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The crisis in Yemen has entered a new phase with the military intervention of Saudi Arabia and its coalition partners. No understanding of developments in the region would be complete without a primer from Dr. Anthony Cordesman, Burke Chair in Strategy at CSIS, to serve as a comprehensive resource for background and context. Here for your consideration is his just released document on the significance of Yemen as Saudi Arabia and its coalition partners enter the second day of military operations dubbed “Operation Decisive Storm.”
America, Saudi Arabia, and the Strategic Importance of Yemen
By Anthony H. Cordesman
March 26, 2015
Yemen is a growing reminder of just how important the strategic U.S. partnership with Saudi Arabia really is. It is one thing to talk about the war against ISIS, and quite another to realize that U.S. strategic interests require a broad level of stability in the Gulf and Arabian Peninsula and one that is dependent on Saudi Arabia as a key strategic partner.
Saudi Arabia has already taken an important lead in Yemen that will need U.S. support. Saudi Arabia and allies are now conducting air strikes in Yemen to try to halt the advance of a Houthi militia, with strong ties to Iran, which is attempting to end President Abd-Rabbu Mansour Hadi’s efforts to relocate Yemen’s elected government to Aden.
Deputy Crown Prince Mohammed bin Nayef, Minister of Interior chaired a meeting of “internal security commanders’ council. (SPA)
Saudi Arabia has formed a coalition of more than 10 countries try to protect the Hadi government. It has also taken the lead in getting the United Arab Emirates (UAE), Bahrain, Kuwait, and Qatar to sign a joint statement supporting Saudi Arabia’s announcement of military action. Moreover, Reuters reports that Egypt, Jordan, and Sudan have said they have forces involved in the operation; that Sudan has pledged ground troops and warplanes; and that Pakistan is considering a Saudi request to send ground forces. Some reports say that Morocco will send combat aircraft as well.
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The United States has already said it would give logistical and intelligence support, but the situation in Yemen may well come to require more than that, and some kind of U.S. combat support as well as U.S. diplomatic pressure on Iran. Once again, the United States is finding out that calling for strategic partnership is not a way of avoiding its role as a world power. One cannot establish partnerships without being a partner.
Saudi Arabia as a Strategic Partner
To put Yemen in a broader strategic context, the crisis in Yemen is only part of the U.S.-Saudi strategic equation. U.S.- Saudi partnership and cooperation is critical in building some form of deterrence and strategic stability to contain Iran in the Gulf.
Any nuclear agreement will not affect the need for close cooperation between the United States, Saudi Arabia and other key members of the Gulf Cooperation Council (GCC) in dealing with the broader and active threat Iran poses in terms of conventional forces, asymmetric warfare, missiles, and strategic influence in Iraq, Syria, Lebanon, and the Gaza Strip.
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Saudi Arabia, the UAE, and Kuwait play a key role in stabilizing Egypt and Jordan, and U.S., Saudi, and UAE cooperation in arms transfers – along with bases and the force of the other Gulf states – are creating military capabilities and interoperability that both reduce the need for future U.S. power projection and greatly enhances the capability of any forces the United States deploys.
At the same time, Yemen is of major strategic importance to the United States, as is the broader stability of Saudi Arabia all of the Arab Gulf states. For all of the talk of U.S. energy “independence,” the reality remains very different. The increase in petroleum and alternative fuels outside the Gulf has not changed its vital strategic importance to the global and U.S. economy.
It has reduced the Gulf’s share of total global petroleum output, but the Middle East still produced 32.2% of the world total in 2013, amounting to 28.358 billion barrels per day (bbl/d). The GCC members (excluding Bahrain) produced 23.9% of the world’s total oil in 2013, amounting to 21.234 billion bbl/d, while Iran’s production amounted to another 4% of the global total, or 3.558 billion bbl/d.
The Broader Strategic Importance of the Gulf and Arabian Peninsula
From a strategic viewpoint, the flow of oil and gas tanker traffic out of the Gulf and through the Strait of Hormuz remains the world’s most important energy chokepoint. The Energy Information Administration (EIA) also reported in November 2014 that an average of 167 million barrels worth of oil a day passed through the Strait of Hormuz, and that:
The Strait of Hormuz is the world’s most important oil chokepoint because of its daily oil flow of 17 million barrels per day in 2013. Flows through the Strait of Hormuz in 2013 were about 30% of all seaborne-traded oil.
EIA estimates that more than 85% of the crude oil that moved through this chokepoint went to Asian markets, based on data from Lloyd’s List Intelligence tanker tracking service.6 Japan, India, South Korea, and China are the largest destinations for oil moving through the Strait of Hormuz.
Qatar exported about 3.7 trillion cubic feet (Tcf) per year of liquefied natural gas (LNG) through the Strait of Hormuz in 2013, according to BP’s Statistical Review of World Energy 2014.7 This volume accounts for more than 30% of global LNG trade. Kuwait imports LNG volumes that travel northward through the Strait of Hormuz.
At its narrowest point, the Strait of Hormuz is 21 miles wide, but the width of the shipping lane in either direction is only two miles wide, separated by a two-mile buffer zone. The Strait of Hormuz is deep and wide enough to handle the world’s largest crude oil tankers, with about two-thirds of oil shipments carried by tankers in excess of 150,000 deadweight tons.
The Strait of Hormuz and Continued U.S. Dependence on the Stable flow of Oil Exports
There are only a limited number of functioning pipelines that provide alternative export routes. They have limited capacity and most are currently operating to their present capacity or under serious military threat. The EIA reported in November 2014 that:
Most potential options to bypass Hormuz are currently not operational. Only Saudi Arabia and the United Arab Emirates (UAE) presently have pipelines able to ship crude oil outside of the Persian Gulf and have additional pipeline capacity to circumvent the Strait of Hormuz. At the end of 2013, the total available unused pipeline capacity from the two countries combined was approximately 4.3 million bbl/d (see Table 2).
Saudi Arabia has the 746-mile Petroline, also known as the East-West Pipeline, which runs across Saudi Arabia from its Abqaiq complex to the Red Sea. The Petroline system consists of two pipelines with a total nameplate (installed) capacity of about 4.8 million bbl/d. The 56-inch pipeline has a nameplate capacity of 3 million bbl/d, and its current throughput is about 2 million bbl/d. The 48-inch pipeline had been operating in recent years as a natural gas pipeline, but Saudi Arabia converted it back to an oil pipeline. The switch increased Saudi Arabia’s spare oil pipeline capacity to bypass the Strait of Hormuz from 1 million bbl/d to 2.8 million bbl/d, but this is only achievable if the system operates at its full nameplate capacity.
Saudi Arabia also operates the Abqaiq-Yanbu natural gas liquids pipeline, which has a capacity of 290,000 bbl/d. However, this pipeline is currently running at capacity and cannot move any additional oil.
The UAE operates the Abu Dhabi Crude Oil Pipeline (1.5 million bbl/d) that runs from Habshan, a collection point for Abu Dhabi’s onshore oil fields, to the port of Fujairah on the Gulf of Oman, allowing crude oil shipments to circumvent the Strait of Hormuz. The pipeline can transport more than half of UAE’s total net oil exports. The government plans to increase this capacity in the near future to 1.8 million bbl/d.
Other pipelines are currently unavailable as bypass options. Saudi Arabia also has two additional pipelines that run parallel to the Petroline system and bypass the Strait of Hormuz, but neither of the pipelines currently has the ability to transport additional volumes of oil if the Strait of Hormuz is closed.
The 1.65 million bbl/d, 48-inch Iraqi Pipeline in Saudi Arabia (IPSA), which runs parallel to the Petroline from pump station #3 (there are 11 pumping stations along the Petroline) to the port of Mu’ajjiz, just south of Yanbu, Saudi Arabia, was built in 1989 to carry 1.65 million bbl/d of crude oil from Iraq to the Red Sea. The pipeline closed indefinitely following the August 1990 Iraqi invasion of Kuwait. In June 2001, Saudi Arabia seized ownership of IPSA and converted it to transport natural gas to power plants. Saudi Arabia has not announced plans to convert the pipeline back to transport crude oil.
Other pipelines, such as the Trans-Arabian Pipeline (TAPLINE) running from Qaisumah in Saudi Arabia to Sidon in Lebanon, or a strategic oil pipeline between Iraq and Turkey, have been out of service for years because of war damage, disuse, or political disagreements. These pipelines would require extensive renovation before they can transport oil. Relatively small quantities, several hundred thousand barrels per day at most, could also be transported by truck if the Strait of Hormuz is closed.
These petroleum exports play a critical role in providing energy to key global economies like China, India, Japan, South Korea, and Taiwan, as well as in limiting the global price of oil, gas, and petroleum products. They also affect the global price of oil and petroleum products in regards of where they come from, and the health of a global economy where every business and job in the United States is steadily becoming more dependent on the flow of imports and exports. Some 15.2 million barrels a day of the 17 million barrels a day of oil flowing out of the Strait of Hormuz go on through the Strait of Malacca to support the economy of key exports to the United States and the other significant amount goes to India.
The United States has sharply reduced its dependence on direct petroleum imports, but the EIA reported in early 2015 that the United States still imported 27% of its petroleum in 2014. Its Annual Energy Outlook still calculated that the United States would remain dependent on imports for some of its liquid fuels – which are critical to the transport sector – through 2040, with a rise in import dependence to 32% towards the end of the period.
These calculations are uncertain and continue to shift over time. What is far more of a constant is that reductions in direct U.S. imports do not affect the steady growth of the overall dependence of the U.S. economy on the health of the global economy and our imports and manufactured goods . Estimates of this dependence differ even within the U.S. government, but the latest CIA reporting available in March 2015 indicated that U.S. imports totaled $2.273 trillion in 2013 – the latest year for which data were available.
These imports equaled 13.6% of a total GDP of $16.72 trillion. Only 8.2% of these imports were petroleum. Some 86.9% were manufactured goods, and at least 35% were from countries like China, Japan, and Korea that are dependent on Gulf oil imports. This indirect U.S. dependence on imports had a net impact on the U.S. economy of at least $690 billion versus $186 billion for crude oil imports.
The Strategic Importance of Yemen
Yemen does not match the strategic importance of the Gulf, but it is still of great strategic importance to the stability of Saudi Arabia and the Arabian Peninsula. For all of the attention to the Houthi and Yemen’s growing civil conflict, Yemen also became the base of Al Qaeda in the Arabian Peninsula (AQAP) after Saudi counterterrorism forces largely drove it out of Saudi Arabia. It remains the most powerful terrorist threat to Saudi Arabia and the other Southern Gulf states, and both the State Department and National Counter Terrorism Center report that it is the most active single extremist movement in planning terrorist attacks against the United States. Any serious rise of ISIS in Yemen can only make this worse.
As the CIA World Factbook makes clear, Yemen also poses a more direct threat to Saudi Arabia, Oman, and the other GCC states. Yemen may be a small country, but it has a population of 26.1 million, with one of the highest population growth rates in the world. Nearly 63% of its population is 24 years of age or younger. It is deeply divided between Sunnis (65%) and Shiites, like the Houthis, (35%). It is incredibly poor, running out of water, crippled by a drug oriented Qat economy, and facing a steady decline in its already limited petroleum exports.
Even before the current civil war, Yemen was a nation with a doubtful future for anyone who emigrated or had a source of income from family working outside the country. Its per capita income was only around $2,500 – ranking only 187th in the world. Its direct unemployment rate was at least 35% — giving it a global ranking of only 188th in the world — and youth direct and disguised unemployment was probably around 50%. Its agriculture sector was so unproductive that the CIA estimate it accounted for over 70% of the jobs, but less than 8% of the GDP. More than 45% of the population was calculated to live below a dismally low national poverty line, while the elite 10% accounted for over 30% of national consumption.
These steadily deteriorating economic realities have dropped to an absolute crisis level because of the current political divisions and fighting, and have created one of the world’s most fertile grounds for political extremism, terrorism, sectarian struggles between Sunni and Shi’ite and even more intense effort to leave the country and find jobs in Saudi Arabia and the Gulf. Saudi Arabia, and to a lesser extent Oman, face the fact that Saudi Arabia has a 1,458 kilometer border with Yemen and Oman has a 288 kilometer border.
Saudi Arabia has faced a major threat from Yemeni illegal immigration, smuggling, and hostile terrorist and political forces for decades. These not only include hundreds of thousands of illegal immigrants from Yemen, but other illegal immigrants and extremists from unstable countries like Somalia, who move into the other Arab Gulf states. Saudi Arabia already had to try to expel them from the Kingdom when Yemen supported Iraq in the Gulf War in 1990 and 1991, and instability in Yemen may well now pose a more immediate threat to Saudi Arabia and the other Arab Gulf petroleum exporting states than the instability in Syria and Iraq.
The Houthi, Iran, and the Bab el Mandab
At the same time, the growing ties between Yemen’s Houthi Shi’ites and Iran poses another threat to both Saudi Arabia and the United States. It potentially could allow Iran to outflank the Gulf, and deploy air and naval forces to Yemen. This threat still seems limited, but it is important to note that Yemen’s territory and islands play a critical role in the security of another global chokepoint at the southeastern end of the Red Sea called the Bab el Mandab or “gate of tears.”
It is critical to note that far more is involved than energy: the cost and security of every cargo that goes through the Suez canal, the security of U.S. and other allied combat ships moving through the canal, the economic stability of Egypt, and the security of Saudi Arabia’s key port at Jeddah and major petroleum export facility outside the Gulf. The EIA describes the energy impact of importance of this chokepoint as follows:
The Bab el-Mandeb Strait is a chokepoint between the Horn of Africa and the Middle East, and it is a strategic link between the Mediterranean Sea and the Indian Ocean. The strait is located between Yemen, Djibouti, and Eritrea, and connects the Red Sea with the Gulf of Aden and the Arabian Sea. Most exports from the Persian Gulf that transit the Suez Canal and SUMED Pipeline also pass through Bab el-Mandeb.
An estimated 3.8 million bbl/d of crude oil and refined petroleum products flowed through this waterway in 2013 toward Europe, the United States, and Asia, an increase from 2.9 million bbl/d in 2009. Oil shipped through the strait decreased by almost one-third in 2009 because of the global economic downturn and the decline in northbound oil shipments to Europe. Northbound oil shipments increased through Bab el-Mandeb Strait in 2013, and more than half of the traffic, about 2.1 million bbl/d, moved northbound to the Suez Canal and SUMED Pipeline.
The Bab el-Mandeb Strait is 18 miles wide at its narrowest point, limiting tanker traffic to two 2-mile-wide channels for inbound and outbound shipments. Closure of the Bab el-Mandeb could keep tankers from the Persian Gulf from reaching the Suez Canal or SUMED Pipeline, diverting them around the southern tip of Africa, adding to transit time and cost. In addition, European and North African southbound oil flows could no longer take the most direct route to Asian markets via the Suez Canal and Bab el-Mandeb.
Any hostile air or sea presence in Yemen could threaten the entire traffic through the Suez Canal, as well as a daily flow of oil and petroleum products that the EIA estimates increased from 2.9 mmb/d in 2009 to 3.8 mmb/d in 2013. Such a threat also can be largely covert or indirect. Libya demonstrated this under Qaddafi when he had a cargo ship drop mines in the Red Sea.
There is still hope for a diplomatic solution, and Saudi Arabia may not have to escalate their military action. Securing the Saudi border and putting pressure on Yemen’s factions may be enough. Americans need to be ready for the fact, however, that the United States cannot call for strategic partners unless it is prepared to be one. They need to understand just how important a threat Yemen can be, just how deep the underlying forces that divide its current factions really are, that terrorism and extremism remains a far greater problem than ISIS, and that Iran’s ambitions to steadily broaden its strategic role throughout the region pose as much of a threat as its nuclear ambitions.
As Afghanistan, Iraq, and Syria all demonstrate, it is easier to declare deadlines and withdrawals. Yemen is one more demonstration that strategy is based on reality and not doctrine.
Anthony H. Cordesman holds the Arleigh A. Burke Chair in Strategy at the Center for Strategic and International Studies (CSIS) in Washington, D.C.
Read more on this topic:
- Amb Al Jubeir Press Conference – Yemen Campaign (Video) – Mar 26, 2015
- For the Record | US Statement on the Situation in Yemen – SUSRIS – March 26, 2015
- Saudi Leaders at Military Command Center in Photos – SUSRIS – March 26, 2015
- Saudis, Partners Act to Recover Yemen From a “Dark Tunnel” – SUSRIS – Mar 25, 2015
- Special Report | Crisis in Yemen – Saudi Arabia Strikes – SUSRIS – Mar 25, 2015
- SUSRIS Special Section – Turmoil in Yemen-2015