Like the rest of the Arab world, the six countries of the Gulf Cooperation Council—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE)—have responded to the Russian invasion of Ukraine according to their interests and preferences. While the fighting in Ukraine does not involve them or present a direct threat to regional stability, there are numerous secondary impacts that do have the potential to be consequential for these states’ interests. They include disruption to energy markets, economic dislocation caused by international sanctions on Russia, and new points of tension in (some) political relationships with the Biden Administration. Importantly, there is renewed focus on the balancing act between historically solid political and security integration into the American network of partnerships in the Middle East and the rapid growth of economic, energy, and investment connections with states such as Russia and China.
Officials throughout the Arab Gulf have expressed support for a diplomatic solution that ends the war which began when Russian forces invaded Ukraine on February 24. This in part reflects a reluctance to get drawn into the conflict to the degree where leaders may face pressure to take sides, although this may become more difficult the longer the war continues and fault-lines between the west and Russia widen. Beneath this veneer of consensus lies a spectrum along which Kuwait and Qatar have taken positions that more closely align with Ukraine, Saudi Arabia and the UAE have adopted stances that more cautiously align with Russia, and Bahrain and Oman have largely sought to maintain a low profile. Kuwaiti and Qatari memories of being invaded or threatened by larger neighbors remain vivid while Saudi and Emirati leaders have unresolved issues with the Biden White House as well as stronger oil and defense ties with Russia.
Range of Regional Responses
Russia invaded Ukraine 31 years to the day after the start of the four-day ground offensive that liberated Kuwait in February 1991. The sight of Russian forces massing on the border with Ukraine and Russian President Vladimir Putin issuing increasingly aggressive threats against the Ukrainian leadership undoubtedly awakened memories of Saddam Hussein’s behavior in the months leading up to the Iraqi invasion of Kuwait in August 1990. This Kuwaiti direct experience of invasion and occupation naturally resulted in a Ministry of Foreign Affairs statement on February 24 that went farthest (among Gulf responses) in categorically rejecting the “use, threat to use or displaying of force” in settling international disputes. Kuwait was also the only Arab state among the 80 co-sponsors of the United Nations Security Council resolution on February 25 that upheld respect for the UN Charter, reaffirmed Ukrainian sovereignty, and rejected the use of force.
Qatar has even more recent experience of pressure from larger neighboring states, although the June 2017 blockade imposed by Saudi Arabia and the UAE (as well as Bahrain and Egypt) did not escalate into military action as initially feared by some. Qatari officials responded to the shock of then-president Donald Trump’s initial decision to support the Saudi and Emirati effort to isolate Doha by investing heavily in strengthening all aspects of the bilateral relationship with Washington. These efforts continued into the Biden Administration and eventually led to Qatar’s designation on January 31 a Major Non-NATO Ally of the United States, six weeks after its Emir Tamim bin Hamad Al Thani became the first Gulf leader to visit the Biden White House.
Sheikh Tamim was one of the first foreign leaders to speak with Ukrainian President Volodymyr Zelenskyy in the hours after the Russian invasion on February 24.
Sheikh Tamim was one of the first foreign leaders to speak with Ukrainian President Volodymyr Zelenskyy in the hours after the Russian invasion on February 24 and Qatari Foreign Minister Mohammed bin Abdulrahman Al Thani was in contact with both his Ukrainian and Russian counterparts. During his call with President Zelenskyy, Sheikh Tamim called for dialogue and diplomacy to resolve the issue and prevent further escalation, and subsequently spoke to Zelenskyy again on March 2 and March 9. Foreign Minister Al Thani used a visit to Moscow on March 14 to discuss the Iran nuclear talks with Russian Foreign Minister Sergey Lavrov amid concern that the deterioration in Russia-US relations could undermine the long-running negotiations in Vienna just as a deal seemed to be in sight.
The de facto leaders of the UAE and Saudi Arabia, Abu Dhabi Crown Prince Mohammed bin Zayed and Crown Prince Mohammed bin Salman in Riyadh, both reportedly declined to speak with President Biden as international oil prices (and domestic gasoline prices in the US) surged. Relations between them and the Biden Administration have soured even though Biden has not followed through on his campaign statement that he would make Saudi Arabia a ‘pariah’ and in fact reaffirmed the US commitment to Saudi security in a call with King Salman on February 9. Saudi officials resisted American pressure to ramp up oil production and stuck instead to an OPEC+ agreement struck in July 2021 to incrementally raise production to pre-pandemic levels. OPEC+ is dominated by Saudi Arabia and Russia, and after Mohammed bin Salman spoke by telephone to French President Emmanuel Macron on February 27, an anonymous ‘senior Saudi official’ told The Wall Street Journal that “Saudi Arabia does not see any need to take an action and jeopardize this alliance.”
In contrast to their seeming refusal to speak with Joe Biden, both Mohammed bin Zayed and Mohammed bin Salman held conversations with Vladimir Putin on March 1 and March 3, respectively. The sight of the de facto leaders of two of the highest-profile US partners in the Middle East engaging with Putin while shunning Biden may not be forgotten quickly in Washington. Each of the crown princes has his own problems stemming from their proximity to former US President Donald Trump and members of his inner circle, congressional pushback against the war in Yemen, and, in Mohammed bin Salman’s case, the killing of Saudi columnist Jamal Khashoggi in 2018. The Emirati Ambassador to the United States, Yousef Al Otaiba, noted some of these deeper tensions in remarks made in Abu Dhabi on March 3 when he declared that “Today we are going through a stress test but I’m confident that we will get out of it and get to a better place.”
For the UAE, the balancing act is complicated by the fact that the country began a two-year stint as the Arab representative on the UN Security Council on January 1, 2022. The UAE lobbied hard to win the seat, consistent with its projection of international soft power and influence, but its election has placed Emirati officials in a position where they must take decisions that other Gulf States can avoid. The UAE’s abstaining on two Security Council votes on February 25 and 27 (condemning the invasion and calling an emergency session of the United Nations General Assembly) helped expose the small state to criticism. Although the UAE later joined the other five Gulf States in voting in favor of a General Assembly resolution denouncing the invasion, its Security Council abstentions caused considerable friction with US officials, especially as it appeared that it had sought Russian support for a hardline resolution (which was watered down by other council members) of its own that extended an arms embargo on the Houthi movement in Yemen.
The UAE’s abstaining on two Security Council votes on February 25 and 27 (condemning the invasion and calling an emergency session of the United Nations General Assembly) helped expose the small state to criticism.
Omani and Bahraini leaders have been less involved, although their responses mirrored their respective approaches to regional geopolitics as Sultan Haitham bin Tariq Al Said of Oman called for a diplomatic resolution while King Hamad bin Isa Al Khalifa of Bahrain joined his Saudi and Emirati counterparts in speaking to President Putin. Omani diplomacy has remained focused on issues of regional concern, as evidenced in the successful facilitation of British-Iranian negotiations to secure the March 16 release of two British citizens imprisoned for years in Iran. For both Bahrain and Oman, the surge in oil prices occasioned by the buildup of tensions along the Russia-Ukraine border and the subsequent military invasion have also provided some relief from fiscal pressures arising from years of budget deficits in each state.
Second-order Consequences
Multiple factors lay behind the rise in international oil prices throughout 2021 and early 2022, including economic recoveries from the coronavirus pandemic, OPEC+ caution in moving incrementally to restore pre-2020 production levels, and heightened volatility in patterns of market trading. Prices surged again after Russia invaded Ukraine, broke the $100 per barrel barrier on March 1, and reached a high of $139 per barrel on March 7 before falling back to the $100 range which is still extremely high by historical standards. High oil and commodity prices have contributed to growing inflationary pressure around the world and prompted the United States to raise interest rates on March 16 for the first time since 2018. Central Banks in the Gulf followed suit, given their currency pegs to the dollar (with the partial exception of Kuwait). Gulf policymakers will remain mindful of the previous spike in oil and commodity prices in 2008 which produced an average inflation rate of 11 percent across the GCC and a 15 percent surge in food prices.
The spike in oil, commodity, and food prices are reminders that the Gulf States are not unaffected by the war in Ukraine, although the impacts on Gulf economies and societies will have a second-order effect. To be sure, higher oil prices, which were trending upward long before the war began, will replenish state treasuries and enable governments to achieve long-sought fiscal balance programs. Any sustained rise in oil prices (and government revenues) may also give ruling elites a windfall before longer-term trajectories associated with global energy transitions begin to bite. Any breathing space from rulers’ perspectives may however be offset by rises in subsidy costs to cover higher food and energy prices and by the deleterious impact of inflationary pressures on the millions of low-paid migrant workers across all six GCC states.
There are, nevertheless, several trend-lines that could become more difficult for Gulf governments to reconcile the longer the war continues and if strategic rivalries and great power competition become even more deeply polarized. Many of the Gulf-based sovereign wealth funds have significant exposure to investments in Russia, often in partnership with the Russian Direct Investment Fund, and have already suffered significant drops in their value as Russia has been targeted by Western economic sanctions and has imposed countermeasures of its own. One estimate of the value of Russian assets held by the Qatar Investment Authority (QIA), for example, projected that they had fallen from $16 billion to $9.6 billion in the first two months of 2022, a period which mostly encompassed the buildup of tension rather than the war itself.
Many of the Gulf-based sovereign wealth funds have significant exposure to investments in Russia, often in partnership with the Russian Direct Investment Fund, and have already suffered significant drops in their value.
The QIA owns nearly 19 percent of Rosneft, the Russian integrated energy company, and became the latter’s second-largest shareholder (after the Russian state, which owns 50 percent) following BP’s announcement that it would exit its 19.75 percent stake in Rosneft three days after Russia invaded Ukraine. The decision of the QIA and other Gulf funds, such as Mubadala in Abu Dhabi, not to follow BP and other companies, such as Norway’s Equinor, in withdrawing from Russian investments, indicates that commonalities of interests in energy markets will continue to be a point of connection between the Gulf States and Russia. The leaders of Saudi Arabia and the UAE have made it clear to American officials that they see value in the OPEC+ oil arrangement with Russia while Qatari officials engage with their Russian counterparts through the Gas Exporting Countries’ Forum, which held its summit in Doha two days before the invasion of Ukraine.
Perhaps the trend-line of most significance is the growing divergence between the Saudi and Emirati leaders, on the one hand, and the Biden Administration, on the other. Positions taken over Russia and Ukraine illustrate how tensions that have built up over a period of years have become far more open and difficult to manage on both sides. If one aspect of Saudi and Emirati foreign policy in recent years has been to diversify relationships in response to uncertainty about American staying power in the region, their reluctance to back the United States in a world of greater strategic rivalries is likely to lead to further estrangement politically and undermine US domestic support for continuing defense and security partnerships with Riyadh and Abu Dhabi. It is, after all, only two months since US forces at Al-Dhafra Air Base in Abu Dhabi came under fire from missiles launched by Houthi rebels in Yemen only to see Mohammed bin Zayed snub the visiting commander of CENTCOM by refusing to meet with him in the aftermath of the attack.
A New Pivot?
It may be premature to speak of a post-American Gulf in the networks and structure of US force posture in the region (and it is a matter of some irony that the pivot to Asia that so raised Emirati and Saudi apprehensions of US disengagement referred to a pivot not from the Gulf but from Europe). Still, however, it could be the case that the Russian invasion of Ukraine has accelerated the process of geopolitical drift between American interests and those of its partners in the Gulf, or some of them. In 2019, Emirati and Saudi leaders were shocked after then-president Donald Trump chose not to respond to Iranian-attributed attacks on maritime and energy targets in both countries and drew a distinction between their interests and those of the United States. Those attacks reinforced the desire of leaders in both countries to broaden their range of political and strategic partnerships, including, in the Emirati case, with Israel, and their refusal to pick sides between Russia (or, hypothetically, China) and the United States may be a logical extension of that trend, seen at least from Riyadh and Abu Dhabi. How any such pivot is viewed in Washington, DC is another matter altogether.
