There are not one, not two, but three ‘weapons’ on the “nuclear option” menu for Saudi Arabia to strike back at any US sanctions stemming from its alleged murder and dismemberment of dissident journalist Jamal Khashoggi in what is now being reported as a “botched interrogation.”
The first is simple and well known – “oil” – cutting off its own supply “nose” to send prices to $100, $200, or $400 may end up spiting its own face however.
So let’s take a look at some other options.
The second, and relatively well known, potential course for retaliation is in its choice of who to buy its weapons from…
President Trump has so far stated his unwillingness to impose any kind of punishment on Saudi Arabia, and as Statista’s Martin Armstrong notes, this could be why – the U.S. is the world’s biggest exporter of arms and according to data from the Stockholm International Peace Research Institute, the biggest importer from the country in 2017 was Saudi Arabia.
You will find more infographics at Statista
This infographic uses the Stockholm International Peace Research Institute’s “trend-indicator values” (TIV). These are based on the known unit production costs of weapons and represent the transfer of military resources rather than the financial value of the transfer.
As Trump himself warned, there are plenty more “sellers” of deadly weapons in the world.
However, there is a third – potentially most existentially challenging option that the Saudis could unleash would be ‘dumping its Treasury Holdings’.
Since the start of 2014, with only one small blip in 2014/15 as oil prices collapsed, the Saudis have been generous buyers of US Treasurys – recycling their petrodollars in this virtuous relationship…
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