Virtually nobody saw it coming.
Late on Sunday night, the Saudi-led alliance of Gulf Arab states, Saudi Arabia, the UAE and Bahrain including Egypt, shocked the world when they announced they had severed ties and closed borders with one of the Gulf’s wealthiest, if smallest, neighbors Qatar, a (now former) member of the Gulf Cooperation Council in what we called a “geopolitical earthquake” and what Bloomberg dubbed “an unprecedented move designed to punish one of the region’s financial superpowers for its ties with Iran and Islamist groups in the region.”
As we noted first last night, just days after president Trump left the region, a “geopolitical earthquake” took place in the Middle East as the rift between Qatar and other members of the Gulf Cooperation Council exploded with Bahrain, UAE, Saudi Arabia, and Egypt cutting all diplomatic ties with Qatar accusing it of “spreading chaos,” by funding terrorism and supporting Iran. Saudi Arabia, Bahrain, the United Arab Emirates and Egypt all said they will suspend air and sea travel to and from the Gulf emirate. Saudi Arabia will also shut land crossings with its neighbor, potentially depriving the emirate of imports through its only land border.
It was not immediately clear when the proposed measures would be implemented. Saudi Arabia said it would “begin immediate legal measures with friendly, sisterly countries and international companies to implement that measure as quickly as possible for all types of transit from and to the state of Qatar.”
Saudi Arabia cited Qatar’s support of “terrorist groups aiming to destabilize the region,” including the Muslim Brotherhood, Islamic State and al-Qaeda. It accused Qatar of supporting “Iranian-backed terrorist groups” operating in the kingdom’s eastern province as well as Bahrain. Saudi Arabia, along with Bahrain and the U.A.E., gave Qatari diplomats 48 hours to leave.
Qatar responded by saying it regrets the “unjustified” decision of the gulf nations to sever ties and called the accusations “baseless”, saying they were part of a plan to “impose guardianship on the state, which in itself is a violation of sovereignty.”
The first hints that not all is well emerged just three days after Trump left Riyadh as part of his first international trip in May – during which the US president and Saudi King Salman singled out Iran as the world’s main sponsor of terrorism – when the state-run Qatar News Agency carried comments by Qatari ruler Sheikh Tamim bin Hamad Al Thani criticizing mounting anti-Iran sentiment. Officials quickly deleted the comments, blamed them on hackers and appealed for calm, however it was too late and Saudi and U.A.E. media outlets then launched verbal assaults against Qatar, which intensified after Sheikh Tamim’s phone call with Iranian President Hassan Rouhani over the weekend in apparent defiance of Saudi criticism.
“Qatar is right in the middle of the GCC countries and it has tried to pursue an independent foreign policy,” said Peter Sluglett, director of the Middle East Institute of the National University of Singapore quoted by Bloomberg. “The idea is to bring Qatar to heel.”
Qatar’s geopolitical importance can not be underscored, not only for its vast wealth, but because Qatar is one of the biggest producer of liquefied natural gas (and arguably the source of the 6 year long Syrian proxy war, due to Qatar’s documented desires to pass a natgas pipeline into Europe through Syria), and also hosts the forward headquarters of CENTCOM, the U.S. military’s central command in the Middle East.
And speaking of Qatar’s wealth, while the country has a population smaller than Houston, it has one of the world’s largest sovereign wealth funds with over $335 billion investments in companies from Volkswagen, to Rosneft, Barclays, Credit Suisse and Tiffany’s.
What prompted the surprising move by the Gulf-states?
According to some, emboldened by “warmer” ties with the US under President Trump, the Saudi-led alliance is seeking to stamp out any opposition to forming a united front against Shiite-ruled Iran. And while Monday’s escalation is unlikely to hurt energy exports from the Gulf, it threatens to have far-reaching effects on Qatar according to Bloomberg.
Full article: It’s A “Geopolitical Earthquake”: A Stunned World Responds After Saudi Alliance Cuts All Ties With Qatar (ZeroHedge)