Saudi Arabia threatened the world economy if the United States questioned what happened to 59-year-old Washington Post journalist Jamal Khashoggi after disappearing Oct. 2 from the Saudi consulate in Instabul. Media reports indicate that Khashoggi was assassinated by a 15-member Saudi hit squad in the consulate, dismembered, relocated and disposed of secretly. Saudi officials deny the charges, calling them scurrilous rumors spread by their enemies. President Donald Trump told CBS’s “60 Minutes” today that Saudi Arabia will face “severe punishment” if-and-when the extra-judicial assassination of a Khashoggi is verified. U.S. and British lawmakers warned Saudi Arabia of severe consequences should Khashoggi’s assassination prove to be a state-sponsored hit on the Washington Post journalist who reported critical stories about Saudi Defense Minister Crown Prince Mohammed bin Salman.
Calling the allegations “baseless,” the Kingdom rejected out of hand any speculation about Khashoggi’s disappearance. While there’s video evidence of Khashoggi going into the consulate, there’s no video record of him leaving. Newspaper reports from Istanbul suggest that there’s video and audio proof of Khashoggi’s interrogation, torture and murder inside the Saudi consulate Oct. 2. Whether that’s true of not is anyone’s guess. What’s known for sure is that Khashoggi disappeared from the Saudi consulate Oct. 2, and the Saudi government wants no part of the investigation into his disappearance. Outraged by the event, several countries have pulled out the “Davos in the Dessert” economic summit in Riyadh this month. Saudi’s stock exchange lost 264 points or 4% Oct. 12, as investors bailed out of shares. If Bin Salman is found guilty of an extra-judicial assassination, things could get worse.
Riyadh hasn’t come to grips with the gravity of the situation, thinking they can intimidate the world leaders into letting it go. Principled governments like the U.S. and U.K. can’t turn a blind eye to what’s regarded as unthinkable international behavior. Trump said he’d like to continue the billions in U.S. military sales with Saudi Arabia, no matter what happens. He knows the Congress could put the kibosh on future U.S. arms sales, if Bin Salman’s found responsible for Khashoggi’s death. “Something this big would definitely spook investors, and Saudi just opened up for foreign direct investment, so that was big,” said Issam Kassabieh, a Dubai-based financial analyst with Menacorp Finance. “Investors do not feel solid in Saudi yet, so it’s easy for them to take back their funds.” When you consider the lawlessness of a Saudi hit squad traveling to Istanbul to kill Khashoggi, it’s intolerable.
Trump knows that his talk of continuing arms sales to Saudi Arabia won’t be business-as-usual if the Kingdom assassinated Khashoggi. ‘There’s something really terrible and disgusting about that, if that was the case, so were going have to see,” said Trump, reluctant to rush-to-judgment. “We’re going to get to the bottom of it, and there will be severe punishment,” Trump said, silencing critics who say the U.S. must take a principled stand. Responding to Trump’s warning, the Kingdom issued its own. Saudi officials threatened to take even tougher action on any country imposing economic sanctions on the Kingdom. “The Kingdom affirms its total rejection of any threats and attempt to undermine it, whether by threatening to impose economic sanctions, using political pressures or repeating false accusations,” reported Saudi’s Press Agency, warning the West not to act.
Saudi Arabia should think twice about throwing down the gauntlet to Trump, someone not prone to back down. Hinting at a new oil embargo, Saudi Arabia hasn’t come up to speed that the U.S. no longer imports oil from the Kingdom. U.S. governments in Saudi’s first oil embargo in 1973 have learned valuable lessons, never again be dependent on the Kingdom for oil. Other countries in the European Union, China and India, don’t have the same luxury of buying oil from its friendly neighbors, Mexico and Canada, and producing more domestic oil and gas than ever before. With oil around $73 a barrel, Saudi’s threat of a new oil embargo could spike oil over $100 a barrel, even higher. “If the price of oil reaching $80 angered President Trump, no one should rule out the prince jumping to $100 or $200 or even double that figure,” said, Saudi journalist Turki Aldakhil.
Threatening to break arms contracts with the U.S., Saudi Arabia has drawn its line in the sand when it comes to Khashoggi. Bin Salman thinks that threatening the West to stand down will work for profit-obsessed capitalists. “The truth is that if Washington imposes sanctions on Riyadh, it will stab its own economy to death, even though it thinks that it is stabling only Riyadh,” Aldakhil said, putting out Bin Salman’s warning. What the Saudis don’t get is that not everyone in the U.S. can be bought by threats of economic harm. No matter what the damage to the U.S. economy, members of Congress won’t want to do business with Saudi Arabia if it’s guilty of Khashoggi’s death. If Bin Salman gets too big for his britches, Trump has more than economic sanctions at his disposal. Threatening Trump with a new oil embargo won’t stop the U.S. and its allies from finding out what happened to Khashoggi.
