Crude Oil Spikes on News That Saudi Arabia Tells Citizens to Leave Lebannon Immediately

Here's the intraday chart of crude oil (Yahoo Finance):

Here's the short snippet from Reuters (8/15/2012):

Saudi Arabia tells citizens to leave Lebanon immediately - SPA

(Reuters) - Saudi Arabia has ordered its citizens to leave Lebanon "immediately", the state news agency reported in an SMS alert on Wednesday.

"The Saudi Arabian embassy in Lebanon calls all Saudi citizens to leave Lebanon immediately," the alert said, without elaborating.

(Reporting by Asma Alsharif; Writing by Raissa Kasolowsky)

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Stratfor Red Alert: #Saudi Police Fire on Protesters in Oil Hub

That's Qatif. Major oil pipelines that go to the world's largest oil port, Ras Tanura, go directly through Qatif, according to Stratfor.

Uh oh...

I guess CNBC didn't know that; they rather dismissed the incident by saying "oil prices slipped back on word that the unrest was driven by protesters in the eastern city of Qatif, home to a Shiite minority". It's just against the Shi'ite minority there, what's the big deal?

Stratfor seems to think it could be a very big deal, big enough for them to send out a red alert:

Red Alert: Saudi Police Fire On Protesters In Oil Hub

(3/10/2011)

Saudi police have reportedly opened gunfire on and launched stun grenades at several hundred protesters March 10 rallying in the heavily Shiite-populated city of Qatif in Saudi Arabia’s oil-rich Eastern Province.

The decision to employ violence in this latest crackdown comes a day before Friday prayers, after which various Saudi opposition groups were planning to rally in the streets. Unrest has been simmering in the Saudi kingdom over the past couple weeks, with mostly Sunni youth, human rights activists and intellectuals in Riyadh and Jeddah campaigning for greater political freedoms, including the call for a constitutional monarchy. A so-called “Day of Rage” of protests across the country has been called for March 11 by Facebook groups Hanyn (Nostalgia) Revolution and the Free Youth Coalition following Friday prayers.

What is most critical to Saudi Arabia, however, is Shiite-driven unrest in the country’s Eastern Province. Shiite activists and clerics have become more vocal in recent weeks in expressing their dissent and have been attempting to dodge Saudi security forces. The Saudi regime has been cautious thus far, not wanting to inflame the protests with a violent crackdown but at the same time facing a growing need to demonstrate firm control.

Yet in watching Shiite unrest continue to simmer in the nearby island of Bahrain, the Saudi royals are growing increasingly concerned about the prospect of Shiite uprisings cascading throughout the Persian Gulf region, playing directly into the Iranian strategic interest of destabilizing its U.S.-allied Arab neighbors. By showing a willingness to use force early, the Saudi authorities are likely hoping they will be able to deter people from joining the protests, but such actions could just as easily embolden the protesters.

There is a strong potential for clashes to break out March 11 between Saudi security forces and protesters, particularly in the vital Eastern Province. Saudi authorities have taken tough security measures in the Shiite areas of the country by deploying about 15,000 national guardsmen to thwart the planned demonstrations by attempting to impose a curfew in critical areas. Energy speculators are already reacting to the heightened tensions in the Persian Gulf region, but unrest in cities like Qatif cuts directly to the source of the threat that is fueling market speculation: The major oil transit pipelines that supply the major oil port of Ras Tanura — the world’s largest, with a capacity of 5 million barrels per day — go directly through Qatif.

There you go, Ben and Timmy. Your PPT has the work cut out tomorrow. Better start right now, buying up all S&P400 Eminis...

Or, they could use this occasion to instill "fear" in the populace that would justify QE3; in that case they might want the stock market to flash crash...

Here's the map of Qatif and Ras Taruna:

View Larger Map

Oh wait, what's near by? Zoom out, and look southeast. It's Bahrain.

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And US Resonse to #Saudi's Firing at Protesters

is as lame as it can possibly get. From Guardian's Libya Live Updates:

8.13pm GMT: Asked to respond to reports of gunfire used to disperse protesters in Saudi Arabia, a national security council spokesperson in Washington says: "We're going to support a set of universal values in every country in the region."

And what is that "set of universal values", pray tell?

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#Saudi Police Fires at Protesters in Qatif

from AP:

Saudi police have opened fire at a rally in the kingdom's east in an apparent escalation of efforts to stop planned protests.

Government officials have warned they will take strong action if activists take to the streets after increasing calls for large protests around the oil-rich kingdom to press for democratic reforms.

A witness in the eastern city of Qatif says gunfire and stun grenades were fired at several hundred protesters marching in the city streets Thursday. The witness, speaking on condition of anonymity because he feared government reprisal, said police in the area opened fire. The witness saw at least one protester injured.

I bet there's going to be a DEAD SILENCE from the US.

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Oil Has Just Gone Vertical on News that Shots Were Fired in #Saudi Arabia

Here's the chart of USO, an ETF that tracks crude oil price.

Saudi's Day of Rage is tomorrow, Friday.

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(#Libya) Today's WTF Moment: "Obama asks #Saudis to airlift weapons into Benghazi"

From Robert Fisk (3/7/2011):

Desperate to avoid US military involvement in Libya in the event of a prolonged struggle between the Gaddafi regime and its opponents, the Americans have asked Saudi Arabia if it can supply weapons to the rebels in Benghazi. The Saudi Kingdom, already facing a "day of rage" from its 10 per cent Shia Muslim community on Friday, with a ban on all demonstrations, has so far failed to respond to Washington's highly classified request, although King Abdullah personally loathes the Libyan leader, who tried to assassinate him just over a year ago.

Washington's request is in line with other US military co-operation with the Saudis. The royal family in Jeddah, which was deeply involved in the Contra scandal during the Reagan administration, gave immediate support to American efforts to arm guerrillas fighting the Soviet army in Afghanistan in 1980 and later – to America's chagrin – also funded and armed the Taliban.

But the Saudis remain the only US Arab ally strategically placed and capable of furnishing weapons to the guerrillas of Libya. Their assistance would allow Washington to disclaim any military involvement in the supply chain – even though the arms would be American and paid for by the Saudis.

And probably with the US military "advisors" aplenty, I suppose. But here's one problem, Fisk says:

If the Saudi government accedes to America's request to send guns and missiles to Libyan rebels, however, it would be almost impossible for President Barack Obama to condemn the kingdom for any violence against the Shias of the north-east provinces.

The violence is a real possibility, even if the Shia demonstrators put women and children in front. Sunni security forces may simply gun them down anyway, considering how they treat women in general in Saudi Arabia.

And lastly,

Thus has the Arab awakening, the demand for democracy in North Africa, the Shia revolt and the rising against Gaddafi become entangled in the space of just a few hours with US military priorities in the region.

So far above Obama's pay grade. So far. (Not to mention others in the US gov.)

Read the entire article at the link.

I still like Zbigniew Brzezinski's idea to park US ships right off the shores of Tripoli, which he delivered with conviction the other day on Al Jazeera. It does not involve "boots on the ground" but highly symbolic and probably just as effective. But it needs "thinking" and "planning", which are totally lacking in this particular US administration.

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Asia's "End Game": China

If #Saudi Arabia is the "end game" in uprising in north Africa and Middle East, the "end game" in Asia will be #China.

Aside from the phony "Jasmine" revolution, which does look to be one of those Soros/US government-funded "color revolutions", the Communist regime in China seems to be feeling the heat. Not from their own citizens (not yet, anyway) but from Tunisia, Egypt, Libya, Bahrain, Yemen, now Saudi Arabia, where the ruled have finally said "enough is enough". In Asia, pockets of protests have started to appear in Communist Vietnam and North Korea, and South Koreans are busy withdrawing their money from their banks.

So, what do they do? Preemptive strike: Placate the populace quickly before they start to get funny ideas in spite of the government banning #Egypt from Twitter.

From Al Jazeera (3/5/2011):

China's government has vowed to clamp down on inflation and urgently raise incomes, as Wen Jiabao, the country's premier, devoted most of his country's equivalent of the US 'State of the Union' speech to addressing citizens' economic concerns.

Addressing the opening of the National People's Congress on Saturday, Jiabao said that the country's working class and rural residents would receive more assistance from the government, in a move aimed at sharing the benefits of rapid economic growth across more sectors of society.

Living standards are rising in China, but there have been complaints about accompanying rises in prices, as well as a lack of equitability in the benefits of national economic growth.

"We must make improving the people's lives a pivot linking reform, development and stability ... and make sure people are content with their lives and jobs, society is tranquil and orderly and the country enjoys long-term peace and stability," Wen told the legislature's nearly 3,000 members.

It is very true that the Chinese are more "economic"-minded than other races; as long as they have money and are well-fed, they couldn't care less about political issues.

Now, however, thanks to Ben "Bernank" of the US Federal Reserve and also to the long-standing Chinese policy of pegging (officially or not, tightly or loosely, it is "pegged") the currency to US dollar to keep their exported (junky) goods competitive, the money people have is worth less and less each day. The food prices have gone so much in a short time that the Chinese government has decided to reduce weight of foods in their CPI.

So what tool that's still left? State propaganda:

Chinese media, meanwhile, warned citizens against attempting to emulate popular protest movements in the Middle East and North Africa, warning that any threats to Communist Party-led stability could bring "disaster".

"Everyone knows that stability is a blessing and chaos is a calamity," said the Beijing Daily newspaper, which is the mouthpiece of the Communist Party administration for China's capital.

Yeah. Try to tell that to Tunisians and Egyptians and Libyans. The mouthpiece sounds like Saif al-Islam Gaddafi, actually.

Everybody knows that dice are loaded
Everybody rolls with their fingers crossed
Everybody knows the war is over
Everybody knows the good guys lost
Everybody knows the fight is fixed
The poor stay poor, the rich get rich
That's how it goes
Everybody knows

(Leonard Cohen "Everybody Knows")

And against that "fixed" fight people in Tunisia, Egypt, Libya, and other Middle East countries have risen. Can the Chinese government succeed in keep fixing the fight?

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Robert Fisk: Saudis Mobilize Thousands of Troops to Quell Growing Revolt

In #Saudi Arabia, the end game may be happening right about now. Uprisings against regimes in northern Africa and Middle East seem to be finally catching the House of Saud.

Robert Fisk writes (3/5/2011):

Saudi Arabia was yesterday drafting up to 10,000 security personnel into its north-eastern Shia Muslim provinces, clogging the highways into Dammam and other cities with busloads of troops in fear of next week's "day of rage" by what is now called the "Hunayn Revolution".

Saudi Arabia's worst nightmare – the arrival of the new Arab awakening of rebellion and insurrection in the kingdom – is now casting its long shadow over the House of Saud. Provoked by the Shia majority uprising in the neighbouring Sunni-dominated island of Bahrain, where protesters are calling for the overthrow of the ruling al-Khalifa family,

King Abdullah of Saudi Arabia is widely reported to have told the Bahraini authorities that if they do not crush their Shia revolt, his own forces will.

Oh wait.. Then the eyewitness account of tanks crossing the bridge to Bahrain, which has been denied by the Saudi government, may have been accurate..

Fisk continues:

The opposition is expecting at least 20,000 Saudis to gather in Riyadh and in the Shia Muslim provinces of the north-east of the country in six days, to demand an end to corruption and, if necessary, the overthrow of the House of Saud. Saudi security forces have deployed troops and armed police across the Qatif area – where most of Saudi Arabia's Shia Muslims live – and yesterday would-be protesters circulated photographs of armoured vehicles and buses of the state-security police on a highway near the port city of Dammam.

Although desperate to avoid any outside news of the extent of the protests spreading, Saudi security officials have known for more than a month that the revolt of Shia Muslims in the tiny island of Bahrain was expected to spread to Saudi Arabia. Within the Saudi kingdom, thousands of emails and Facebook messages have encouraged Saudi Sunni Muslims to join the planned demonstrations across the "conservative" and highly corrupt kingdom. They suggest – and this idea is clearly co-ordinated – that during confrontations with armed police or the army next Friday, Saudi women should be placed among the front ranks of the protesters to dissuade the Saudi security forces from opening fire.

If the Saudi royal family decides to use maximum violence against demonstrators, US President Barack Obama will be confronted by one of the most sensitive Middle East decisions of his administration. In Egypt, he only supported the demonstrators after the police used unrestrained firepower against protesters. But in Saudi Arabia – supposedly a "key ally" of the US and one of the world's principal oil producers – he will be loath to protect the innocent.

It will simply be above Obama's pay grade, Mr. Fisk, and he couldn't care less or is too lazy. As you pointed out earlier, all he cares about is getting re-elected, and in the US it is not by popular vote.

Read the full article at the link.

Got oil?

Got gold? Got silver?

Got food?

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Protests in #Saudi Arabia

Al Jazeera may soon need "Saudi Arabia Live Blog"...

Just reading tweets by Sultan Al Qassemi:

More chants in Qatif: "We vow that we won't forget our prisoners" "Sunni & Shia we won't sell our nation" Arabic Video http://bit.ly/f9JmHn
46 minutes ago via web

Other chants include "Mansiyoon - Mansiyoon" "We are forgotten". Qatif is the centre of the Saudi Shia minority population.
48 minutes ago via web

I'm watching internet uploaded videos of the protests in Qateef in #Saudi, chants of "Silmiya - Silmya" "Peaceful - Peaceful"
49 minutes ago via web

Robert Fisk thinks the "end game" in all these uprisings in NAME (Northern Africa, Middle East) is Saudi Arabia.

As I posted in my TA blog, someone bought a large amount of call options on oil ETF (USO) that will expire in July. I bought along with that person, just in case.

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#Saudi Arabia Sends Tanks to #Bahrain

From RIA Novosti News (3/1/11):

Saudi Arabia has sent dozens of tanks to Bahrain, where anti-government protests continue for about two weeks, Egypt's Al-Masry Al-Youm newspaper said on Tuesday.

Eyewitnesses reported seeing "15 tank carriers carrying two tanks each heading towards Bahrain" along the 25-km King Fahd causeway, which links the small island nation of Bahrain to Saudi Arabia.

Crude oil is hitting $99.25 (WTI), and $115.04 (Brent).

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#Gaddafi's Sons Sought Religious Ruling Against Protesters from Saudi Clerics

and were denied, reports Reuters Africa:

DUBAI, Feb 28 (Reuters) - Sons of Libyan leader Muammar Gaddafi have failed to persuade prominent Saudi clerics to issue religious rulings against a revolt that is threatening to bring down the veteran leader, Al Arabiya television said on Monday.

The Saudi-owned channel said on its website that Gaddafi's son Saif al-Islam had contacted one cleric, Salman al-Awda, and Saadi Gaddafi had reached out to a second, Ayedh al-Garni, but both rejected their calls.

"You are killing the Libyan people. Turn to God because you are wronging them. Protect Libyan blood, you are killing old people and children. Fear God," Garni said he told Saadi.

Garni made the remarks on air on Sunday, the website said, adding Awda gave the same message to Saif al-Islam.

There are protests planned in Saudi Arabia on March 10 and March 20. Robert Fisk, of The Independent, thinks the "end game" is Saudi Arabia. We'll see.

Saadi Gaddafi spoke the truism in his interview with ABC's Amanpour the other day:

"It's fever. It's going to spread everywhere. No one can stop it. That is my personal opinion, and the chaos will be everywhere. ... They think it's about freedom. I love freedom. You love freedom, but it's powerful, this earthquake. No one can control it."

We'll see soon enough.

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Nomura Says Oil May Go to $220 if (Only) Libya and Algeria Cut Output

With half of Libya's daily output is now off-line, and with some commotion in Saudi Arabia (the world 2nd largest producer) not to mention already tense Algeria, Nomura could prove right..

From Zero Hedge [emphasis is original]:

Waiting for a Saudi revolution before buying those $200 oil calls? It may be time to reevaluate: according to Nomura a halt in just Libyan and Algerian oil production (far more likely than the crisis spilling over to Saudi) would send oil to over $220/bbl. Specifically "the closest comparison to the current MENA unrest is the 1990-91 Gulf War. If Libya and Algeria were to halt oil production together, prices could peak above US$220/bbl and OPEC spare capacity will be reduced to 2.1mmbbl/d, similar to levels seen during the Gulf war and when prices hit US$147/bbl in 2008." Wouldn't a doubling in price lead to a major demand plunge as well? Yes it would "This could also result in a temporary demand destruction of some 2.0mmbbl/d globally." Also, since the Fed's free money was not flooding global market last time, $220 is just a lowball estimate: "We could be underestimating this as speculative activities were largely not present in 1990-91."

More observations from Nomura's Michael Lo:

• In order to estimate the impact the current MENA crisis could have on oil supply and prices, we analysed past crises that rocked the region. There have been a few events that drove oil prices higher (from 30% to 130% per event), most of which were during the period in which OPEC controlled oil prices. However, we believe the closest comparison is the 1990-91 Gulf War as this is the only event outside of that period. During the seven months of Gulf War, prices jumped 130% as OPEC spare capacity was reduced to 1.8mmbbl/d while demand came off briefly by 1.7%. Similarly, today, if Libya and Algeria were to halt operations, OPEC spare capacity will also likely be drawn down to 2.1mmbbl/d, in our view, which could fuel higher oil prices.

• We have identified three distinct stages of the Gulf war which led to changes in oil prices and we believe we are only at the initial stage of the three stage process for the current MENA unrest. During the initial stage of the Gulf war, prices moved up by 21%. This is comparable to what we have seen recently when oil price went up by 13% since the beginning of the MENA unrest. As we see further evidence of real supply disruption, we will be moving into Stage 2 of the event – during this stage of the Gulf war, prices moved to its peak (up 130%) within a period of two months. On the assumption that prices will move up by the same amount, we could see US$220/bbl should both Libya and Algeria halt their oil production. We could be underestimating this as speculative activities were largely not present in 1990-91.

• Open interest in WTI futures contracts has risen 2.4% since the beginning of the MENA crisis in January this year. On the other hand, open interest in Brent future contracts has fallen 7.6% during the same period. This was primarily on back of the large WTI-Brent differential during the period, as WTI crude prices are being suppressed by Cushing storage and infrastructure issues while Brent crude price was lifted by supply outages in North Sea fields.

For more, go to the link. Zero Hedge has the full report of Nomura.

On a side note, there is NO BID on US dollars....

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DEBKA: Mubarak Moved a Large Part of Assets from Europe to Saudi Arabia On Feb 12-13

With a grain of salt, from DEBKAfile (2/14/2011):

Hosni Mubarak and his family have moved a large part of their assets – guesstimated at between $20 and $70 billion - from European banks to Saudi Arabia and the United Arab Republics against personal guarantees from King Abdullah and Sheik Al Nahyan to block access to outside parties.This is reported by Gulf and West European sources. Tunisian ex-ruler Zein Al Abdain Ben Ali received the same guarantee when he fled his country and received asylum in the oil kingdom.

A Swiss financial source commented: "If he had any real money in Zurich, it may be gone by now."

According to debkafile's sources, the transfers took place on Feb. 12-13. Although a weekend when European banks are closed, high-ranking officials in Riyadh had their managers hauled out of home to execute Mubarak's transfer orders without delay.

The ousted Egyptian ruler was on the phone to Saudi King Abdullah Friday, Feb. 11, immediately after his vice president Omar Suleiman went on state television to announce his resignation and handover of rule to the army. Mubarak called it a military putsch conducted under pressure from Washington. He denied he had resigned or passed any powers to the army. "I had no idea Omar Suleiman was about to read out that statement. I would never have signed it or allowed it to be published," said Mubarak.

The Saudi king voiced understanding for the ex-president's plight and said the Riyadh government was under orders to meet any requests for assistance received from him.....

In another, earlier article, DEBKA says that Saudi Arabia has initiated a dialog with Iran, and that the Saudi king is extremely upset with Obama over the US handling of the situation in Egypt. The article cites unnamed sources who told DEBKA that the king was so upset talking to Obama on the phone on February 10 that he suffered a heart attack.

As I said at the top, with a grain of salt.

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Admiral Mullen: US Has Iran Strike Plan Ready, Just in Case

Here we go...

Mullen says US has Iran strike plan, just in case
(Anne Gearan, 8/1/2010 AP via Yahoo News)

WASHINGTON – The U.S. military has a plan to attack Iran, the chairman of the Joint Chiefs of Staff said Sunday, although he thinks a military strike is probably a bad idea.

Not long after Adm. Mike Mullen's aired on a Sunday talk show, the deputy chief of Iran's Revolutionary Guard was quoted as saying there would be a strong Iranian response should the U.S. take military action against his country.

Mullen, the highest ranking U.S. military officer, often has warned that a strike on Iran would have serious and unpredictable ripple effects around the Middle East. At the same time, Mullen said the risk of Iran's developing a nuclear weapon is unacceptable, although he would not say which risk he thinks is worse.

"I think the military options have been on the table and remain on the table," Mullen said on "Meet the Press" on NBC. "It's one of the options that the president has. Again, I hope we don't get to that, but it's an important option and it's one that's well understood."" [Emphasis is mine. The article continues.]

"It's the one that's well understood" - I take it to mean that it is the most "ready" option.

Mullen thinks "a strike on Iran would have serious and unpredictable ripple effects". Duh. He should know by now, after 7 years in Iraq.

The US military and the government had thought that Iraqi people would rise up against Saddam once the US invaded their country, and the US troops would be greeted by the grateful citizenry who would throw flowers as the US soldiers march.

Remember Paul "War will pay for itself" Wolfowitz?

Kenneth "Cakewalk" Adelman?

Dick "We will be greeted as liberators" Cheney?

Or Condoleezza "We don't want the smoking gun to be a mushroom cloud" Rice?

Or all these people, including Prez Bush, who claimed "Iraq has weapons of mass destruction"?

Isn't it scary to think what kind of assumptions that the military and the administration are making right now for Iran? (My guess: more of the same. And they think we will fall for those, again.)

Mullen says above that "the risk of Iran's developing a nuclear weapon is unacceptable".

Unacceptable to whom? (Maybe here and here, even though the former has nuclear weapons already?)

The mere "risk" is unacceptable? Iran doesn't have a nuclear weapon, and by the CIA's own estimate will not even have a capability for another 2 years. It is like arresting people because they may develop a dangerous thought of committing a crime in the future. (Oh, they are going in that direction, aren't they?)

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Connect the Dots

Shall we?

On Tuesday I posted: Third US Fleet Is Now in Persian Gulf: "from June 6 through June 10, the USS Harry S. Truman carrier Strike Group was deployed 50 miles of the shore of southwestern Israel, secretly drilling the interception of incoming Iranian, Syrian and Hizballah missiles and rockets against US and Israeli targets in the Middle East."

Then on Wednesday, Iran on war alert over "US and Israeli concentrations" in Azerbaijan: "Other Iranian sources report that in the last few days, Israel has secretly transferred a large number of bomber jets to bases in Azerbaijan, via Georgia, and that American special forces are also concentrated in Azerbaijan in preparation for a strike."

Back to Georgia. Three years in a row.

You may recall (or may not, as it was just casually mentioned in MSM), Saudi Arabia gives Israel clear skies to attack Iranian nuclear sites: "Saudi Arabia has conducted tests to stand down its air defences to enable Israeli jets to make a bombing raid on Iran’s nuclear facilities, The Times can reveal." "“The Saudis have given their permission for the Israelis to pass over and they will look the other way,” said a US defence source in the area."

And Fidel Castro warns of possible clash between Israel, Iran: "Former Cuban leader Fidel Castro said he believes a clash between Israel and Iran is looming and that the United Nations and the United States would "have no way to change the course of events."" "In an article entitled "On the eve of the tragedy" published on Wednesday, Castro warned that Iran "will not bow to threats from Israel" and will not be resigned to the "unequal treatment" that would result in further sanctions over its nuclear program."

But then, this "attack may be imminent" scenario has repeated every summer for the past two years...

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