The Middle East has always made significant part of their income from oil and gas but it should not be forgotten that fossil fuels do not last forever. With the war in Ukraine and sanctions on Russia, one of the key players in the oil market, it is prime time for Arab countries to unite and capitalize on this opportunity.
How could this be achieved?
Thank you for reading this post, don't forget to subscribe!It has been done before and it can be done again under current circumstances. In 1973 OPEC member countries (Algeria, Iraq, Kuwait, Libya, Indonesia, Venezuela and Saudi Arabia) imposed an embargo against the United States in retaliation for the U.S. decision to re-supply the Israeli military and to gain leverage in the post-war peace negotiations.
As result prices for oil rose 300% up to $12 per barrel (equivalent to roughly $78 today). Economies of the U.S. and other countries that supported Israel started to feel the consequences of the fuel shortage, which was later called “first oil shock”. Back then the Arab states were able to find a common purpose for unification which led to the shift in the world balance. From that moment the Middle East had a bargaining chip at the negotiations table and other countries respect it till this day.
There is a clear parallel between the events in 1973 and the current Ukrainian conflict. The only distinct difference is this time the West did a reversal from 1973 and imposed embargo on Russian oil and gas, which ultimately skyrocketed prices. So far oil stock has grown 68% and gas 191%, and it will not drop any time soon. Unfortunately, Qatar is the sole big natural gas exporter in the Arab world. Other nations mostly export oil, which did benefit from sanctions but the profits are not overwhelming.
The embargo was supposed to curb the Russian economy, but in reality Moscow profited tremendously from the high prices for natural gas. At the same time oil prices are being kept at an acceptable level. From the financial point of view Arab states are not capitalizing on the opportunity, but they should.
Taking into consideration that the West is able to dodge the worst of the crisis due to the relatively cheap prices for oil, which consequently permits them to allocate funding for Israeli military – and Ukraine – a country led by the president of Jewish origin. If the Middle-East does not impose an embargo, it could be argued that the Arab states are indirectly sponsoring Israel and Ukraine.
Even though Arabs have started to cooperate with Israel more in recent years, the tension between the two does exist. Remarkable that Israel keeps carrying out attacks on Gaza killing hundreds of Arabs and breaking international law, while U.S. along with other western states turn a blind eye. The recent murder of the Al Jazeera journalist Shireen Abu Akleh serves as a prime example of Israeli crimes. “The bullet killed a piece of all of us” was a reaction from Palestinians, whereas the West and the U.S. decided to let Israel get away scot-free.
The Ukrainian conflict will eventually end, and the Middle East risks being the only region that not only failed to seize the opportunity it was offered, but also sponsored the killing of their own people. It is up to the Arab leaders to join their forces in order to dictate their will to the West during and post conflict. This would prevent the oil prices drop and Israel would have to think twice before carrying out airstrikes on Syria or killing Palestinians in Gaza.
