Tillerson to Tour Persian Gulf Capitals as U.S. Seeks to End Qatar Spat

EghtesadOnline: Secretary of State Rex Tillerson will travel to Kuwait, Qatar and Saudi Arabia this week to meet with Persian Gulf leaders as the U.S. seeks to help end a standoff that pits U.S. allies against one another.

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10 July 2017

Tillerson will shuttle between Persian Gulf capitals from Monday to Thursday, U.S. State Department spokesman R.C. Hammond said. The diplomacy is part of a bid by Tillerson to bridge the differences that remain between Qatar and the four-nation Saudi bloc that has isolated it, Hammond said.

Saudi Arabia, the United Arab Emirates, Bahrain and Egypt severed diplomatic and transport links with Qatar, the world’s biggest exporter of liquefied natural gas, on June 5. The alliance accuses Qatar of destabilizing the region by supporting proxies of Shiite-dominant Iran as well as Sunni extremists, charges the sheikdom has denied.

The Gulf flare-up has put the U.S. in a difficult position. It’s allied with nations on both sides of the dispute. Qatar hosts the regional headquarters for the U.S. Central Command, which includes a state-of-the-art air base the Pentagon depends on to target Islamic State. Saudi Arabia has strong counter-terrorism ties with the U.S. and is the top buyer of American weapons.

Ahead of his visit, an American defense official said the U.S. has seen no indication that the crisis will lead to an armed conflict between the nations involved. The official asked not to be identified given the sensitivity of the subject.

The standoff shows no signs of ending. Qatar rejected 13 demands by the Saudi-led alliance to end the crisis, a move the allies say demonstrates its links to terrorist groups. The Saudi-led grouping pledged new political, economic and legal measures against the Gulf nation.

The bloc demanded that Qatar scale back ties with Iran, the Shiite Muslim powerhouse that’s the main rival to Saudi Arabia in the region, sever relations with the Muslim Brotherhood and shut the Al Jazeera media network that’s riled governments throughout the Middle East.

Qatar has enough cash reserves and assets to weather the standoff with inflows into the country still exceeding money heading out, central bank Governor Sheikh Abdullah bin Saoud Al Thani said. Withdrawals from Qatari banks aren’t “significant,’’ the governor said in remarks published by CNBC on its website.

“We have enough cash to preserve any -- any kind of shock,” the governor was quoted as saying. “So we don’t believe that there is anything to worry about at this moment. What I can say is that our environment is proof to anybody that we are first of all solid, strong and resilient against any kind of shocks.”