We have recently witnessed many 'firsts' such as one of the largest storms in the Pacific, the most severe acute health risk in modern times, and a global financial system on the brink of collapse.
Sunni and Shia Muslims have lived peacefully together for centuries. In many countries it has become common for members of the two sects to intermarry and pray at the same mosques. They share faith in the Quran and the Prophet Mohammed's sayings and perform similar prayers, although they differ in rituals and interpretation of Islamic law. But... An ancient religious divide is helping fuel a resurgence of conflicts in the Middle East and Muslim countries. Islam's schism, simmering for fourteen centuries, doesn't explain all the political, economic, and geostrategic factors involved in these conflicts, but it has become one prism by which to understand the underlying tensions.
A week ago we noted how critical the seige in Kobani was (and why it suggested President Obama's strategy was a fiasco given a lack of commitment from supposed allies such as Turkey). 7 days later.. and America's plans to fight Islamic State are in ruins as the militant group's fighters come close to capturing Kobani and have inflicted a heavy defeat on the Iraqi army west of Baghdad. While John Kerry has today stated, "Kobani does not define strategy against Islamic State," the 'loss' is symbolic as The Independent's Patrick Cockburn notes, in both Syria and Iraq, ISIS is expanding its control rather than contracting.
We first exposed the "secret" US-Saudi deal in September which led to the inevitable bombing of Syria. We then progressed to explain the quid pro quo of the deal in lower oil prices (benefiting US consumers into an election and crushing Russian revenues). In today's Wall Street Journal we get the final piece of the puzzle as it is clear that what Saudi Arabia loses in 'price' it will make up in 'volume' as The Kingdon is taking the unusual step of asking buyers to commit to maximum shipments if they want to get its crude. Simply put, "they are threatening [European] buyers" to discontinue sales if they don't agree with the full fixed deliveries. The 'oil weapon' grows stronger...
What if there was some degrees of freedom in the centrally planned capital markets that rational, non-emotional and non-ideologically-laden thinking could shed light on ? Here is such an attempt
Two weeks ago, we revealed one part of the "Secret Deal" between the US and Saudi Arabia: namely what the US 'brought to the table' as part of its grand alliance strategy in the middle east. What was not clear is what was the other part: what did the Saudis bring to the table, or said otherwise, how exactly it was that Saudi Arabia would compensate the US for bombing the Assad infrastructure until the hated Syrian leader was toppled, creating a power vacuum in his wake that would allow Syria, Qatar, Jordan and/or Turkey to divide the spoils of war as they saw fit. The full answer comes courtesy of Anadolu Agency, which explains not only the big picture involving Saudi Arabia and its biggest asset, oil, but also the latest fracturing of OPEC at the behest of Saudi Arabia which however is merely using "the oil weapon" to target the old slash new Cold War foe #1: Vladimir Putin.
It was heinous. It was underhanded. It was beyond the bounds of international morality. It was an attack on the American way of life. It was what you might expect from unscrupulous Arabs. It was “the oil weapon” -- and back in 1973, it was directed at the United States. Skip ahead four decades and it’s smart, it’s effective, and it’s the American way. The Obama administration has appropriated it as a major tool of foreign policy, a new way to go to war with nations it considers hostile without relying on planes, missiles, and troops. It is, of course, that very same oil weapon.
- It wasn't Obama this time: Pakistani teen, Indian activist win Nobel Peace Prize (Reuters)
- Surging VIX Shakes Bulls as S&P 500 Charts Go Haywire (BBG)
- Global shares hit six-month low as growth worries mount (Reuters)
- Police, protesters clash in St. Louis ahead of weekend of rallies (Reuters)
- We're Sitting on 10 Billion Barrels of Oil! OK, Two (BBG)
- Spain seeks answers as seven more enter Ebola isolation (Reuters)
- Iran will sell its oil to Asia in November at the biggest discount (BBG)
- Redefining honeypot: U.S. DEA 'most interested' in U.S. investors in Canadian marijuana firms (Reuters)
- UKIP Wins First Commons District With Conservative Defector (BBG)
- Fake Ebola Patients Help Hospitals Prepare for Next Case (BBG)
Thesis: Oil supply is where the pressure is coming from and the China-Russian oil deal has not undermined the dollar, but OPEC.
The modern Turkish government is looking at Iraq and Syria in a way similar to how Damat Ferid did almost a century ago when he sought in Paris to maintain Turkish sovereignty over the region. From Ankara's point of view, the extension of a Turkish sphere of influence into neighboring Muslim lands is the antidote to weakening Iraqi and Syrian states. However, the Turkish vision of the region simply does not fit the current reality and is earning Ankara more rebuke than respect from its neighbors and the West. The Kurds, in particular, will continue to form the Achilles' heel of Turkish policymaking. This is the crowded battleground that Turkey knows well. A long and elaborate game of "keep away" will be played to prevent the Kurds from consolidating control over oil-rich territory in the Kurdish-Arab borderland, while the competition between Turkey and Iran will emerge into full view.
Ranking 5th in the world for 'executions', as we noted previously, the US is among proud executing-nations like Iran, Saudi Arabia, and China. But when we drill down, there are a handful of states that are carrying the 'execution' weight for the rest of America as they try to reach #1 in the world (even as fewer Americans support the death penalty)...
large explosion took place near a suspected nuclear site in Iran has reportedly killed two people and according to the Washington Free Beacon, prompted speculation of sabotage at a military site long suspected of housing Tehran’s clandestine nuclear activities, according to Iran’s Defense Industries Organization (DIO), which operates under the country’s Ministry of Defense. The Free Beacon, citing Fars New Agency, reports that one explosion rocked a production plant late Sunday night in east Tehran, near the Parchin nuclear site. The explosion at a facility referred to as a “production plant” caused a fire that killed two workers, according to Fars, which cited information provided by Iran’s DIO. Fars first reported news of the explosion, claiming that it took place at an “explosive material factory” near Parchin. According to Iran opposition sources, the blast killed at least four military personnel.
Another humanitarian catastrophe may be just hours away at Kobani - a Syrian Kurdish town on the border with Turkey that is now surrounded by ISIS tanks and is being pounded day after day by ISIS heavy artillery. Already this lethal phalanx, which fuses 21st century American technology and equipment with 12th century religious fanaticism, has rolled through dozens of Kurdish villages and towns in the region around Kobani, sending 180,000 refugees fleeing for their lives across the border. Self-evidently the lightly armed Kurdish militias desperately holding out in Kobani are fighting the right enemy - that is, the Islamic State. So why has Obama’s grand coalition been unable to relieve the siege?
Violence Erupts As Hong Kong's Leader Threatens To Use "All Necessary Measures To Restore Social Order"Submitted by Tyler Durden on 10/04/2014 16:00 -0500
Having tried (unsuccessfully) to break up the pro-democracy protesters in the heart of Hong Kong using local triad gangs (as opposed to the optics of actual police), it appears the Chinese government is rolling back from its "wait-and-see" approach and becoming more aggressive once again. Hong Kong's Chief Executive Leung Chun-ying, as DPA reports, demanded protesters end their blockade of major roads by Monday, or the government will take "all necessary measures to restore social order." Tensions continue to rise, with clashes breaking out sporadically, as the protesters have broken off talks with the government. As fears of another Tiananmen square debacle loom, former Hong Kong governor Chris Patten noted, "I cannot believe it would be so stupid as to do anything like send in the army."
“The crude is transported by tankers to Jordan via Anbar province, to Iran via Kurdistan, to Turkey via Mosul, to Syria's local market and to the Kurdistan region of Iraq, where most of it gets refined locally... Turkey has turned a blind eye to this and may continue to do so until they come under pressure from the West to close down oil black markets in the country's south.”