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Venu Srivastava asked: What is the US interest in the Middle East even though it possesses more oil (shale gas) reserves?

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  • Adil Rasheed replies: Although the US has recently become the largest oil and natural gas producing country in the world, the OPEC states still produce about 40 per cent of the world’s crude oil with Middle East (or West Asian) states producing about a third of the global output. The global oil market is seamless and any disruption in supplies by one supplier impacts global oil prices simultaneously. As the adage goes, “We all sip from the same cup”. Therefore, the US has to maintain its military presence and influence in the region to avert any geopolitical risks to global oil supplies.

    Besides, the US still depends on OPEC oil for its dollar to remain the world’s reserve currency. The Bretton Woods agreement of 1944 had made the US dollar the world reserve currency and a substitute for gold. However, in 1973, President Richard Nixon declared that his country would no longer exchange gold for US dollars. This so-called ‘Nixon shock’ brought down the Bretton Woods order and ushered in the present system of free-floating fiat currencies. That very year, the US also struck a deal with Saudi Arabia which gave rise to the term ‘petrodollar’. Under this deal, the US became the main security provider of the Saudi state, while the latter agreed to price its oil exports solely in US dollars. By 1975, all OPEC nation-states had started trading oil in US dollars, which ensured that most oil-importing countries maintain US dollar reserves to buy oil. To secure the power of this new petrodollar system, the US has since enhanced its military presence in the region.

    Besides, the Middle East straddles three major continents of the world — Asia, Europe and Africa — which no global superpower can ignore. The US military also dominates the world’s oceans and wants to stop Russia (having access only to frigid seas in the north) and upstart China from entering the Indian Ocean through any passageway or land corridor in the wider Middle East. In addition, the Middle East coastline bears some of the most vital sea lanes of communication. The US provides protection to these vital arteries of global trade and commerce such as the Suez Canal and the Gulf of Hormuz.

    The growing influence of Christian Evangelicals in American politics, who are arguably more influential supporters of Israel than any ‘Jewish lobby’ constitutes up to a fifth of the American electorate today. This growing rightwing constituency wants the US leadership to play a more active role in the Biblical lands of the Middle East, compared to other regions of the world.

    Then there is the additional fear of the US leaving the region prematurely to the mercy of jihadist groups like the ISIS, who could quickly regain their recently lost territories. Again, there is a growing threat from revisionist states like a neo-Sassanid Iran extending its ‘land corridor’ closer to the Mediterranean or neo-Ottoman Turkey trying to re-establish a new Caliphate spreading from the Balkans deep into the Arabian heartland. These are some of the factors that would keep the US interested in the Middle East for the foreseeable future.

    Posted on April 15, 2021

    Views expressed are of the expert and do not necessarily reflect the views of the Manohar Parrikar IDSA or the Government of India.