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To: Think4Yourself who wrote (72129)	8/31/2000 11:50:44 PM
From: Tomas	Read Replies (1) \| Respond to of 95453

Saudis find US a more demanding friend - Financial Times, September 1 Roula Khalaf analyses growing strains in America's relationship with the world's biggest oil producer and key Arab state Saudi Arabia cherishes its standing as the main Arab ally of the US. But being Washington's best friend can be uncomfortable. Today the broader strategies of the two countries continue to converge. Both are seeking stability in the Gulf, lower oil prices and a settlement of the Arab-Israeli conflict. Differences, however, are emerging over ways of achieving these objectives. Potential strains in the relationship have been highlighted by the debate over soaring oil prices. The world's largest oil producer shares US concerns over price stability and the Saudis have said they want prices, now above Dollars 30 a barrel, to settle in the neighbourhood of Dollars 25. But while the US seems to believe that bringing down prices requires Saudis and other members of the Organisation of Petroleum Exporting Countries (Opec) to pump more oil, the kingdom sees the situation as far more complex. Prince Nawaf bin Abdelaziz, a senior brother of King Fahd, told the Financial Times this week that producers and consumers should formulate a joint policy to reduce prices, taking into account taxes on petrol in industrialised countries. Admitting that output increases had not solved the problem, he said high prices should not be blamed only on producers. The kingdom, however, does not want to contradict the US officially, say analysts, or reject its requests for assistance. But it is also keen to preserve the unity of Opec, which was undermined when Saudi Arabia increased output this summer without a cartel agreement. These conflicting pressures appear to have led to Wednesday's vague announcement that the kingdom favoured a "reasonable" increase in production but that it would work with other Opec members to achieve it. The kingdom's dilemma is made worse by domestic politics. The country is in transition. The ailing King Fahd continues to have the last word. But Crown Prince Abdullah, who is running the day-to-day affairs of the kingdom, is a key decision maker. Though he too is committed to a strong relationship with the US, he is known as a nationalist who wants to strengthen the kingdom's ties with countries in the region and with Opec. He is credited with restoring Saudi leadership in the cartel. The problem, however, is that Washington is becoming a very demanding customer. As it continues to press for Saudi action on oil, it is seeking Saudi backing on an even more sensitive issue - the fate of Jerusalem, the main sticking point in President Bill Clinton's efforts to close a Middle East peace deal before leaving office. Saudi Arabia is as eager as the US for a Palestinian-Israeli peace settlement. But the rulers of the country where Islam was born cannot support recent US proposals which fall short of giving Palestinians full sovereignty over Muslim holy sites in the old city. A compromise on this issue would undermine their legitimacy. The debate over Jerusalem has underscored a main flaw in US strategy in the Middle East, which has been criticised as failing to take into account the weight of Arab public opinion in decision-making. Because most countries in the region are run by authoritarian regimes, the assumption has been that rulers can force any decision on their people. Royal family members say public opinion in Saudi Arabia is as important as in the US. "The strong relationship with the US will remain but it does not mean we agree to what they want, especially on Arab issues and especially on Jerusalem," says Prince Nawaf. "The administration works for peace in the Middle East but Arab citizens feel the US is biased against them and Arab (governments) have to take what people think into consideration." Analysts say that Saudi concerns about anti-US feelings in the Arab world have made it increasingly sensitive for the Saudi government to appear to be bowing to other demands, such as increased production of oil. But they could also complicate Saudi-US policy towards Iraq. Saudi Arabia agrees with the US on the need for maintaining UN sanctions on Iraq to contain President Saddam Hussein. But unlike the US, which faces no public pressure to lift sanctions, Saudi Arabia cannot ignore the widespread feeling against sanctions in the Arab world or the fact that other Arab governments are calling for an end to the suffering of ordinary Iraqis. Saudi Arabia is also way ahead of the US in its policy toward Iran. Crown Prince Abdullah's attempts to ensure long-term Gulf security have led to a remarkable rapprochement with Tehran, ending years of stormy relations and suspicions that Iran was trying to export its Islamic revolution to the kingdom. Although US-Iranian relations have also improved since the 1997 election of reformist President Mohammad Khatami, Washington continues to impose economic sanctions on Iran, delaying the prospects for a normalisation of relations. "Iran is being treated unfairly by some countries and this is not in the interest of the Gulf or even the US," says Prince Nawaf, who is working on establishing the first Saudi-Iranian investment bank. "Iran has an important place in the region. . . we want it to be in a better economic position."