The Political and Economic Challenges of Energy in the Middle East and North Africa

David Ramin Jalilvand, Kirsten Westphal

• Publisher: Routledge
• Year: 2017
• eBook ISBN: 9781351783484
• Edition: 1
• Topic: Politics & International Relations
• Subtopic: Politics
• Index: Politics & International Relations

The Middle East and North Africa (MENA) are in disarray, and shifts in the field of energy have the potential to drastically affect the course of political and economic developments in the region. Declining oil prices, skyrocketing domestic demand, the rise of unconventional oil and natural gas production in North America, as well as shifting patterns of global energy trade all put severe pressures on both producing and importing countries in the MENA region. Policy-makers are facing fundamental challenges in light of the duality of grand transformations in (geo)politics and energy. Changes in the field of energy require substantial political and economic reforms, affecting the very fabric of sociopolitical arrangements. At the same time, the MENA region's geopolitical volatility makes any such reforms extremely risky.

Including contributions by academics and analysts from both inside and outside the MENA region, this volume explores the changes in global and regional energy, the impact of changing international energy dynamics on politics and economies in the MENA region, and the challenges that will result.

This is essential reading for researchers, postgraduates, and professionals in Middle Eastern and North African politics, global energy governance and regionalism.

1 Regional trends after the dissolution of “old orders” in the Middle East and North Africa

Guido Steinberg and Isabelle Werenfels

Introduction

The dynamics unleashed by the Arab uprisings in 2011 form the political backdrop to developments in the field of energy in the Middle East and North Africa.¹ Close to six years after the so-called Arab Spring, the Middle East and North Africa looked like a region falling apart. Previous orders and political arrangements, both national and regional, have been challenged not only by political elites, both old and new, but also by armed insurgents. At the same time, dynamics in the region increasingly reveal new cross-regional linkages among state and non-state actors, such as religious solidarities, ideological rifts, and financial interdependences that appear to be more intricate but also more volatile than previous patterns.

In this chapter the authors identify factors and dynamics that shape the newly emerging patterns of regional order. The authors argue that the weakening of states and state failure is the key dynamic around which the main social and political trends and (new) patterns of cooperation – and potentially more lasting orders in the region – crystallize. These trends and patterns include the following. First, the new power of sub-state actors, ranging from civil protest movements and “traditional” (tribal) leaders, to militant groups of differing ideological persuasions. Second, there is an increase of military interventions by neighbors and/or other regional actors seeking to promote their vision of a regional order. Third, and closely related, is the deepening of sectarian and ethnic rifts, which has resulted in new patterns of solidarity and cooperation across the region. Fourth, state failure has contributed to the resurgence of authoritarian orders and the security state in a number of countries. Finally, the return of great powers, namely Russia, to the region, has important implications for patterns of order and cooperation.

State fragility has strongly affected and in some cases even defined the above trends, while some of these trends have in turn further weakened already fragile states. While these mutually reinforcing dynamics have produced anarchy, they have also unleashed new ambitions, patterns of solidarity, and cooperation, and thus point to possible new emerging suborders in the absence of a larger order. While the above trends and dynamics clearly have an important economic dimension and are affected in multiple ways by oil price volatility, the main focus of this chapter will be on the political and social dimensions.

State weakness and state failure

A defining feature of the era that has followed the Arab uprising is the large number of fragile, failing, or failed states in the MENA region. The 2016 Fragile State Index (FSI) labeled only two Arab countries, Oman and Kuwait, as “stable”, and another two, the United Arab Emirates and Qatar, as “more stable”. Meanwhile, no MENA state was classified as “very stable”, “sustainable”, or “very sustainable”.² At the other end of the spectrum, Syria was found in the category of “very high alert”, Iraq of “high alert” and both Egypt and Libya of “alert”. Countries such as Algeria and Morocco, while not in an obvious state of turmoil, were labeled as countries of “elevated warning”. The same is true for Tunisia and Jordan, both bordering the civil war states of Libya and Syria, respectively. Both are bearing the brunt of spillover effects from turmoil in the wider region, including refugee flows, while Tunisia is beset with substantial security and economic challenges due to the presence and return of Jihadi actors from Syria and Libya. The non-Arab states in the region or on its borders did not fare better with regard to stability: Iran was found in the category “high warning”, and both Israel (including Westbank) and Turkey in “elevated warning”. Thus, the key characteristic of regional politics since the uprisings is widespread instability, shaping political developments in the Middle East for years and possibly decades to come.

Prior to 2011, authoritarian states and regimes that appeared stable were the norm. However, under the surface many of the region’s governments and states had become increasingly fragile. Paradoxically, the authoritarian consolidation justified by Arab rulers during the post-9/11 fight against terrorism turned out to be a destabilizing factor, as the ruling elites exploited the situation as an opportunity to repress dissenting actors and legitimize authoritarian rule by presenting Islamist terrorism as the sole alternative to it. This development, in combination with a surge in corruption and a situation in which a small group of elites were the only ones to benefit from liberalization of economies, led to the erosion of regime legitimacy in many states.³ In the republican systems, including Egypt, Tunisia, Syria, and Libya, the failure of the leadership of post-colonial elites and their developmental models became particularly obvious. Efforts by these regimes to substitute political rights with socioeconomic wealth faltered under pressure from growing populations demanding their share of national wealth.

The post-2011 trajectories of Libya, Syria, and Yemen epitomize the cumulative combined effects of the above-mentioned causes of eroding statehood – and the substantial obstacles for (re-)constructing functioning states.

Libya became the first country to plunge into civil war in 2011. Although the war ended in late 2011, the country fractured in the following years, breaking first into two opposing camps in the east and west, and later further dividing into three competing governments. The post-Gaddafi transition collapsed into renewed civil war in 2014. By the middle of the decade Libya had fragmented into innumerable fiefdoms controlled by militias and local (tribal, familial, city) solidarity groups – with few prospects for quick resolution to the conflict, which was in part a resource-inspired, zero-sum power struggle. Moreover, the absence of statehood provided a perfect breeding ground and regional retreat for Jihadi groups, including local affiliates of the Islamic State (IS).⁴

In Yemen, the events of 2011 did not lead directly into civil war. However, efforts to build a new political system after President Ali Abdallah Salih stepped down in February 2012 faltered in the summer of 2014, when Salih and troops loyal to him joined forces with the Huthi rebels. The Huthis are a Zaidi Shi’a movement from northern Yemen that managed to take Sanaa, the capital, in 2014. Together, the unlikely allies (Salih had previously tried to crush the Huthi rebellion since its inception in 2004) ousted the government of Abdrabboh Mansur Hadi, Salih’s successor, which fled first to Aden and then to Saudi Arabia. When the Huthis and Salih threatened to take over Yemen, the United Arab Emirates and Saudi Arabia intervened militarily on behalf of the Hadi government. While the Saudi-led coalition took Aden and advanced northward, the result was a stalemate. The coalition was not strong enough to defeat the Huthis and Salih loyalists in the northern highlands, but the Salih-Huthi forces were unable to advance against the firepower of the Saudi and UAE air forces.

The situation in Syria, where civil war broke out in 2012, was even worse, and Islamist elements of the insurgency quickly gained ground. This was partly due to the lack of external support for the rebels, a consequence of the Obama Administration’s palpable reluctance to engage in another war in the Middle East. As a result, the opposition-in-exile, represented by the Syrian National Council and later by the National Coalition, proved unable to provide fighters with money and weapons. Meanwhile, Islamist, Salafist, and Jihadist financiers supported organizations like the Salafist Ahrar al-Sham (The Free Men of Syria), which became the strongest insurgent group in 2013, along with the al-Qaedaallied Nusra-Front, and other groups, turning the conflict into an increasingly sectarian struggle. This trend was reinforced by the April 2013 appearance of the Islamic State in Iraq and Syria (ISIS), which subsequently conquered large parts of Iraq and Syria. Just when the regime of Bashar al-Assad seemed on the verge of collapse following a string of military defeats in spring 2015, the dictator was saved by the Russian intervention and increasing support from Iran and its Shia proxy forces from Lebanon and Iraq.

Militant sub-state actors profiting from state weakness

While rulers in the Middle East and North Africa struggled to control their populations, some states’ increasing inability to provide order and services in combination with severe repression ultimately strengthened numerous sub-state actors. The spectrum of players competing to fill the vacuum left by failing states ranged from civil society activists to local notables and tribal leaders to armed insurgents. The players that have profited most in fragile and failed states like Tunisia, Egypt, and Iraq are militant groups, including Sunni jihadists connected to al-Qaeda and IS, Shiite militias linked to Iran, and other militant groups fighting in the region’s proliferating conflicts.

This abundance of armed groups not only endangers the remnants of the current order(s); it makes future stabilization of the civil war countries highly unlikely and threatens the remaining stable countries in the region. Furthermore, increasing conflict between Sunni jihadist groups (i.e., al-Qaeda against IS) and with their Shiite enemies has further increased already high levels of violence in the MENA region.

The Islamic State (IS)

The organization that profited most from the repercussions of the Arab Spring is likely IS, which emerged from the remnants of the Iraqi al-Qaeda (al-Qaeda in Mesopotamia) following the American withdrawal. IS profited from the Iraqi government’s policy to marginalize Sunnis and secularists in the country’s political system and the civil war in neighboring Syria, which provided it with strategic depth and thousands of foreign fighters, many of whom left other jihadist organizations following the emergence of IS. The group’s success in mobilizing young recruits worldwide is largely due to its promises to make the Salafi utopia of an Islamic state modeled after the early state of the Prophet and his companions come true. IS created a quasi-state in 2014 after conquering large parts of eastern Syria and northern and northwestern Iraq, and the group consequently constructed an affiliate network spreading to Libya, Egypt, Yemen, and other countries outside the region. By broadening the front, IS hoped to ease pressure on its core territory in Iraq and Syria, where the United States and allies (including the Iraqi government) began a campaign to destroy the IS “caliphate” in the fall of 2014.

al-Qaeda

al-Qaeda managed to remain relevant to regional politics in spite of the loss of recruits to IS, with whom it competed for leadership in the jihadist movement. In 2011, it seemed that al-Qaeda had lost all political relevance, as it played no part in the revolutions of the Arab world. However, when the revolts turned into insurgencies and civil wars, groups allied to al-Qaeda began to reassert their presence, despite the losses to IS. The main source of al-Qaeda’s continuing strength has been its ability to build alliances and integrate itself into larger insurgencies. This became especially obvious in Syria, where the local al-Nusra-Front became one of the strongest insurgent groups in 2012 and survived the loss of many fighters and sources of funding to IS in 2013. In contrast to IS – which demanded unconditional surrender to its leadership – the al-Nusra-Front (which later changed its name to Jabhat Fath al-Sham) built a strong alliance with Salafist groups like Ahrar al-Sham and others, and even cooperated with ideological adversaries like the Free Syrian Army. For the al-Nusra-Front, success in the struggle against the Assad regime was paramount, and it became increasingly obvious in late 2016 that this pragmatic strategy might be more successful in the long run than IS’s attempt to combat all enemies of “true” Islam at the same time.

Shia militias

In contrast to al-Qaeda, which tried to focus on attacks against the United States, IS saw Shiites as a priority target and, since 2003, have tried to provoke the Shiite majority in Iraq into a sectarian civil war. Following the emergence of IS affiliates, from 2014 on these groups attacked Shiite targets in Yemen, Saudi Arabia, Lebanon, Afghanistan, and Pakistan. These assaults galvanized an existing trend toward the establishment of Shia militia that claimed to fight Sunni jihadists, but often attacked Sunni civilians. This was most obvious in Iraq, where an umbrella organization named “Popular Mobilization” (al-Hashd al-Sha’bi) was formed in June 2014 to assist the Iraqi army in fighting IS. The alliance was dominated by militias dependent on Iranian support, like the Badr organization (Munazzamat Badr), the Hizbullah Battalions (Kata’ib Hizbullah), and the League of the Righteous (Asa’ib Ahl al-Haqq), some of which had fought the Americans in Iraq. They became an important force in Iraq and also appeared on the Syrian battlefields, where the Lebanese Hizbullah, Iranian Revolutionary Guards, and militias from Iraq, Afghanistan, and Pakistan supported the Assad regime.

Military interventions by neighbors and fluid new alliances

Meddling by elements of the Iranian security apparatus in the Syrian conflict is just one example of the growing military involvement of North African or Middle Eastern governments in their direct or even peripheral neighborhood. While military interventions in neighboring states by Middle Eastern armies have been a feature of the post-colonial era (Egypt in Yemen in the 1960s, the Iraq–Iran war in 1980–1988, Syrian intervention in the Lebanese civil war from 1976–1990, the Iraqi occupation of Kuwait in 1990), wars between Arab nations and Israel, a perceived outsider in regional politics, were much more common. The number of interventions has risen substantially since 2011, highlighting Middle Eastern governments’ perceived need to mitigate the ...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright page
• Table of Contents
• List of figures
• List of tables
• Notes on contributors
• Acknowledgments
• Introduction
• 1 Regional trends after the dissolution of “old orders” in the Middle East and North Africa
• 2 The price war, OPEC, and the future of the MENA region
• 3 Global gas and LNG markets: the role for MENA countries
• 4 Renewable energy: a recent but dynamic trend in the MENA region
• 5 The energy–climate–water nexus in the MENA region and the need for an integrated approach
• 6 Oil and resilience: changing energy dynamics and the smaller Gulf States
• 7 Iranian energy between nuclear deal, oil price decline, and the new US administration
• 8 Struggling with low oil prices: from bad to worse in crisis-torn Iraq?
• 9 In dire need of a new social contract: Saudi Arabia’s socioeconomic and political challenges
• 10 The Eastern Mediterranean: an energy region in the making
• 11 Cyprus: energy hopes and political troubles
• 12 The impact of natural gas discoveries upon Israeli politics, geopolitics, and socioeconomic discourse
• 13 Jordan: overcoming energy insecurity
• 14 Turkey: in between global trends and regional politics
• 15 Energy politics in Egypt: a quick fix for economic problems?
• 16 Algeria: global challenges, regional threats, and missed opportunities
• 17 Energy security, sustainability, and development in Morocco
• 18 The energy–security nexus in MENA region: appraising the role of the USA, the EU, Russia, and China
• Conclusions and outlook
• Index