Before heading to Saudi Arabia, Biden backs 2-State solution in Israel

  • Biden Backs 2-State Solution, Visits East Jerusalem Before Heading to Saudi Arabia
  • For the first time, a US president visited East Jerusalem, sending a signal to Israel that part of the city could be the future capital of a Palestinian state. There, while visiting Augusta Victoria hospital, Biden pledged $100 million for Palestinian healthcare in East Jerusalem.
  • Next, Biden headed to Bethlehem to meet with Palestinian President Mahmoud Abbas and advocated for a two-state solution to the Israeli-Palestinian conflict. However, he made no promises for renewed peace talks between Israelis and Palestinians, saying the ground is “not ripe” for negotiations.
  • After Israel comes from perhaps the most challenging part of his Mideast trip. The president going to Saudi Arabia, a country he once called a “pariah” due to its human rights record and connections to the murder of journalist Jamal Khashoggi.

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Lack of wind in Texas: Green Energy falls short as officials tell consumers to conserve energy

Rev 6:6 NAS “And I heard something like a voice in the center of the four living creatures saying, “A quart of wheat for a denarius, and three quarts of barley for a denarius; and do not damage the oil and the wine.”

Important Takeaways:

  • Texas Tells Consumers to Conserve Electricity as Wind Energy Falls Short
  • The Electric Reliability Council of Texas (ERCOT) has warned power consumers in Texas to conserve energy on Monday afternoon and evening because there will not be enough wind power to operate the power grid reliably in peak demand.
  • This week, Biden will go, cap in hand, to Saudi Arabia, to ask it to produce more oil, after his administration has taken steps to reduce domestic oil and gas production.

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Gulf Arabs jittery about Taliban takeover but may seek pragmatic ties

By Aziz El Yaakoubi, Alexander Cornwell and Marwa Rashad

DUBAI (Reuters) – Saudi Arabia and the United Arab Emirates, among the few who recognized the Taliban’s radical 1996-2001 rule in Afghanistan, will likely take a pragmatic approach to its return to power despite fears it could embolden militant Islam abroad.

Foreign diplomats and analysts said while Taliban ideology clashed with the Saudi-UAE campaign against militancy and with Riyadh’s recent relaxation of Islamic strictures, Riyadh and Abu Dhabi would adapt to realities after the Taliban’s shockingly swift reconquest of Afghanistan as U.S.-led forces withdrew.

Gulf powers severed ties with the Taliban in September 2001 for “harboring terrorists” after airplanes hijacked by al Qaeda militants, mostly Saudi nationals, crashed into New York’s World Trade Center and Washington’s Pentagon, killing thousands.

Riyadh had already frozen ties with the Taliban in 1998 over its refusal to hand over then-al Qaeda leader Osama bin Laden, who made his name fighting Soviet occupation in Afghanistan in the 1980s and was stripped of his Saudi citizenship for attacks in the kingdom and activities against the royal family.

“The Saudis have a historical relationship with Afghanistan and will eventually have to accept the Taliban (again)…They have no other option,” said a foreign diplomat in Riyadh, who like others asked not to be further identified.

Whether pragmatism will extend to a re-establishment of diplomatic relations is unknown: Saudi and UAE authorities did not respond to Reuters requests for comment regarding Afghanistan and the Taliban.

Riyadh and Abu Dhabi have limited their response to the Taliban takeover to saying they would respect the choice of Afghans and urging the group to foster security and stability after a protracted insurgency against U.S.-backed rule.

“Both countries are pragmatic and have proven they can work with different regimes around the world,” a diplomat based in Qatar said.

Saudi Arabia and the UAE tried to facilitate inter-Afghan peace talks after the fall of the Taliban 20 years ago, but were not involved in the main negotiations hosted by Qatar that failed to yield a political settlement.

Sheikh Hamad bin Jassim Al Thani, a Qatari ruling family member and former premier, said countries will have to deal directly with the Taliban.

“The world should respect the current situation in Afghanistan and not take measures to restrict them (Taliban),” he tweeted on Wednesday. “The international community should give them hope that it will accept them and cooperate with them in return for their commitment to international norms.”

Two diplomats in Qatar, where the Taliban maintain a representative office, said Gulf states were likely to take their cue from top security ally the United States. Washington has not said whether it would recognize a Taliban government.

UNIQUE SAUDI SWAY?

Saudi Arabia could try to exert a moderating influence on the Taliban with its status as custodian of Islam’s two holiest sites, said Umar Karim, a fellow at the Royal United Services Institute for Defense and Security Studies.

Saudi Crown Prince Mohammed bin Salman has also acted to ease restrictions on daily life in the conservative kingdom – the birthplace of Islam, including curbing the powers of religious police, permitting women to drive and allowing public entertainment.

“Saudi Arabia still has a strong religious card vis-à-vis the Taliban,” Karim said, suggesting that Riyadh could also open channels with the group via Pakistan.

Afghanistan has a long border with Pakistan, which long sheltered Taliban leaders and has long-standing ties with Riyadh and Abu Dhabi. Pakistan was the only other country to formally recognize the previous Taliban regime.

The Saudis and UAE could also use their financial clout as leverage as they have in the past, with the Taliban likely to be critically short of cash to govern the country given that Kabul’s foreign currency reserves are parked in the United States, out of reach.

TALIBAN 2.0?

Three foreign diplomats in Abu Dhabi said the UAE had privately voiced concern that Afghanistan under the Taliban could once again become a safe haven and breeding ground for extremists.

“Terrorist groups may use (Afghanistan) as a base if global powers cannot negotiate with the Taliban on (the transition of power) quickly,” columnist Yousef al-Sharif wrote in UAE newspaper Al Bayan.

“The international community must contain the situation and learn from the catastrophic failure of the American experience.”

The Taliban have sought to present a more conciliatory face since taking control, saying they will not allow Afghanistan to be used to launch attacks on other nations and will respect rights of women within the framework of Islamic law.

Initial international reaction has been deeply skeptical.

“The arrival of the Taliban in Kabul means extremism is in the seat of power,” Saudi commentator Faheem Al Hamid wrote in Okaz newspaper. He said any new civil war in Afghanistan would draw in foreign players including neighboring Shi’ite Muslim Iran, long at odds with the Sunni Taliban.

“Much is required from the Taliban. Not only backing up words with action, but also changing the extremist thought rooted in their ideology…towards tolerance and moderation.”

Saudi Arabia and the UAE have long strived to contain political Islamists they deem a threat to Gulf dynastic rule, including the Muslim Brotherhood, in Libya, Sudan, Syria and elsewhere in the Middle East and North Africa.

(Reporting by Aziz El Yaakoubi, Alexander Cornwell and Marwa Rashad; Editing by Ghaida Ghantous and Mark Heinrich)

Saudi Arabia threatens 3-year travel ban for citizens who visit “red list” states

LONDON (Reuters) – Saudi Arabia will impose a three-year travel ban on citizens travelling to countries on the kingdom’s ‘red list’ under efforts to curb the spread of coronavirus and its new variants, state news agency SPA said on Tuesday.

It cited an unnamed interior ministry official as saying some Saudi citizens, who in May were allowed to travel abroad without prior permission from authorities for the first time since March 2020, had violated travel regulations.

“Anyone who is proven to be involved will be subject to legal accountability and heavy penalties upon their return, and will be banned from travel for three years,” the official said.

Saudi Arabia has banned travel to or transit at a number of countries including Afghanistan, Argentina, Brazil, Egypt, Ethiopia, India, Indonesia, Lebanon, Pakistan, South Africa, Turkey, Vietnam and the United Arab Emirates.

“The Ministry of Interior stresses that citizens are still banned from travelling directly or via another country to these states or any other that has yet to control the pandemic or where the new strains have spread,” the official said.

The kingdom, the largest Gulf state with a population of some 30 million, on Tuesday recorded 1,379 new COVID-19 infections, bringing its total to 520,774 cases and 8,189 deaths.

It saw daily infections fall from a peak above 4,000 in June 2020 to below the 100 mark in early January.

(Reporting by Marwa Rashad; additional reporting by Raya Jalabi; Editing by Steve Orlofsky)

President-elect Raisi backs nuclear talks, rules out meeting Biden

By Parisa Hafezi

DUBAI (Reuters) -President-elect Ebrahim Raisi on Monday backed talks between Iran and six world powers to revive a 2015 nuclear deal but flatly rejected meeting U.S. President Joe Biden, even if Washington removed all sanctions.

In his first news conference since he was elected on Friday, the hardline cleric said his foreign policy priority would be improving ties with Iran’s Gulf Arab neighbors, while calling on Iran’s regional rival Saudi Arabia to immediately halt its intervention in Yemen.

Raisi, 60, a strident critic of the West, will take over from pragmatist Hassan Rouhani on Aug. 3 as Iran seeks to salvage the tattered nuclear deal and be rid of punishing U.S. sanctions that have crippled Iran’s economy.

“We support the negotiations that guarantee our national interests … America should immediately return to the deal and fulfill its obligations under the deal,” he said.

Negotiations have been under way in Vienna since April to work out how Iran and the United States can both return to compliance with the nuclear pact, which Washington abandoned in 2018 under then-President Donald Trump before re-imposing sanctions on Iran.

Iran has subsequently breached the deal’s limits on enrichment of uranium, designed to minimize the risk of it developing nuclear weapons potential. Tehran has long denied having any such ambition.

Raisi said Iran’s foreign policy would not be limited to the nuclear deal, adding that “all U.S. sanctions must be lifted and verified by Tehran”.

Iranian and Western officials alike say Raisi’s rise is unlikely to alter Iran’s negotiating stance in talks to revive the nuclear deal – Iran’s hardline Supreme Leader Ayatollah Ali Khamenei has the final say on all major policy.

Asked if he would meet U.S. President Joe Biden if those sanctions were lifted, Raisi answered: “No.”

RIGHTS AND REGIONAL POLICY

Raisi is under U.S. sanctions over a past which includes what the United States and human rights groups say was his involvement in the extrajudicial killing of thousands of political prisoners in the Islamic Republic in 1988.

When asked about human rights groups’ allegations that he was involved in the killings, he said: “If a judge, a prosecutor has defended the security of the people, he should be praised.”

“I am proud to have defended human rights in every position I have held so far,” he said.

Gulf Arab states have said it would be dangerous to separate the nuclear pact from Tehran’s missile program and “destabilizing” behavior in the Middle East, where Tehran and Riyadh have fought decades of proxy wars, in countries from Yemen to Iraq.

Echoing Khamenei’s stance, Raisi said Iran’s “regional activities and ballistic missile program” were non-negotiable.

A Saudi-led coalition intervened in Yemen’s war in 2015 after Iran-backed Houthi forces drove its government out of the capital Sanaa. The conflict has been largely stalemated for several years.

“They (the United States) did not comply with the previous agreement, how do they want to enter into new discussions?” he said.

Sunni Muslim Saudi Arabia and Shi’ite Iran, which severed ties in 2016, began direct talks in Iraq in April aimed at containing tensions. “The reopening of the Saudi embassy is not a problem for Iran,” said Raisi.

(Reporting by Parisa Hafezi; writing by Raya Jalabi and Parisa Hafezi; Editing by Mark Heinrich and Timothy Heritage)

Battle for Yemen’s Marib scrambles U.S. push for truce

By Jonathan Landay and Aziz El Yaakoubi

DUBAI (Reuters) – The battle for Yemen’s gas-rich Marib region is complicating U.S. efforts to reach a ceasefire needed to end a six-year-old war and secure a foreign policy win for President Joe Biden, two sources familiar with the talks and a diplomat said.

A U.N./U.S. peace initiative presented by Saudi Arabia in March proposed a nationwide ceasefire and the reopening of air and sea links, to bolster efforts to end a devastating conflict widely seen as a proxy war between Saudi Arabia and Iran.

Riyadh, which leads a military coalition battling Yemen’s Houthi movement, has been under increasing pressure to end the war since Biden signaled Washington would no longer support the intervention and as the United Nations warns of looming famine.

But the initiative has been stuck since Yemen’s Iran-aligned Houthis made a series of counter-proposals, including for a phased truce that could allow them sufficient time to seize Marib, the Saudi-backed government’s last northern stronghold.

Potentially crippling the peace initiative, fighting has intensified in recent days as the Houthis push their offensive to take Marib, which if successful would strengthen the movement’s hand in any future political negotiations.

“Probably the Houthis, given a choice between a ceasefire and taking Marib, would choose to take Marib,” said a senior diplomat based in the region.

The peace initiative can only be saved by a “mutually hurting stalemate” in which Houthi losses reach a point where they lose tribal support, the diplomat said, adding the group has replaced seasoned fighters lost to coalition bombs with inexperienced youth.

BLOCKADE

U.S. envoy Tim Lenderking and U.N. envoy Martin Griffiths have been touring the region for discussions to try to break the deadlock and secure a ceasefire, but so far without success.

The U.N./U.S. initiative would reopen Sanaa airport, and allow fuel and food imports through Hodeidah port, both of which are controlled by the Houthis. But the movement said last month that these steps would not go far enough.

Two people involved in the talks told Reuters the main issue now is sequencing, since the Houthis insist on a full lifting of the blockade followed by a gradual ceasefire: a halt to Houthi attacks on Saudi Arabia and coalition airstrikes on Yemen, and then a truce with Yemen’s government.

Coalition airstrikes are the only thing keeping Marib, home to major oil and gas fields, from falling, since Houthi forces, now 15 km (9 miles) west of the city, have more advanced weaponry than pro-government troops, military sources said.

Hundreds of fighters from both sides have been killed in the desert plain, but military and local sources say the Houthis have lost more in the war’s most deadly clashes since 2018.

The Houthis, who seized swathes of Yemen’s conventional military when they ousted the government from the capital Sanaa in late 2014, have sent thousands of fighters to the Kasara and Mushaja areas near Marib city whose terrain provides some cover, pro-government military and local sources said.

The fighting has displaced some 13,600 people in the region since February, according to the United Nations, which said four displacement camps were shut after being hit by shelling, injuring dozens and compounding overcrowding.

Marib hosts a quarter of Yemen’s four million refugees.

The war has killed tens of thousands of people in Yemen, and caused what the United Nations describes as the world’s largest humanitarian crisis with millions facing famine.

But Saudi Arabia has also felt the impact of the war. It has faced a barrage of Houthi drone and missile strikes, and is seeking security guaranties along its border as it tries to contain the influence of arch-rival Iran.

‘KNOCKOUT BLOW’

Saudi and Iranian officials discussed Yemen during direct talks this month aimed at easing tensions, six years after diplomatic ties were severed, sources said.

Michael Knights, an expert on Gulf military affairs with the Washington Institute for Near East Policy, said Saudi Arabia has enough reserves of U.S.-supplied precision-guided munitions to keep defending Marib, but time remained a factor.

The Houthis, who already control most big urban centres, have a window of time to press their offensive during hazy summer weather that reduces coalition air operations.

“If the Houthis take it, they’re going to take it in the next three months,” Knights said, adding that the group is advancing in pulses to seize ground and reinforce positions.

“The Houthis view Marib as a knockout blow. It makes them into a state with resources, a coastline, and most of the population. Whereas if you’re (Saudi-allied Yemeni president) Hadi, it knocks you out of the game,” he added.

(Reporting by Jonathan Landay in Washington and Aziz El Yaakoubi in Dubai, Additional reporting by Mohammed Ghobari in Aden; Writing by Ghaida Ghantous, Editing by William Maclean)

Oil jumps almost 4% as output slow to recover from Texas storms

By Laila Kearney

NEW YORK (Reuters) – Oil prices rose nearly 4% on Monday, boosted by the expected slow return of U.S. crude output after last week’s deep freeze in Texas shut in production.

U.S. producers shut anywhere from 2 million to 4 million barrels per day of oil output due to cold weather in Texas and other oil producing states, and the unusually cold conditions may have damaged installations that could keep output offline longer than expected.

Brent crude settled at $65.24 a barrel, rising $2.33, or 3.7%, while U.S. oil settled at $61.49 a barrel, jumping $2.25, or 3.8%. The U.S. benchmark crude contract for March delivery expires on Monday, and the more widely-traded April contract was up $2.44, or 4.1%, at 61.70 a barrel.

Shale oil producers in the region could take at least two weeks to fully restart normal output, sources said, as damage assessments and power disruptions slow their recovery.

“The significant loss of both crude and gasoline production suggests more upside and likelihood of new highs possibly within a one-week time frame,” said Jim Ritterbusch of consultancy Ritterbusch and Associates. But he cautioned that with limited refining capacity, price could under pressure if refiners take weeks to return to normal.

“The market is behaving as if the refiners are going to come online quicker than the headlines would lead you to believe,” said Yawger. Gasoline crackspreads, an indicator of refiners’ margins have dropped by 5%.

For the first time since November, U.S. drilling companies cut the number of oil rigs operating due to the cold and snow enveloping Texas, New Mexico and other energy-producing centers, signaling even tighter supplies ahead.

OPEC+ oil producers are set to meet on March 4, with sources saying the group is likely to ease curbs on supply after April given a recovery in prices, although any increase in output will likely be modest given lingering uncertainty over the pandemic.

“Saudi Arabia is eager to pursue yet higher prices in order to cover its social break-even expenses at around $80 a barrel while Russia is strongly focused on unwinding current cuts and getting back to normal production,” said SEB chief commodity analyst Bjarne Schieldrop.

(Additional reporting by Noah Browning and Aaron Sheldrick in London and Jessica Resnick-Ault in New York; Editing by Jason Neely and Emelia Sithole-Matarise, David Gregorio and Jane Merriman)

Yemen famine could threaten opportunity for peace, U.N. warns

By Michelle Nichols

NEW YORK (Reuters) – A massive famine could wipe out a new opportunity, created by renewed U.S. engagement, to end the war in Yemen, top U.N. officials told the Security Council on Thursday.

U.N. Yemen mediator Martin Griffiths also called for a stop to an offensive by the Houthi movement on the government-held city of Marib, warning “the quest for territorial gain by force threatens all of the prospects of the peace process.”

U.S. President Joe Biden has made ending the conflict in Yemen a priority since taking office last month, appointing a special envoy and ending U.S. support for offensive operations by Saudi Arabia in neighboring Yemen.

“International support for ending the conflict is indispensable, and this offers us a new opportunity to reopen space for a negotiated solution,” Griffiths told the 15-member Security Council.

However, U.N. aid chief Mark Lowcock then warned: “There’s an important opportunity right now to help Yemen move towards lasting peace … but that opportunity will disappear, it will be wasted, if Yemen tips into a massive famine.”

The United Nations describes Yemen as the world’s largest humanitarian crisis, with 80% of the people in need of help.

A Saudi-led military coalition intervened in Yemen in 2015, backing government forces fighting the Iran-aligned Houthis. The more than six-year-long conflict is widely seen as a proxy conflict between Saudi Arabia and Iran.

Griffiths visited Tehran this month for the first time since becoming the U.N. envoy three years ago. He made no reference to his visit during his public Security Council statement.

He said the warring parties needed to immediately agree to a nationwide ceasefire, allow the unhindered flow of fuel and other commodities into Hodeidah port and permit international commercial traffic to use Sanaa airport. Griffiths said these issues had been discussed regularly for the past year.

“What is needed is simply and fundamentally the political will to end this conflict. We know need a decision,” he said.

Lowcock said some $4 billion was needed in 2021 to fund humanitarian operations as “Yemen is speeding towards the worst famine the world has seen in decades.” U.N. Secretary-General Antonio Guterres, Switzerland and Sweden plan to convene a pledging conference on March 1 to raise funds for Yemen.

When famine loomed in 2019, Lowcock said it was averted after the United Nations received about 90 percent of the $4 billion it requested. But last year the world body only received about $1.9 billion, about half of what it needed.

Lowcock said some 16 million people in Yemen were going hungry and 5 million of those people are “just one step away from famine.”

Some 400,000 children under the age of 5 are severely malnourished, he said. “Those children are in their last weeks and months,” he warned. “They are starving to death.”

(Reporting by Michelle Nichols; Editing by Chizu Nomiyama and Cynthia Osterman)

Oil jumps 2%, hits highest in year as producers limit supply

By Jessica Resnick-Ault

NEW YORK (Reuters) – Oil prices rose more than 2% on Tuesday, reaching their highest in 12 months after major producers showed they were reining in output roughly in line with their commitments.

The U.S. and global benchmarks rallied as optimism about more U.S. economic stimulus added to market bullishness from supply cuts.

Brent crude was up $1.22, or 2.2%, at $57.57 a barrel by 12:03 EST (1703 GMT) for its third straight day of gains, touching $58.05, the highest levels since January last year.

U.S. oil gained $1.26, or 2.3%, to $54.81, after touching a session high of $55.26, the highest in a year.

The rally began as OPEC production increases were less than expected.

OPEC crude production rose for a seventh month in January but the increase was smaller than expected, a Reuters survey found.

Voluntary cuts of 1 million bpd by OPEC’s de facto leader, Saudi Arabia, are set to be implemented from the beginning of February through March.

Russian output increased in January but is in line with the supply pact, while in Kazakhstan oil volumes fell for the month.

The rally picked up steam as the U.S. Congress looked ready to adopt an economic stimulus package, and as cold U.S. weather boosted heating oil demand.

“You got the U.S. economic stimulus package that no one thought we would get,” said Bob Yawger, director of energy futures at Mizuho in New York.

A cold snap and heavy snow in the U.S. northeast drove the margin for heating oil to an 8-month high of $15.88, lending further support to crude.

However, energy giant BP flagged a difficult start to 2021 amid declining product demand, noting that January retail volumes were down about 20% year on year, compared with a decline of 11% in the fourth quarter.

Oil demand is nevertheless expected to recover in 2021, BP said, with global inventories seen returning to their five-year average by the middle of the year.

(Additional reporting by Noah Browning and Aaron Sheldrick; Editing by David Evans, David Goodman and David Gregorio)

Oil hits 11-month high near $57 on tight supply expectations

By Laura Sanicola

NEW YORK (Reuters) – Oil hit an 11-month high just below $57 a barrel on Tuesday, bolstered by Saudi Arabia’s plans to limit supply, offsetting worries that rising coronavirus cases globally would curtail fuel demand.

Brent crude was up 90 cents, or 1.6%, at $56.56 a barrel by 1118 EST (1618 GMT) after touching its highest since last February at $56.75. U.S. West Texas Intermediate (WTI) gained 82 cents, or 1.6%, to $53.07.

Saudi Arabia plans to cut output by an extra 1 million barrels per day (bpd) in February and March to keep inventories in check.

The Saudi cut is part of an OPEC-led deal in which most producers will hold output steady in February. Last year’s record cuts from OPEC and its allies helped oil recover from historic lows reached in April. Some analysts believe the oil complex is underestimating supply levels.

“Storage at Cushing is only 10.2 million barrels below the all-time record high, so there is no problem with supply here in the U.S., but the complex is responding positively to this chatter about undersupply,” said Bob Yawger, director of energy futures at Mizuho.

Oil also gained on expectations for a drop in U.S. crude stockpiles. Analysts expect crude inventories to fall by 2.7 million barrels for a fifth straight week of declines.

The first of this week’s two supply reports, from the American Petroleum Institute, is due at 4:30 p.m. EST (2130 GMT).

The market is also being supported by the prospect of increased economic stimulus in the United States. President-elect Joe Biden, who takes office on Jan. 20, has promised “trillions” in extra pandemic-relief spending.

However, oil price gains were capped by demand concerns as coronavirus cases rise around the world.

Chinese authorities introduced new curbs in areas surrounding Beijing on Tuesday and Japan is to widen a state of emergency beyond Tokyo.

(Additional reporting by Alex Lawler and Jessica Jaganathan; Editing by Kirsten Donovan, David Goodman and David Gregorio)