U.S. Oil Boom Shifts Alliance As Obama Visits Saudi King

  • Date: 27/03/14
  • Tara Patel and Maher Chmaytelli, Bloomberg

The U.S. energy boom that’s upended global markets is now reshaping political alliances built over decades.

Photographer: Eddie Seal/Bloomberg: Five years after Obama’s first visit to Riyadh, the drilling of shale oil fields from North Dakota to Texas has put the U.S. on the path to energy independence, weakening economic interdependence between the two nations as they work through disagreements on Syria and Iran.

When Barack Obama sits down tomorrow with Saudi Arabia’s King Abdullah, he’ll do so knowing the U.S. is importing the least crude in two decades, a shift changing America’s strongest relationship in the Arab world.

Five years after Obama’s first visit to Riyadh, the drilling of shale oil fields from North Dakota to Texas has put the U.S. on the path to energy independence, weakening economic interdependence between the two nations as they work through disagreements on Syria and Iran.

The U.S. energy boom that’s upended global markets is now reshaping political alliances built over decades. Almost 70 years after Franklin Roosevelt cemented relations with the Saudi royal family, the U.S. finds itself free to address policy differences with oil as less of a bargaining chip, analysts said. The shift gives the U.S. a freer hand in shaping Middle East policy, especially in seeking an accommodation with Iran while lessening Saudi influence in Washington.

“The global picture for Saudi Arabia has changed fundamentally as a result of the growth of unconventional oil in the U.S.,” said Valerie Marcel, an associate fellow at Chatham House, a think-tank in London. “Saudi Arabia and the rest of the Gulf exporters are turning their attention eastward and that has an impact on how they see the West.”

While the U.S. stresses the closeness of the relationship on security and counter-terrorism matters, Obama’s likely to confront discomfort on his policy toward Saudi Arabia’s main regional rival, Iran, where he’s pursuing a deal on the country’s nuclear program that may eventually end economic sanctions against the Islamic Republic.

Pursue Policies

“Because of its emerging energy independence, the U.S. may pursue policies that are not favorable to the Saudis,” said Theodore Karasik, director of research at the Institute for Near East and Gulf Military Analysis in Dubai. “It explains partially the overture to Iran.”

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