On the 23rd and 24th November, the firing of Russian missiles on Daesh positions within Syria provoked the closing of the airports at Erbil and Sulaymaniyah (Iraq). It seems that in reality, the Russian army may have been testing the possible extension of its weapon that inhibits NATO communications and commands. In any case, on the 8th December, the submarine Rostov-on-Don fired on Daesh installations from the Mediterranean.

Russia, which disposes of the air base at Hmeymim (near Lattakia), also uses the air base of the Syrian Arab Army in Damascus, and is said to be building a new base at al-Shayrat (near Homs). Besides this, some high-ranking Russian officers have been carrying out scouting missions with a view to creating a fourth base in the North-East of Syria, in other words, close to both Turkey and Iraq. Finally, an Iranian submarine has arrived off the coast of Tartus. Hezbollah, who demonstrated their capacity to carry out commando operations during their liberation of the Sukhoï pilot held prisoner by militias organised by the Turkish army, are preparing the uprising of Shia populations, while the Syrian Arab Army – which is more than 70% Sunni – is concentrating on the Sunni populations. The Syrian government has concluded an agreement with the jihadists of Homs, who have finally accepted to either join up or leave. The area has been evacuated under the control of the United Nations, so that today, Damascus, Homs, Hama, Lattakia and Der ez-Zor are completely secure. Aleppo, Idlib and Al-Raqqah still need to be liberated. Contrary to peremptory affirmations by the western Press, Russia has no intention of leaving the north of the country to France, Israël and the United Kingdom so that they can create their pseudo-Kurdistan. The patriot plan forsees the liberation of all the inhabited areas of the country, including Rakka, which is the current « capital of the Caliphate ». This is the calm before the storm.

“Lt. Col. Fares al-Bayyoush, the former aviation engineer who now heads the Fursan al-Haq Brigade, acknowledged that his men had fought alongside the Nusra Front because they needed all the help they could get. “Sometimes, he said, that help comes in forms only a jihadi group can provide. He cited the rebel takeover of the northern town of Khan Sheikhoun, saying that the rebels were unable to take out one government position until the Nusra Front sent a suicide bomber to blow it up. In another town nearby, Nusra sent four bombers, including an American citizen. “‘We encourage them actually,’ Mr. Bayyoush said with a laugh. ‘And if they need vehicles, we provide them’.”

The “moderate” rebels also don’t share President Obama’s priority of carrying the fight to the Islamic State militants, reported Hubbard, “ousting Mr. Assad remains their primary goal.” This dilemma of the mixed allegiances of the “moderates” has been apparent for at least the past year. Last September, many of the previously hailed Syrian “moderate” rebels unveiled themselves to be Islamists who repudiated the U.S.-backed political opposition and allied themselves with al-Qaeda’s al-Nusra Front. [See Consortiumnews.com’s “Syrian Rebels Embrace Al-Qaeda.”] In other words, the just-approved congressional action opening the floodgates to hundreds of millions of dollars more in military aid to Syrian “moderates” could actually contribute to al-Qaeda’s Syrian affiliate gaining control of Syria, which could create a far greater threat to U.S. national security than the consolidation of the Islamic State inside territory of Syria and Iraq.

While the Islamic State brandishes its brutality as a gruesome tactic for driving Western interests out of the Middle East, it has shown no particular interest in taking its battle into the West. By contrast, al-Qaeda follows a conscious strategy of inflicting terrorist attacks on the West as part of a long-term plan to wreck the economies of the United States and Europe. Thus, Obama’s hastily approved strategy for investing more in Syrian “moderates” – if it allows a continued spillover of U.S. military equipment to al-Nusra – could increase the chances of creating a base for international terrorism in Damascus at the heart of the Middle East. That would surely prompt demands for a reintroduction of U.S. ground troops into the region.

There are also obvious alternatives to following such a self-destructive course, although they would require Obama and much of Official Washington to climb down from their collective high horses and deal with such demonized leaders as Syria’s Assad and Russian President Vladimir Putin, not to mention Iran. A “realist” strategy would seek out a realistic political solution to the Syrian conflict, which would mean accepting the continuation of Assad’s rule, at least for the near term, as part of a coalition government that would offer stronger Sunni representation. This unity government could then focus on eliminating remaining pockets of al-Qaeda and Islamic State resistance before holding new elections across as much of the country as possible.

As part of this strategy to weaken these Islamic extremists, the United States and the European Union would have to crack down on the militants’ funding sources in Saudi Arabia and the Persian Gulf, as touchy as that can be with the Saudis holding such influence over the U.S. economy. But Obama could start the process of facing down Saudi blackmail by declassifying the secret section of the 9/11 Report which reportedly describes Saudi financing of al-Qaeda before the 9/11 attacks. I’m told that U.S. intelligence now has a clear picture of which Saudi princes are providing money to Islamist terrorists. So, instead of simply sending drones and warplanes after youthful jihadist warriors, the Obama administration might find it more useful to shut down these funders, perhaps nominating these princes as candidates for the U.S. “capture or kill list.”

To get Assad fully onboard for the necessary concessions to his Sunni opponents, the Russians could prove extremely valuable. According to a source briefed on recent developments, Russian intelligence already has served as a go-between for U.S. intelligence to secure Assad’s acceptance of Obama’s plan to send warplanes into parts of Syrian territory to attack Islamic State targets. The Russians also proved helpful a year ago in getting Assad to surrender his chemical weapons arsenal to defuse a U.S. threat to begin bombing Assad’s military in retaliation for a Sarin gas attack outside Damascus on Aug. 21, 2013. Although Assad denied involvement – and subsequent evidence pointed more toward a provocation by rebel extremists – Putin’s intervention gave Obama a major foreign policy success without a U.S. military strike. That intervention, however, infuriated Syrian rebels who had planned to time a military offensive with the U.S. bombing campaign, hoping to topple Assad’s government and take power in Damascus. America’s influential neoconservatives and their “liberal interventionist” allies – along with Israeli officials – were also livid, all eager for another U.S.-backed “regime change” in the Middle East.

Putin thus made himself an inviting neocon target. By the end of last September, American neocons were taking aim at Ukraine as a key vulnerability for Putin. A leading neocon, Carl Gershman, president of the U.S.-government-funded National Endowment for Democracy, took to the op-ed pages of the neocon Washington Post to identify Ukraine as “the biggest prize” and explain how its targeting could undermine Putin’s political standing inside Russia. “Ukraine’s choice to join Europe will accelerate the demise of the ideology of Russian imperialism that Putin represents,” Gershman wrote. “Russians, too, face a choice, and Putin may find himself on the losing end not just in the near abroad but within Russia itself.” At the time, Gershman’s NED was funding scores of political and media projects inside Ukraine. What followed in Ukraine had all the earmarks of a U.S. destabilization campaign against Putin’s ally, the elected President Viktor Yanukovych.

Then, with U.S. officialdom and the mainstream U.S. press engaging in an orgy of Cold War-style propaganda, Putin was demonized as a new Hitler expanding territory by force. Anyone who knew the facts recognized that Putin had actually been trying to maintain the status quo, i.e., sustain the Yanukovych government until the next election, and it was the West that had thrown the first punch. But Washington’s new “group think” was that Putin instigated the Ukraine crisis so he could reclaim lost territory of the Russian empire. President Obama seemed caught off-guard by the Ukraine crisis, but was soon swept up in the West’s Putin/Russia bashing. He joined in the hysteria despite the damage that the Ukraine confrontation was inflicting on Obama’s own hopes of working with Putin to resolve other Middle East problems.

Thus, the initial victory went to the neocons who had astutely recognized that the emerging Putin-Obama collaboration represented a serious threat to their continued plans for “regime change” across the Middle East. Not only had Putin helped Obama head off the military strike on Syria, but Putin assisted in getting Iran to agree to limits on its nuclear program. That meant the neocon desire for more “shock and awe” bombing in Syria and Iran had to be further postponed. The Putin-Obama cooperation might have presented an even greater threat to neocon plans if the two leaders could have teamed up to pressure Israeli Prime Minister Benjamin Netanyahu to finally reach a reasonable agreement with the Palestinians. At the center of the neocons’ strategy at least since the mid-1990s has been the idea that “regime change” in Middle East governments hostile to Israel would eventually starve Israel’s close-in enemies, such as Lebanon’s Hezbollah and Palestine’s Hamas, of support and free Israel’s hand to do what it wanted with the Palestinians. [See Consortiumnews.com’s “The Mysterious Why of the Iraq War.”]

The Putin-Obama collaboration – if allowed to mature – could have derailed that core neocon strategy and denied Israel the unilateral power to decide the Palestinians’ fate. But the Ukraine crisis – and now the plan to pour a half-billion dollars into the Syrian rebels fighting Assad – have put the neocon strategy back on track. The next question is whether Obama and whatever “realists” remain in Official Washington have the will and the determination to reclaim control of the Middle East policy train and take it in a different direction.

However, oil makes up 97 percent of Venezuela’s export earnings, and the market shift has already caused the country a 30 percent loss in foreign income, Maduro said last week. According to Reuters, PDVSA has put the possible sale of U.S. refinery Citgo Petroleum Corp back on the table. People close to the matter have reported that Lazard Ltd, the investment bank hired by PDVSA to explore the sale, has set a late-December deadline for new offers, despite Venezuelan finance minister ruling it out last month. Citgo runs three refineries in the United States, totaling an estimated value of up to $10 billion.