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Saudi Arabia probes attacks on oil plants

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drone attack on saudi Arabia Aramco Photo Credit: Reuters

Sep 15: The investigators are probing whether the coordinated attacks on Saudi Arabia’s Aramco oil plants was carried by cruise missiles or drones because of the extent of damage caused to the country’s vital energy assets. After US rejected Houthis claim and accused Iran of executing such act, the experts are investigating the possibility of Iran or Iraq’s role in the attack , which has the potential to destabilize the Middle East.

The coordinated drone strikes on Saudi Arabia’s Aramco oil plants on September 14 has escalated the tensions between Iran and United States Another aspect is it has the potential to impact world oil prices.

The attacks has knocked down approximately 5.7 million barrels per day (bpd) of the kingdom’s oil production and the restoration of full supply may take weeks.

Immediately after the attack, Yemen’s Houthi rebels on Saturday took responsibility for the attacks, saying 10 drones targeted state-owned Saudi Aramco oil facilities in Abqaiq and Khurais, according to the Houthi-run Al-Masirah news agency.

Hijra Khurais is one of Saudi Arabia’s largest oil fields, producing about 1.5 million barrels a day and Abqaiq, the world’s biggest crude stabilization facility, which processes seven million barrels of Saudi oil a day, or about 8 per cent of the world’s total output. The attack has disrupted about half of the Kingdom’s oil capacity, or 5 per cent of the daily global oil supply.

The Saudi Arabian government has not released any statement on the number of deaths but are assessing the damage caused by drone attacks.

Saudi-led coalition has launched probe into drone attacks after Yemen’s Houthi rebels, who took control of Yemen’s capital of Sanaa in 2014 took credit for the attack.

Houthis have been engaging in drone strikes to target Saudi Arabia before, who are at a distance of 500 miles from Yemen but the distance between Saudi Arabia-Yemen border to Khurais is about 770km.

Rejecting Houthis claim, US Secretary of State Mike Pompeo was quick to blame Iran for the drone attack at an oil field in Saudi Arabia.

“Tehran is behind nearly 100 attacks on Saudi Arabia while (President Hassan) Rouhani and (Foreign Minister Mohammad Javad) Zarif pretend to engage in diplomacy. Amid all the calls for de-escalation, Iran has now launched an unprecedented attack on the world’s energy supply,”Pompeo tweeted.”There is no evidence the attacks came from Yemen.”

In another tweet, Pompeo also called for other countries to denounce Iran in retaliation to Saturday’s attack and promised American efforts to help support the energy market.

“We call on all nations to publicly and unequivocally condemn Iran’s attacks. The US will work with our partners and allies to ensure that energy markets remain well supplied and Iran is held accountable for its aggression,” he added.

Pompeo did not provide any evidence to substantiate his accusations.
US-Iran tensions escalated after Trump unilaterally pulled out of 2015 Iran nuclear deal and in July US said Iran was behind attacks on two oil tankers in the Gulf.

There are also reports that only cruise missile can cause such a massive damage, therefore, the investigators are probing all angles involving whether the attack was orchestrated and executed either by Iran or Iraq and cruise missile were used rather than drones.

Saudi Minister of Energy, Prince Abdulaziz bin Salman publicly admitted that the state energy company Aramco, the world’s largest oil producer,had stopped the production of some 5.7 million barrels of crude, about half of its total output.

Part of the reduction will be compensated for by drawing from Aramco’s oil stocks to cover customer demand, he added.

He emphasized that the attacks also prompted Aramco to halt associated gas production of about 2 billion cubic feet per day used to produce 700,000 barrels of liquid gas, thus reducing the total supply of ethane and natural gas by up to 50 percent.

US President Donald Trump made a phone call to Saudi Crown Prince Mohamed bin Salman and acknowledged that the attack had affected both the global and the US economy.

Turki Al Maliki, the coalition spokesperson, said in a statement on the Saudi Press Agency that based on joint initial investigations with relevant authorities, the Joint Forces Command of the Coalition affirms that the investigations are ongoing. “The coalition continues to adopt and implement necessary procedures to deal with such terrorist threats in order to safeguard national assets, international energy security and ensure the stability of the world economy,” he said.

Both Iraq and Iran has denied their role in the attacks. Iran’s Foreign Minister Javad Zarif replied to Pompeo on Twitter, saying that “having failed at max pressure, Sec Pompeo’s turning to max deceit”.

Foreign ministry spokesman Abbas Mousavi said that Pompeo’s “blind accusations and remarks are incomprehensible and meaningless”. Mousavi said that it was about five years that the Saudi-led coalition has waged a full-scale war on Yemen by repeated aggression and committing atrocity crimes against the civilians.

By Arti Bali

Sr Journalist

International Affairs)

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Range-bound: Rupee caught between higher inflows, swelling reserves

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Mumbai, July 11 : The Indian rupee has been caught in a flux of higher FDI inflows and swelling foreign exchange reserves, thereby restricting its future movement around the Rs 75 per US dollar mark.

Analysts opined that the rupee is caught between higher foreign inflows and the Reserve Bank of India”s efforts to shore up reserves.

Even a lower import bill and stable exports do not seem enough for the rupee to break free from its current range.

“With the RBI continually increasing its forex reserves and investment in dollar via forward contracts, a floor seems to be place below Rs 75 levels on spot,” Anindya Banerjee, DVP, Currency and Rates, Kotak Securities, told IANS.

“The upside is also capped due to improving sentiments in the equity and bond markets. All in all, we are looking at a range of Rs 74.80 to Rs 75.80 over the next few weeks, with volatility remaining at a low.”

According to Sajal Gupta, Head, Forex and Rates, Edelweiss Securities: “The rupee appreciated swiftly to Rs 74.52 per dollar due to large FDI flows and rising equity markets and then weakened to Rs 75.20 on the back of the RBI”s efforts to mop up dollars to shore up reserves which stand at a record high of $513 billion dollars.”

“India is expected to see a Balance of Payment surplus of $60 billion this year due to lower crude price and falling imports. It is a big surprise that amid such strong FDI inflows, the rupee is still not strengthening as the RBI is mopping up all dollars to the reserves.”

Besides, he pointed out that imports have slowed down at a faster pace as domestic economy looks weaker compared with global markets.

Presently, India”s foreign exchange reserves increased by $6.416 billion during the week ended July 3.

The reserves grew to $513.254 billion from $506.838 billion reported for the week ended June 26.

Last month, official data showed India posted a marginal current account surplus in Q4FY20 on the back of a lower trade deficit, along with higher remittances, and an increase in investment flows.

The current account is the net difference between inflows and outflows of foreign currencies.

On the quarterly basis, the current account balance recorded a marginal surplus of $0.6 billion (0.1 per cent of GDP) in Q4 of 2019-20 as against a deficit of $4.6 billion (0.7 per cent of GDP) in Q4 of 2018-19 and $2.6 billion (0.4 per cent of GDP) in the preceding quarter of Q3 of FY20.

At present, India”s exports are steadily moving towards normalcy.

“Going ahead, we expect the caution surrounding the impact and duration of the novel coronavirus may keep all riskier assets on an edge, including the rupee. We see USD/INR trading between Rs 74.75-Rs 75.75,” said Rahul Gupta, Head of Research — Currency, Emkay Global Financial Services.

“Only heavy inflows may cap the upside in USD/INR spot. We recommend exporters to wait for better hedging levels as we expect the spot to appreciate; however, they can start hedging their receivables once USD/INR spot falls below Rs 75.”

(Rohit Vaid can be contacted at [email protected])

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Did Vikas Dubey reach Ujjain himself or was he brought there?

After Madhya Pradesh Home Minister Narottam Mishra announced his arrest, the Congress is raising questions.

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Vikas Dubey.

Ujjain/Bhopal, July 9 : After gangster Vikas Dubey, who had been on the run for the last seven days, was arrested in Madhya Pradesh’s Ujjain on Thursday morning, a controversy erupted over how he managed to reach the temple town. Questions have been raised whether he came on his own or was brought here, and also as to how he manage to cross many districts of Uttar Pradesh without being recognised.

Dubey, accused of killing eight police men in Bikaru village of Kanpur, was constantly changing his location for the past seven days. Though the Uttar Pradesh Police continued to raid various possible locations, he still reached Ujjain, dodging the police of several districts of UP and Madhya Pradesh.

Dubey, whose in-laws are also from Madhya Pradesh, has been coming to Ujjain every year. His mother Sarala Devi had admitted that he used to go to Ujjain every year to offer prayers at Mahakaal temple. It is being said that he reached Ujjain by road and also offered prayers at the temple on Thursday morning.

After Madhya Pradesh Home Minister Narottam Mishra announced his arrest, the Congress is raising questions.

Police sources said that Dubey came to Ujjain in a car from Uttar Pradesh and he also stopped at a residence of a person known to him in Nagjhiri area where he stayed for some time. He reached the temple for ”darshan” on Thursday morning. However, the security guards posted at the temple got suspicious and stopped him for questioning. He reportedly had a brief scuffle with the security guards who then informed the police post. Dubey was later arrested there.

But if Dubey did actually come to Ujjain by road, then he must have covered a distance of about 200 km in Madhya Pradesh seemingly without attracting police attention. Before entering Madhya Pradesh, he must have passed through several districts of Uttar Pradesh as well. Apprehension has been expressed that he reached Ujjain via Rajasthan”s Kota. The police is investigating this also.

Mishra said that Dubey came to Ujjain driving his own vehicle. “Two of his accomplices — Bittu and Suresh have also been arrested. The entire state police was on alert after the Kanpur incident. The surveillance was carried out and finally MP police succeeded in arresting him.”

However, questioning the government, Congress Rajya Sabha member and former Chief Minister Digvijaya Singh said: “It looks like a sponsored surrender to avoid an encounter by the Uttar Pradesh Police. My information is that this has been possible with the courtesy of a senior leader of Madhya Pradesh BJP.”

However, it was not immediately known whether Dubey reached Ujjain on Thursday morning itself or had come a day before.

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Xi Jinping: The Chinese Hitler leading PRC to disaster

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Chinese President Xi Jinping is unfairly using early recovery from pandemic for external encroachment and internal consolidation.Chinese aggression in all domains will be rebuffed globally, led by powers suffering the most.

Xi Jinping”s over ambition and lust for power has been emboldened by mute tolerance in CPC and PRC. His adventurism is leading China to disaster, unless the Chinese reins its leadership.Backdrop

History is full of examples whenever the ambition of any autocrat grew beyond global tolerance, he became responsible for collapse of his regime, resulting in disaster of the country and population, which emboldened him by mute tolerance. Today, despite facing unprecedented global anger for being the originator of novel coronavirus, the aggressiveness of Chinese leadership on multiple fronts to suppress internal and external dissent has pushed the world against itself. Xi Jinping”s unfair adventurism for incremental encroachment to all his ever increasing claim areas in continental and maritime domain, at a time when other countries are suffering from most dangerous pandemic of the century, with death toll rising every day, is amounting to inhuman aggression, junking all morals, international conventions, rules, treaties and forcing the world to reluctantly react against his regime.

Xi Jinping”s Overambition

Xi started his term by dream-selling to pull China out of poverty line by 2020. Internationally he projected himself as the crusader for world peace and climate change(despite junking the ruling of PCA and violating UNCLOS), with a resolve to push through Belt and Road Initiative (BRI) to fulfil Chinese dream of rejuvenation, after century of humiliation. As ”Chairman of Everything” he indirectly declared himself as the tallest leader on the planet, got himself re-elected for second term and did everything to make himself great, under the banner of ”Making China Great”. He assumed that the world will accept him as tallest autocratic leader, as Chinese people accepted him, without worthwhile checks and balances. His anti-corruption drive systematically eliminated the entire dissenting elements and all his possible competitors.

China: Boiling Pressure Cooker with no Safety Valve

Xi took over in 2012 as President with 7.9 per cent GDP growth and led China to economic downslide thereafter. With failing BRI, mishandling of COVID-19, there is no worthwhile achievement to his credit except that he managed to eliminate dissenting elements. His critiques in the CPC feel that his real achievements do not match his elevation to the status of MaoZedang, which has created some disgruntled elements/lobbies, who are still under check due to his comprehensive surveillance, because disagreeing with Xi ”The Core” is anti-national and leads to jail.

It is quite clear to Xi Jinping and CPC, that if he fails economically, and the educated people of China don”t get a decent life, they may not tolerate his autocracy, having no worthwhile grievance redressal mechanism and the democratic winds will start flowing from Hong Kong and Taiwan. The legal system stands hostage to party leadership justifies the boiling pot theory; hence the biggest threat to China comes from within. Some of his actions like laying restrictions on religious practices on Uyghurs” and their forced abortions in Xinjiang, use of force in implementing draconian National Security Law in Hongkong are too risky. The strict censorship of media and internet, electronic isolation, social engineering to bring societal changes are unpopular steps to minimize unrests.

Why over-ambitious Xi Opening Multiple Fronts?

The viability of ”Implosion theory” is feared to be a reality by a totalitarian regime; hence a dose of nationalism nurtured through external aggression, suits Xi Jinping”s hold on power, besides making best use of early recovery from COVID-19 in comparison to his competitors. China has unfairly used it as an opportunity to assert itself on multiple fronts, including India-China land borders to scrumptiously encroach some area not supposed to be held, as per the mutually agreed CBMs, where both sides were free to patrol. This is a sequel to the Chinese adventurism in Indo-Pacific at multiple places in South and East China sea with greater assertion against other claimants like Vietnam, Indonesia and Philippines. The rationale of China being over assertive at the time of pandemic comes from Sun Tzu”s thoughts of ”Strike adversary when it”s weak and preserve yourself when it is strong”. China is therefore speeding up its Incremental Encroachment Strategy in South China Sea as well as LAC.

The strategic calculations seem to be ambitious, as in authoritarian state, the sycophancy prevents leaders getting objective advices from subordinate strategists. When Hitler launched offensive in Russia in World War II, beyond its logistics limit for sustaining in winters, he overruled advices of subordinates and brought Germany to disaster.

In case of China, Xi emboldened by modernised arsenal and extensive exercises and propaganda is planning to take on some of the most experienced troops, despite not having a single pilot in the PLA with any operational experience. While its density of arsenal in South China Sea and Eastern Sea board looks impressive, but its vulnerability of long Sea lanes of Communications in Malacca strait and the Indian Ocean, coupled with blockading of its naval bases by hostile navies can draw out PLA out of its comfort zone, where it is no match to combined navies of hostile countries, including the US spending four to five times of China on defence over so many decades. The strong military posturing by navies from the US, Australia, Japan, and regional claimants of South China Sea enough for deterrence and accidental engagement, because an all-out war is recipe for mutually assured destruction (MAD), which even Beijing cannot afford given the fact that it faces potent nuclear and space power.

Contours of Undeclared Third World War

The forced occupation of landmass by China in terms of features in South China Sea claimed by others junking PCA ruling, has graduated to skirmishes. The dimensions of warfare to include economic war, cyber and information war, biological war by asymmetrical impact of COVID-19, resulting many more deaths than all world wars put together, large scale military posturing in Indo-Pacific and physical land grab offensive by China in Ladakh, using pandemic as a weapon.

The possible alliances also seem to be on the horizon seemingly China, Pakistan and North Korea taking on competitors of China and everyone else in the world not agreeing to Chinese narrative. The current global situation has every element of a World War, except that the dimension, instruments and modalities have changed from conventional war, and the war has not been ”Formally Declared”; hence it may well be called as ”Undeclared Third World War with Changed Instruments and dimensions”. The world has already entered in preparatory phase of it, without recognising it to be so.

Pattern of Global Reaction

In continental domain its land grab efforts in Ladakh have been rebutted by India, which honoured its 20 fallen soldiers with state honours, whereas the PLA chose to hide its fallen soldiers much more in number, creating another wave of anger amongst the PLA veterans. The mutual disengagement is being viewed with suspicion as PLA demonstrated its unprofessionalism to the world by using barbaric tools for attacking Indian soldiers, junking the CBMs and yet bought heavy casualties. India is certainly not going to take mini disengagement gestures for granted, unless PLA withdraws to pre-standoff positions; hence will be ready to respond with all options on the table.

In maritime front, the US has already demonstrated strong military posturing. The ASEAN, which was muted by China so far, by consolation of draft Code of Conduct and purse diplomacy, combined with coercion due to large power asymmetry, seems emboldened to talk about UNCLOS, demanding fair share of EEZ of affected countries. Taiwan, emboldened by national sentiments, leadership, the US support through Taiwan Relation Act and NDAA has started identifying itself as a nation, junking ”One country Two systems”, ready to defend itself should a situation arise, besides granting asylum to willing people from Hong Kong. Japan is looking for strengthening its defence capabilities. Some more adventurism by North Korea may see Japan going nuclear in future. Xi Jinping”s ambition has costed global loss of trust and some important markets for China. Russia and Iran have a forced marriage with China, due to sanctions from the West, but given the geo-strategic situation, playing neutral, along with sale of weaponry/oil may be the best option for them.

China may be able to implement the draconian National Security Act in Hong Kong, but global reaction is unavoidable. China has to bear the cost of demise of its financial hub, with many countries inclined for economic distancing, shifting FDI, banning concessions granted to Hong Kong, granting citizenship to those willing to exit, thus creating ideal conditions for urban insurgency in times to come, besides the rural insurgency of Xinjiang. Suddenly the voices in support of Uighurs and Tibetans and questions on ”One China Policy” have started becoming active, notwithstanding the threats of Chinese wolf warrior diplomats.

Future of China under over-ambitious Xi

Xi Jinping”s Chinese dream of ”Rejuvenation” and his aim of ”Prosperous Developed Society” with a ”War Winning Modern PLA” by 2050 was achievable, had he not harboured dictatorial over ambition to achieve these aims and dislodge the US as a superpower, making unfair use of pandemic. In fact, the first major conversion of features in South China Sea to military bases took place during the last US elections, with no big bang action from the US. This emboldened Xi to use pandemic unfairly to fulfil all his aims before time, without having capacity to protect its global shipping outside its eastern seaboard. With the kind of global anger he has generated against his regime, the lesson of diversification of global factory for the world, along with need of economic distancing from China has become evident. Xi has thus pushed his country on a path to disaster unless Chinese people wake up and shake up the CCP and rein their leadership to protect their dreams.

Takeaway for India

From the Indian perspective, this is the time when Beijing is under maximum external and internal pressure since last five decades. If Beijing continues with its high headedness, it will invite further pressure. This may well be the time to push through border settlement or demarcation of LAC as the political cost of resolving the border/LAC may be lesser than an active front with India. India should not settle down with token disengagement because unless the LAC is demarcated the standoffs will continue. For the time being India should not blink at the borders.

(Major General S. B. Asthana, SM, VSM Veteran is the Chief Instructor, United Service Institution of India. The views expressed here are his personal views.)

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