Jim Hoagland suggests Saudi Arabia is putting the squeeze on Iran in a way it is uniquely able: "Saudi Arabia is finally worried enough about Iran to use oil as a weapon against the regime of President Mahmoud Ahmadinejad. Saudi oil minister Ali Nuaimi publicly opposed Iranian calls for production cuts by the OPEC cartel to halt a decline that has taken crude oil from $78 a barrel in July to just above $50 a barrel last week. The Saudis have enough reserve production capacity to swing OPEC prices up and down at will. Their relatively small population gives them a flexibility in postponing revenue gains that populous Iran lacks. Nuaimi's pronouncement, although cast as a technical matter that had nothing to do with politics, seemed to give teeth to recent warnings issued in private by Prince Bandar bin Sultan..." More here.

Posted by Laura at January 21, 2007 05:19 PM