Riyadh, capital of the world’s most prolific of crude oil producing nation – Saudi Arabia – has been rocked by both physical and political bangs this weekend, the Oilholic notes. Overnight, state TV confirmed the Saudis had intercepted a ballistic missile aimed at Riyadh's King Khaled Airport fired by Yemen’s Houthi rebels.
Witnesses reported loud bangs and parts of the destroyed missile were found in the airport’s car park. The Saudis are leading a campaign to defeat the Houthis, as part of an international air coalition that has bombed the rebel group since 2015. Who else, but Iran, purportedly backs the rebels.
Following the physical bang, came the political bang later in the day in the form of surprise dismissals and arrests of dozens of Saudi ministers, royals, officials and senior military officers by the country’s Crown Prince Mohammed bin Salman.
Even by secretive Saudi standards, the move is unprecedented. It points to an audacious attempt by the Prince to consolidate his power base and move closer to his ultimate objective of ascending to the country’s throne.
His father King Salman has been doing his bit too. Under convention, Prince Mohammed bin Nayef, a seasoned royal, was first in line to the throne to succeed Salman. But the King ousted him from the line of succession and stripped him of his role as interior minister.
Earlier in his reign, King Salman had removed his half-brother Prince Muqrin from the line of succession. By April 2015, the king had appointed Prince Mohammed bin Salman as second-in-line to the throne, giving him the title of deputy crown prince, a move that surprised many senior members of the ruling Saud family.
Now through what on paper appears to be an anti-corruption purge, the father-son duo have all but made sure of Mohammed bin Salman’s safe passage to the throne. However, in highly tribal Saudi Arabia, reports suggest the move has not gone down well.
How it all plays out in terms of geopolitical risk and the impact all of this could have on the oil price remains to be seen. For now at least, it’s just a few crude bangs, albeit at a time the oil price is back above July 2015 levels. That’s all for the moment folks! Keep reading, keep it crude!
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© Gaurav Sharma 2017. Photo: Oil extraction facility in the Middle East © Shell.