(Reuters) – The rise of the Muslim Brotherhood and its ideological affiliates in the Arab Spring uprisings has stoked fears among Gulf Arab governments that the United States may one day abandon its traditional allies as it warms up to Islamists.
While the ruling families in the Gulf are currently vital U.S. allies who buy large amounts of American military hardware and facilitate a significant U.S. military presence, some are apprehensive Washington may apply pressure on them to accommodate Islamists who could end up challenging their exclusive rule.
In a number of colorful online outbursts, Dubai’s outspoken police chief Dhahi Khalfan has warned of an “international plot” to overthrow Gulf systems of government with Western complicity. The Brotherhood, manipulated by the United States, is working to take over the Gulf by 2016, he said.
“Today the Americans are mobilizing the Muslim Brotherhood in the Arab nation, for the benefit of America, not the Arabs,” he wrote on his Twitter account on Sunday. “There is an American plan that has been drawn up for the region.”
Though Khalfan insists his tweets are his personal views, analysts and diplomats say they reflect largely unspoken concerns among the United Arab Emirates’ ruling elite about the regional popularity of the Islamists and the possibility that the West will sympathize with them as political underdogs.
They also reflect fears among the region’s Sunni Muslim rulers that, despite being Sunni itself, the Brotherhood is soft on their arch enemy Shi’ite Iran. Egypt’s Islamist President Mohammed Mursi tried to dissipate such fears at a Tehran conference last week by condemning Iran’s ally Syria and urging attendees to back rebels trying to overthrow President Bashar al-Assad.
Despite pockets of Western-style liberalism in cities like Dubai, most Gulf ruling elites seek to project an image of Islamic conservatism.
So the threat they see is not religious or social but political: the Brotherhood advocates playing by the rules of parliamentary politics as a path to government, threatening inherited rights to rule and state-backed clerical establishments.
An opposition movement that gains ground in Gulf states could perhaps find the U.S. administration newly disposed to speak out in its favor.
Such an opposition has already emerged in the UAE, where more than 50 Islamists linked to Brotherhood thinking have been arrested since late last year. So far Washington has kept mum.
“While the U.S. security umbrella protects the UAE against threats from Iran, Washington would be much more reluctant to support a widespread crackdown against a local opposition movement,” said analyst Ayham Kamel of the Eurasia Group.
“This is making the political leadership in the UAE much more nervous about domestic threats,” he said.
The Brotherhood also has potential to draw support from Gulf Arabs who may see their countries’ foreign policies as overly pro-Western and are concerned about the social influence of their large Asian and Western expatriate communities.
SEEKING U.S. REASSURANCE
Washington was initially hesitant to openly support the uprisings that toppled Tunisia’s Zine al-Abidine Ben Ali and Egypt’s Hosni Mubarak, partly because of concerns they could bring Islamists to power.
President Barack Obama’s administration has since overcome its reluctance, and has made extensive efforts to engage Egypt’s Brotherhood over the past year.
Analysts say Washington is simply pursuing realpolitik given the new power centers in the region.
“I don’t think the West is keen on having a bunch of Islamists coming to power in the Gulf anytime soon,” said Michael Stephens, researcher at the Royal United Services Institute based in Doha. “It’s more the case that Washington is working with who they can work with, because Islamists are in power and they have to be dealt with.”
U.S. officials said privately that they addressed the Gulf’s concerns last year after Mubarak fell and that subsequent conversations have not focused on the issue. They declined to go into specifics.
“Gulf governments realize both the United States and Iran will want to have relations with the new regimes,” said Ghanem Nuseibeh, senior analyst with Cornerstone Global. They just needed to be reassured that those regimes’ gain was not their loss, he said.
Diplomats said they were confident that building good ties with the Brotherhood was unlikely to strain the long-term strategic relationship between the U.S. and Gulf states.
“They (the Gulf states) need the Americans to protect them against Iran. Iran is the biggest worry for them in the whole region right now,” one Gulf-based Western diplomat said, asking not to be named due to the sensitivity of the issue.
YES, BUT …
Still, rumblings persist.
Saudi Arabia, which has long seen itself as insulated from political Islam because of its promotion of more conservative Salafi Islam, is feeling less secure these days, said Abdulaziz Alkhamis, a London-based Saudi analyst.
“After the Arab Spring they (the Islamists) are rising again. They start to use Islamist political rhetoric to gain publicity in the Gulf, especially Saudi Arabia,” he said.
Prominent clerics such as Awadh al-Garni and Salman al-Odah, viewed as sympathetic to the Brotherhood, have become more outspoken, cheering Islamist gains in social media.
Brotherhood-linked Islamists are well-established in Kuwait, where parliamentary politics is most advanced in the Gulf. And in Bahrain the government has drawn closer to the Minbar party, another group inspired by the Brotherhood, as it shores itself up against a protest movement dominated by Shi’ite Islamists.
The angst over what the United States plans for the region is at its most public and visceral in Bahrain, whose government Obama has urged to enter dialogue with leading Shi’ite opposition group Wefaq, citing the group by name.
Sunni clerics and commentators in official media regularly raise the fear that Washington, currently at odds with Tehran over its nuclear program, is plotting to create a Wefaq-led government in a regional reordering of power that would open a new page of cozy ties with Iran.
TV presenter Sawsan al-Shaer denounced a “Satanic alliance” between Tehran and Washington in an article in the al-Watan daily last month, claiming Wefaq was a “Trojan horse, used by the U.S. administration and Iranian regime to redraw the region.”
The wild card in the region is Qatar. It has actively promoted the Brotherhood and its affiliates, giving them coverage widely seen as positive on its satellite broadcaster Al Jazeera.
At an early stage in the uprisings Doha stuck its neck out much further than other Gulf states in its support for protests in Egypt and Tunisia, and then rebel movements in Libya and Syria, supporting those among them close the Brotherhood.
Earlier this year the Dubai police chief railed against Sheikh Yousef al-Qaradawi, a popular Brotherhood-linked Egyptian cleric based in Doha who criticized UAE policy towards Islamists on Al Jazeera. Khalfan threatened to arrest the cleric if he ever entered the country.
Alkhamis said opinion in Saudi Arabia was split over whether Qatar’s close links to the Islamists was a smart move to keep a close eye on a rising movement whose historical time has come, or a ruse to sow discord for its neighbor and sometime rival.
“The Qataris say that if we don’t have the Brotherhood (operating) openly then they will go underground and that it’s not against Saudi Arabia, but the Saudis are not happy with this,” Alkhamis said pointing to Qatar-backed Islamist seminars. “Some think the Qataris are not an honest friend, but have an agenda.”
(Additional reporting by Andrew Quinn in Washington and Raissa Kasolowsky in Abu Dhabi; Editing by Sami Aboudi and Sonya Hepinstall)
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Helix Energy Solutions Group, Inc., reported net income of $16.8 million, for the fourth quarter of 2011 compared with a net loss of $49.8 million, for the same period in 2010. Net income for the year ended December 31, 2011 was $129.9 million, compared with a net loss of $127.1 million, for the year ended December 31, 2010.
Owen Kratz, President and Chief Executive Officer of Helix, stated, “when filtering out the impairments, much of which were associated with declining economics on our natural gas properties, Helix booked another strong operational quarter and generated a relatively significant amount of free cash flow.”
Subsea Construction and Robotics revenues decreased in the fourth quarter of 2011 compared to the third quarter of 2011 primarily due to decreased utilization of our mobile pipelay equipment and lower activity levels at our onshore spoolbase facility. Overall our utilization rate for our owned and chartered vessels increased to 91% in the fourth quarter of 2011 from 86% in the third quarter of 2011. ROV and trenching utilization increased to 69% in the fourth quarter of 2011 compared to 67% in the third quarter of 2011.
Well Intervention revenues decreased in the fourth quarter of 2011 due primarily to lower day rate work performed in the North Sea coupled with the mobilization of the Well Enhancer to West Africa. Vessel utilization in the North Sea decreased to 96% in the fourth quarter of 2011 from 98% in the third quarter of 2011. Vessel utilization in the Gulf of Mexico (Q4000) was 100% in the fourth quarter of 2011. On a combined basis, vessel utilization decreased slightly to 98% in the fourth quarter of 2011 compared to 99% in the third quarter of 2011.
Oil and Gas revenues increased in the fourth quarter of 2011 compared to the third quarter of 2011 due primarily to slightly higher oil and gas production and higher oil prices. Production in the fourth quarter of 2011 totaled 2.24 MMboe compared to 1.95 MMboe in the third quarter of 2011.
The average price realized for oil, including the effects of settled oil hedge contracts, totaled $110.75 per barrel in the fourth quarter of 2011 compared to $100.93 per barrel in the third quarter of 2011. For natural gas and natural gas liquids, including the effect of settled natural gas hedge contracts, we realized $6.16 per thousand cubic feet of gas (Mcf) in the fourth quarter of 2011 compared to $6.15 per Mcf in the third quarter of 2011.
Oil and gas production has averaged approximately 24 thousand barrels of oil equivalent per day (Mboe/d) year-to-date through February 21, 2012, compared to an average of 24 Mboe/d in the fourth quarter of 2011.
Helix Energy Solutions Group, headquartered in Houston, Texas, is an international offshore energy company that provides development solutions and other key life of field services to the energy market as well as to its own oil and gas business unit.
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Asia still needs international oil companies to continue to play a large and essential role in the oil and gas industry’s research and development activity, despite the rise of national oil companies, a group of the region’s oil and gas industry leaders has stated during the round table discussion event organized by GL Noble Denton in order to to generate research information for a forthcoming Economist Intelligence Unit (EIU) report on the outlook for the oil and gas industry in 2012 and beyond.
A mix of senior representatives from international oil companies, technical suppliers and industry associations attended the event and offered their opinions on where the industry is going and the challenges and obstacles that await it in the future.
One of the key findings is that the rise of Asia’s national oil companies (NOCs) does not mean international oil companies (IOCs) will be marginalized in the region. State-owned oil companies have played a leading role in developing Asia’s growing profile in the international energy market over the past decade. Overall, NOCs now control about 80% of the world’s oil reserves. Research gathered for the EIU 2012 report shows that just 15% of respondents expect to see a more favorable approach to working with international companies from governments and NOCs, a 10% drop on last year’s figure. However, according to the energy industry leaders participating in the GL Noble Denton event, Asia will continue to count on global players to provide the innovation that is critical to the safe and efficient exploration of more challenging environments.
The growth of China’s oil and gas industry
China’s place in the Asian energy market remains difficult to predict, leading the Singapore round-table attendees to offer conflicting opinions on how heavily its neighbors will be impacted by China’s growth. Some believed that the rise of China’s prominence in the Asian oil and gas industry was likely to have a significant commercial impact on other countries, once issues of quality have been overcome. Others, however, felt that China’s interests in oil and gas projects outside of the Asian region will mean its growth was less likely to impact upon other countries in the market.
Concerns over skill shortages
The Asian energy market is at particular risk of under-resourcing itself over the next decade. Concern over skills shortages in the region reflect similar anxieties across the oil and gas industry. However the rapid growth in energy demand across the region, means the need to address this problem is particularly acute. Sustaining this growth will require unprecedented numbers of oil and gas professionals. Participants at the round table suggested that companies broaden the pool of candidates that they could draw upon by requiring fewer years of technical experience.
The discussions raised around the tables at this event have confirmed the underlying concerns felt within Asia’s oil and gas industry, many of which are linked to the rapid expansion the region is experiencing,” said Richard Bailey, GL Noble Denton’s Executive Vice President for the Asia Pacific,who hosted the event.
“The Asian oil and gas industry is clearly focused on its future challenges, and the opportunities that lie ahead, and GL Noble Denton continues to support its key players in developing the innovative solutions they need to meet the region’s evolving energy demands, “ he said.
CGGVeritas, the world’s largest seismic surveyor of oil fields, surged to a two-month high after reporting a profit in the third quarter and strong demand for equipment.
Net income was $41 million compared with a loss of $33 million a year earlier, the company said today in a statement. That beat the $23 million average estimate of seven analysts surveyed by Bloomberg. Sales climbed 21 percent to $797 million.
The French seismic company said it is “confident” in achieving its objectives this year.
CGGVeritas rose as much as 11 percent to 18.10 euros, the highest intraday price since Sept. 1, before paring gains to trade up 90 cents at 17.15 euros at 9:48 a.m. in Paris. The shares are down 25 percent since the start of the year.
Rates for surveying vessels are likely to rise in the second half of this year as oil companies plan to spend more on exploration and production, CGGVeritas, which conducts seismic studies and sells equipment to estimate the size of oil and natural-gas deposits, has forecast. President Barack Obama’s administration yesterday announced plans for 15 offshore oil- lease sales from 2012 to 2017 in the Gulf of Mexico and off Alaska’s coast.
CGGVeritas’ “good set of results” combined with the U.S. offshore leasing plan is positive for the company, Bertrand Hodee, an analyst at Kepler Capital Markets, said in a note today. Kepler has a “buy” rating on the stock.
The company’s backlog at the end of the quarter fell to $1.24 billion compared with $1.31 billion the previous quarter.
CGGVeritas reported a group operating margin of 12 percent, compared with 4 percent a year earlier. The measure of profitability grew to 32 percent for its Sercel seismic equipment division from 30 percent a year earlier and was 9 percent for the service business from a negative 4 percent.
“We expect demand for seismic equipment to remain strong, activity to build globally in key basins and marine overcapacity to progressively be absorbed,” Chief Executive Officer Jean- Georges Malcor said in the statement. “Strong underlying oil and gas fundamentals” are expected to drive “high levels” of demand for seismic surveys.
The seismic company seeks to achieve a positive free cash flow this year and has forecast that a performance plan will help raise operating income by $75 million.
The French surveyor, created in 2006 when Massy, France- based Compagnie Generale de Geophysique SA bought Houston-based Veritas DGC Inc., has about 65 percent of the global market for seismic equipment and around a third of the market for services, executives have said.
By Tara Patel (Bloomberg)
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