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An oil tanker is on fire in the sea of Oman on June 13, 2019. Since Israel has made it clear that its aggression extends to Iran, there is real potential for a serious regional and even global war.
| Photo Credit: AP

The recent escalation of tensions in West Asia has led once again to concerns that this will affect global oil prices, given the region’s importance in global petroleum and natural gas supply. Israel’s horrific devastation of Gaza over the past year and its genocide upon the Palestinian people, and even the attacks on Lebanon did not have much impact on oil markets because neither Palestine nor Lebanon are significant oil producers. But Iran is another matter. Since Israel has now made it clear that its attitude of aggression with impunity covers Iran as well, even to the point of trying to force “regime change” along the lines developed in previous West Asian wars by its fervent supporter the US, there is real potential for the outbreak of a serious regional and even global war.

Also Read | Israel’s diversionary attack on Iran has set off a new security crisis in West Asia

Remarkably, however, international oil markets have not reacted as much as expected. It is true that global oil prices increased in October, rising by 10 per cent in the week to October 7 to an average of above $80 a barrel, but they fell thereafter, staying at around $77 a barrel into the third week of October.

After more than a decade of relative stability in the 1990s and first part of the 2000s, global oil price volatility increased from around the time of the first Gulf War that the US waged against Iraq in 2003, and went up sharply until mid-2007, only to fall drastically in the second half of the year. The figure shows how global oil prices have fluctuated dramatically since then. It is true that current oil prices are much higher in nominal dollar terms than they were two decades ago, but since 2007 they have fluctuated around a constant trend, with sharp peaks and troughs. Also, these have had relatively little to do with geopolitical events and much more to do with economic processes.

Supply-demand dynamics

Essentially, the nature of the global oil market has changed, in terms of both supply and demand. Oil supply is more diversified, to the point where OPEC+ oil producers (the Organization of Petroleum-Exporting Countries, mostly West Asian states like Saudi Arabia, Kuwait, and UAE along with other associated oil-exporting countries like Russia and Kazakhstan) that dominated the market in the 1970s and 1980s are no longer as significant. The US, which has been the largest oil consumer for a long time, became the world’s largest oil producer in 2022 and now accounts for around 22 per cent of global output. This is slightly more than the two next largest producers—Saudi Arabia and Russia—taken together. Meanwhile, despite its significant known oil reserves, Iran provides only 4 per cent of global production, less than China at 5 per cent.

The US is also among the five largest oil exporters (along with Saudi Arabia, Russia, Canada, and Iraq) and is dominant in natural gas exports. Iran is only the 16th largest oil exporter in volume terms, exporting less than 4 per cent of world oil exports. So even the worst-case scenarios currently being considered, such as an Israeli attack on Iran’s oil refineries or a blockade of the Strait of Hormuz through which most of Iran’s oil flows, would have only limited impact on globally traded oil supplies.

Alternative energy sources

The demand side also matters. In the past decade, China emerged as a voracious importer of oil, surpassing the US in 2017. China’s imports of petroleum and its products increased continuously for two decades, peaking in 2023, and were certainly a factor in the oil price increases since 2016, other than the pandemic-period decline. But such oil imports have slowed down and even declined thus far in 2024, reflecting China’s domestic economic slowdown and rebalancing towards other forms of crude energy use (including coal).

As a result, the International Energy Agency (IEA) estimates that world demand is slowing down and will be significantly less this year than in 2023, even as there will be “robust gains” in oil supply from non-OPEC+ countries, led by the United States, Brazil, Guyana and Canada. Meanwhile, the spare capacity to produce oil in OPEC+ countries is at a historic high, lower only than the exceptional period of the COVID-19 pandemic. Further, despite some drawing down of oil inventories over the past four months, global stocks of crude oil and refined products together are the highest of the past few years. As the IEA report says, “For now, supply keeps flowing, and in the absence of a major disruption, the market is faced with a sizeable surplus in the new year.” (https://www.iea.org/reports/oil-market-report-october-2024)

Also Read | Lebanon under siege: Bombed but not broken

Of course, there could still be new shocks coming out of this highly tense and potentially explosive situation, which could dramatically alter these projections that are making global capitalism complacent about likely outcomes. Also, many of the recent spikes in oil prices (just as those in other commodity prices including food) have not resulted from actual supply-demand imbalances, but rather were the result of profiteering by big global corporations in those sectors and financial speculation in energy and commodity markets. These tend to be enabled and then fuelled by media reports rather than real changes in physical markets, and this also could still happen.

But for the moment, the ongoing tragedy and unspeakable horror faced by people in Palestine and Lebanon is not a subject important enough for the markets to take note, because the impact on global energy supplies is still limited.

Jayati Ghosh taught economics at Jawaharlal Nehru University, New Delhi for nearly 35 years, and since January 2021, she has been Professor of Economics at the University of Massachusetts Amherst, US. She has authored and/or edited 20 books and more than 200 scholarly articles.

The Trump campaign filed a formal legal complaint this week with the Federal Election Commission over what the campaign calls “blatant foreign interference in the 2024 Presidential Election in the form of apparent illegal foreign national contributions made by the Labour Party of the United Kingdom, and accepted by Harris for President.” 

That claim remains unsubstantiated, and has been denied by both the U.K. Labour Party and its leader, British Prime Minister Keir Starmer. But lobbying firms and individual lobbyists formally registered as foreign agents of governments around the world — all with varying interests and including some autocratic regimes such as Saudi Arabia, Qatar, and the United Arab Emirates — are donating significant amounts of money to both Republican and Democratic parties and candidates in this election cycle, a CBS News analysis has found.  

It is not uncommon, and not illegal, for registered foreign agents and lobbyists to finance political campaigns. Any legal permanent U.S. resident can donate to a political candidate or campaign, subject to limits imposed by the FEC. 

Over $33.5 million in individual political contributions came from registered foreign agents and lobbyists during the 2020 election cycle, according to analysis conducted by the OpenSecrets organization.

But campaign finance experts say the volume of donations reviewed by CBS News and the way they’re steered into American politics to serve foreign interests highlights potential loopholes in existing U.S. campaign finance laws. CBS News has reached out to all lawmakers, and donors referenced in this report for comment. 

The donations and firms behind them highlighted below are likely to be just the tip of the iceberg in terms of the scale of political contributions being made by registered foreign agents, and experts say it’s not just the flow of money that matters, but the conversations that take place between the entities involved. 

“What I’ve seen in over 15 years of analyzing U.S. Foreign Agents Registration Act [FARA] filings is that there is a very, very strong correlation between whom these foreign agents are contacting and whom they’re giving money to, you know, which campaigns they’re giving money to,” Ben Freeman, the director of the Quincy Institute’s Democratizing Foreign Policy program, told CBS News. 

“If they’re contacting a congressional office, on behalf of a foreign power, there’s a very good chance that they or somebody at their firm are also making campaign contributions to them,” Freeman said. 

Below are some of those firms: 

Brownstein Hyatt Farber Shreck

Brownstein Hyatt Farber Schreck made $17 million in revenue for the third quarter of 2024 alone, according to Politico, citing the firm’s most recent disclosure of revenue, making the company one of the most lucrative lobbyists in Washington.

OpenSecrets’ most recent analysis shows the firm has taken nearly $1.3 million in total fees from foreign governments this year, with its biggest client being Saudi Arabia. 

When donations from individuals related to their firm, including relatives of employees, as well as the firm’s own political action committee, are taken into account, Brownstein has donated a total of $2,369,712 this year to political candidates across the country. 

Around 56% of that money has gone to GOP candidates and causes, while about 42% has gone to groups and candidates affiliated with the Democrats, OpenSecrets data shows.

FARA filings reviewed by CBS News show the company is currently representing both the Saudi Ministry of Foreign Affairs and NEOM company, an investment group controlled by the Saudi government. 

The principal signatory on the firm’s foreign agent filings is Nadeam A. Elshami, a former chief of staff to ex House Speaker Nancy Pelosi. Federal Election Commission records show Elshami has made multiple donations to senior Democratic figures this year. 

Elshami donated $2,500 in July to the Jobs, Education and Family First PAC, a political action committee affiliated with Democratic House Minority Leader Hakeem Jeffries. This PAC is a “Leadership PAC,” which is a fundraising tool often established “in order to support candidates for various federal and nonfederal offices,” according to the FEC. 

Records show Elshami also donated $500 in June to the re-election campaign of Rep. Adam Smith, the top ranking Democrat on the House Armed Services Committee —  the body responsible for funding and oversight of the U.S. Department of Defense and the United States Armed Forces. 

Smith was part of a congressional delegation that met with Saudi Crown Prince Mohammed bin Salman in Jeddah in March of this year. In August, the Biden administration lifted a ban on selling offensive weapons to Saudi Arabia, reversing a three-year-old policy that had been in place to pressure the kingdom to wind down the Yemen war.

Smith told CBS News in a phone interview on Wednesday that he had not even been aware of the donation but said that it was “a bit of a stretch to take someone who is a U.S. citizen with 20 years of Hill experience, dozens of clients and say that he was acting on behalf of Saudi Arabia.” 

“If it’s proven that Saudi Arabia or any other country for that matter is organizing an effort to get people to give money, then that’s bundling and foreign countries can’t do that,” he added. 

Elshami also donated $1,000 to the campaign of Rep. Pete Aguilar, chair of the House Democratic Caucus, responsible for electing Democratic leadership in the House, as well as $5,000 to the Democratic Congressional Campaign Committee, an official fundraising arm for House Democrats across the country. 

“These aren’t the biggest contributions that members of Congress are going to be receiving in terms of donations, but $1,000, $5,000, $10,000, especially in the smaller downstream races, that goes a significant way, especially in the House of Representatives,” Casey Michel, author of the book “Foreign Agents: How American Lobbyists and Lawmakers Threaten Democracy Around the World,” told CBS News. 

Ballard Partners 

Lobbying firm Ballard Partners has received around $375,000 from foreign governments this year. OpenSecrets analysis shows the Democratic Republic of the Congo has been its most lucrative client, but FARA filings show the firm has lobbied for countries including Japan, Liberia and Guatemala. The firm recently opened a new office in Saudi Arabia. 

Republican megadonor Brian Ballard is the chief signatory on these foreign agent filings 

This year alone, Ballard has personally donated around $250,000 to the Republican National Committee, and another $250,000 to the Trump 47 Committee PAC. 

While Ballard has prolifically donated to Republican causes, he did contribute $3,300 to Sen. Chris Coons, of Delaware, in March. The following month, Coons — a top Democrat on the powerful Senate Foreign Relations Committee and a close ally of President Biden’s — introduced a renewal of the African Growth and Opportunity Act, or AGOA. One of Ballard’s clients, the Democratic Republic of Congo, is a beneficiary of this legislation, which grants sub-Saharan African countries duty-free access to the U.S. market.

A spokesperson for Coons told CBS News in a statement that “AGOA has had broad, bipartisan support for nearly 25 years, and Senator Coons is one of many in Congress who have routinely supported AGOA during his tenure in the Senate.”

“Senator Coons believes that Americans should have confidence their legislators are not unduly influenced by foreign nations, and he would consider any FARA reform that came before the Senate,” the spokesperson said. 

Akin Gump Strauss Hauer & Feld LLP

The lobbying group Akin Gump Strauss Hauer & Feld has earned $5.5 million dollars from foreign government clients this year. 

The United Arab Emirates is behind a sizable chunk of those fees, having paid the company $1.9 million dollars for its lobbying services on the Gulf state’s behalf, according to OpenSecrets. The company has also received $1.5 million from Saudi Arabia, OpenSecrets records show. 

Political contributions from individuals and their family members related to the firm, as well as the firm’s own PAC donations, have totalled about $2.7 million for 2024 so far, according to an OpenSecrets analysis. 

The donations have been distributed on a fairly bipartisan basis. Contributions include a total of $121,195 to the Democratic Senatorial Committee and $100,715 to the Kamala Harris campaign, and $100,625 to the National Republican Senatorial Committee.

FARA filings reviewed by CBS News show a current senior advisor for Akin Gump, Ileana Ros-Lehtinen, was lobbying on behalf of the UAE as recently as 2022.

Ros-Lehtinen is a former Florida Republican congresswoman who has made multiple donations to GOP lawmakers in this election cycle. 

In February, Ros-Lehtinen made a $1,000 donation to Republican Rep. Maria Salazar, a member of the House Foreign Affairs Committee, the powerful committee with jurisdiction over bills and investigations concerning U.S. foreign affairs, as well as a $500 donation to Rep. Mario Diaz Balart, a congressman who has in the past taken a hard-line legislative stance against the Muslim Brotherhood, pushing for sanctions against the Sunni Islamist political movement. The group is fiercely opposed by the UAE. 

She also donated $5,000 to Akin Gump’s own political action committee in February. 

“In the U.S., by far, the most common occupation for former members of Congress is to lobby other members of Congress when they leave the House or the Senate — it’s more than 50%,” Ben Freeman of the Quincy Institute notes. 

Freeman told CBS News the cumulative effect of political donations can be sizable in terms of lobbyist influence. 

“Something like $500, you know, it might not look like that much if you look at just one of these contributions at a time, but these contributions don’t happen on an island. One lobbyist at the firm might make a $1,000 contribution, another one might make $2,000. The firm’s PAC might make, you know, several $1,000 contributions, too,” he said. “When you start adding up all the contributions from all the lobbyists and the firm itself, you start to get to some serious numbers on some of these politicians — you know, tens of thousands and even hundreds of thousands.” 

BGR Group

The firm BGR Group has earned $288,621 this year according to OpenSecrets. Most of that money has come from its top client, Qatar. 

Individuals and PACs associated with the lobbying firm have, per OpenSecrets records, spent nearly $2 million cumulatively in campaign contributions in this election cycle.

Of that money, around $29,532 in total contributions from individuals and from the firm itself has been donated specifically to Republican Sen. Roger Wicker, the ranking member of the Senate Armed Services Committee, during 2024. It makes Wicker one of the largest individual beneficiaries of BGR contributions this year, per OpenSecrets analysis. 

The Senate Armed Services Committee is currently reviewing Qatar’s status as a major non-NATO U.S. ally, after a group of senators introduced legislation to revoke the Gulf state’s status unless it withdraws alleged financial support for terrorist groups and expels or extradites senior Hamas leadership.

Wicker voiced opposition to the bill when it was introduced in April. 

“This strikes me as a step we should be very careful about,” Wicker said, according to Jewish Insider. “Qatar has been a friend in many ways and there are mutual benefits in our two countries continuing to be friends. This is a matter that governments should speak to each other about.”

In a statement, Nathan Calvert, communications director for Sen. Wicker, said “support from individuals at BGR is a direct result of long-standing friendships among fellow Mississippians that precede Senator Wicker’s time in elected office. Senator Wicker regularly meets with and considers the views of a wide variety of constituents and stakeholders regardless of their political support or lack thereof.”

FEC filings seen by CBS News also show that BGR Government Affairs CEO Bob Wood has donated more than $42,000 to the National Republican Senatorial Committee, the official fundraising arm for the GOP’s efforts to elect candidates to the U.S. Senate.

Will FARA laws change?

Recent cases involving Democratic lawmakers including former Sen. Robert Menendez of New Jersey, Rep. Henry Cuellar of Texas, and New York City Mayor Eric Adams, have exposed the potential frailties in foreign agent registry laws that could allow for foreign influence campaigns. 

All three lawmakers were indicted in separate cases on charges of accepting bribes from foreign governments in exchange for official acts over the past year. Both Adams and Cuellar have pleaded not guilty to the charges and denied any wrongdoing. In July, Menendez was found guilty on all counts after being tried on charges of illegally using his influence to benefit the governments of Egypt and Qatar. 

Campaign finance expert Casey Michel told CBS News that legislative efforts to reform lobbying rules seem unlikely to pass, as lawmakers are the primary beneficiaries of the existing system.

Michel noted that a whole host of legislative efforts — including a bipartisan bill called the Fighting Foreign Influence Act — have failed in Congress. 

“I think the great irony in the last few years is that there have been all these bills that have been introduced, especially related to FARA and how to tighten things up, how to improve things, and none of them have passed,” Michel said. “And the reason was because the chairman of the Senate Foreign Relations Committee, who was, you know, the most powerful senator in terms of crafting American foreign policy, was Bob Menendez, who, as we now know, was working simultaneously as an agent of the Egyptian government.” 

Joanne Stocker

contributed to this report.

Editor’s Note: A version of this story appears in today’s Meanwhile in the Middle East newsletter, CNN’s three-times-a-week look inside the region’s biggest stories. Sign up here.

Abu Dhabi, UAE
CNN
 — 

It’s a partnership that’s been hailed as “history in the making.”

One of the world’s most famous soccer stars landed in the Saudi capital Riyadh on Tuesday, where Cristiano Ronaldo was received in an extravagant ceremony, with excited children sporting his new club’s yellow and blue jerseys.

Oil-rich Saudi Arabia’s success in luring the five-time Ballon d’Or winner on a two-year contract with the kingdom’s Al Nassr FC is the Gulf monarchy’s latest step in realizing its sporting ambitions – seemingly at any cost.

According to Saudi state-owned media, Ronaldo will earn an estimated $200 million a year with Al Nassr, making him the world’s highest-paid soccer player.

Shortly after the 37-year-old’s signing with Al Nassr, the club’s Instagram page gained over 5.3 million new followers. Its official website was inaccessible after exceeding its bandwidth limit due to the sudden surge in traffic, and the hashtag #HalaRonaldo – Hello, Ronaldo in Arabic – was trending for days across the Middle East on Twitter.

Analysts say that his recruitment in Saudi Arabia is part of a wider effort by the kingdom to diversify its sources of revenue and become a serious player in the international sporting scene.

It is also seen as a move by the kingdom to shore up its image after it was tarnished by the 2018 dismemberment and killing of Washington Post columnist Jamal Khashoggi at the hands of Saudi agents, and a devastating war it started in Yemen in 2015.

Critics have decried the kingdom for “sportswashing,” an attempt to burnish one’s reputation through sport.

“I think Saudi Arabia has recognized a couple of years ago that to be a powerful nation internationally, you cannot just rely on hard power,” Danyel Reiche, a visiting research fellow and associate professor at Georgetown University Qatar, told CNN.

“You also need to invest in soft power, and the case of Qatar shows that this can work pretty well,” he said, adding that Saudi Arabia is following in the Qatari approach with sport, but with a delay of around 25 years.

Neighboring Qatar has also faced immense criticism since it won the bid to hosting last year’s FIFA World Cup in 2010.

Despite the smaller Gulf state facing similar accusations of “sportswashing,” the tournament has largely been viewed as a success, not least in exposing the world to a different view of the Middle East, thanks in part to Morocco’s success in reaching the semifinals and Saudi Arabia beating eventual World Cup champion Argentina in their opening group game.

Gulf nations engage in fierce competition to become the region’s premier entertainment and sporting hubs. The UAE, Saudi Arabia, Qatar and Bahrain, in close proximity to each other, each have their own Formula One racing event. But their competition hasn’t been confined to the region. Qatar, Saudi Arabia and the UAE have also bought trophy European soccer teams.

Riyadh is playing catchup with neighbors who have long realized the importance of investing in sports, said Simon Chadwick, professor of sport and geopolitical economy at SKEMA Business School in Lille, France, especially as its main source of income – oil – is being gradually shunned.

“This is part of an ongoing attempt to create more resilient economies that are more broadly based upon industries other than those that are derived from oil and gas,” Chadwick told CNN.

Ronaldo’s new club Al Nassr is backed by Qiddiya Investment Company (QIC), a subsidiary of the kingdom’s wealth fund, the Public Investment Fund (PIF), which has played a pivotal role in Saudi Arabia’s diversification plans.

“It is also a sign of interconnectedness, of globalization and of opening up to the rest of the world,” said Georgetown University’s Reiche.

The move is part of “several recent high profile moves in the sports world, including hosting the Andy Ruiz Jr. and Anthony Joshua world heavywight boxing championship bout in 2019, and launching the LIV Golf championship,” said Omar Al-Ubaydli, director of research at the Bahrain-based Derasat think tank. “It is a significant piece of a large puzzle that represents their economic restructuring.”

The kingdom has been on a path to not only diversify its economy, but also shift its image amid a barrage of criticism over its human rights record and treatment of women. Saudi Arabia is today hosting everything from desert raves to teaming up with renowned soccer players. Argentina’s Lionel Messi last year signed a lucrative promotional deal with the kingdom.

Hailed as the world’s greatest player, 35-year-old Messi ended this year’s World Cup tournament in Qatar with his team’s win over France, making his ambassadorship of even greater value to the kingdom.

The acquisition of such key global figures will also help combat the monarchy’s decades-long reputation of being “secretive” and “ultra-conservative,” James Dorsey, a senior fellow at the S. Rajaratnam School of International Studies in Singapore and an expert on soccer in the Middle East, told CNN’s Eleni Giokos on Wednesday.

Al-Ubaydli said that the kingdom wants to use high profile international sports “as a vehicle for advertising to the world its openness.”

Saudi Arabia bought the English Premier league club Newcastle United in 2021 through a three-party consortium, with PIF being the largest stakeholder. The move proved controversial, as Amnesty International and other human rights defenders worried it would overshadow the kingdom’s human rights violations.

Ronaldo’s work with Saudi Arabia is already being criticized by rights groups who are urging the soccer player to “draw attention to human rights issues” in Saudi Arabia.

“Saudi Arabia has an image problem,” especially since Khashoggi’s killing, says Reiche. But the kingdom’s recent investments in sports and entertainment are “not about sportswashing but about developing the country, social change and opening up to the world.”

Saudi Arabia is reportedly weighing a 2030 World Cup bid with Egypt and Greece, but the kingdom’s tourism ministry noted in November that it has not yet submitted an official bid. Chadwick believes that Ronaldo’s deal with Al Nassr, however, may help boost the kingdom’s bid should it choose it pursue it.

Another way Saudi Arabia may benefit from Ronaldo’s acquisition is that it will be able to improve commercial performance, says Chadwick, especially if this collaboration attracts further international talent.

“It is important to see Ronaldo not just as a geopolitical instrument,” said Chadwick, “There is still a commercial component to him and to the purpose he is expected to serve in Saudi Arabia.”

What Ronaldo’s move to Saudi Arabia shows is that the kingdom aspires “to be seen as being the best” and that it wants to be perceived as a “contender and a legitimate member of the international football community,” said Chadwick.

UAE FM meets Syria’s Assad in Damascus in further sign of thawing ties

Syrian President Bashar al-Assad received the United Arab Emirates Foreign Minister Sheikh Abdullah bin Zayed in Damascus on Wednesday in the latest sign of thawing relations between Assad and the Gulf state. The meeting addressed developments in Syria and the wider Middle East, according to UAE state news agency WAM.

Turkish President Erdogan says he could meet with Assad

Turkish President Recep Tayyip Erdogan said in a speech on Thursday that he could meet the Syrian leader “to establish peace.”

Iran shuts down French cultural center over Charlie Hebdo’s Khamenei cartoons

Iran announced on Thursday it had ended the activities of a Tehran-based French research institute, in reaction to cartoons mocking Ayatollah Ali Khamenei and fellow Shia Muslim clerics published by French satirical magazine Charlie Hebdo this week.

The prized legacy of iconic Egyptian singer Umm Kulthum re-emerged this year when Rolling Stone magazine featured her in its “200 Greatest Singers of All Time.”

Ranking 61st, Umm Kulthum was the only Arab artist to make it to the list, with the magazine saying that she “has no real equivalent among singers in the West.”

Born in a small village northeast of the Egyptian capital Cairo, Umm Kulthum rose to unmatched fame as she came to represent “the soul of the pan-Arab world,” the music magazine said.

“Her potent contralto, which could blur gender in its lower register, conveyed breathtaking emotional range in complex songs that, across theme and wildly-ornamented variations, could easily last an hour, as she worked crowds like a fiery preacher,” it wrote.

Nicknamed “the lady of Arab singing,” her music featured both classical Arabic poetry as well as colloquial songs still adored by younger generations. Her most famous pieces include “Inta Uumri” (you are my life), “Alf Leila Weileila” (a thousand and one nights), “Amal Hayati” (hope of my life) and “Daret al-Ayyam” (the days have come around). Some of her songs have been remixed to modern beats that have made their way to Middle Eastern nightclubs.

The singer remains an unmatched voice across the Arab World and her music can still be heard in many traditional coffee shops in Old Cairo’s neighborhoods and other parts of the Arab world.

Umm Kulthum’s death in 1975 brought millions of mourners to the streets of Cairo.

By Nadeen Ebrahim