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Storm of Resolve operation in Yemen may have strong impact on oil prices - Russian experts

March 27, 2015, 17:18 UTC+3 Zamyatina Tamara

MOSCOW, March 27. /TASS/. A military operation launched by Saudi Arabia against Yemen with the support of some Persian Gulf countries on Thursday may become a protracted armed effort and seriously affect world oil prices, experts polled by TASS said on Friday.

Late on Wednesday the Saudi Air Force launched Operation Storm of Resolve with the support of aviation from Bahrein, Qatar, Kuwait and the United Arab Emirates against Shia rebels who have seized control of a considerable part of Yemen.

Egypt, Jordan, Morocco and Sudan have also joined the Saudi-led coalition. The United States is providing "logistical and intelligence support" to the military operation, spokeswoman for the US White House’s National Security Council Bernadette Meehan said. Moscow stands for resolving the crisis through negotiations.

"Saudi Arabia has launched the military operation against Yemen because Yemeni Shia rebels can simply wipe the kingdom off the face of the earth. Yemen has a population of about 25 million people while they have over 70 million firearms," President of the Institute for Middle East Studies Yevgeny Satanovsky told TASS.

"The start of air strikes against Yemen has caused a sharp jump in world oil prices. The combat operations may affect supplies because Yemeni coastal waters provide a route for oil tankers from the Persian Gulf to Europe. That is why, oil prices will directly depend on Operation Storm of Resolve," the expert said.

"it is well-known that Yemenis have a negative attitude to Saudis, which can be explained not only by the standoff between Shias and Sunnis but also by a contrast in living standards that are ten times higher in Saudi Arabia than in Yemen. A very serious factor is that up to two million poor Yemenis are working in Saudi Arabia and they may turn into rebels within a short time, if necessary. Saudi Arabia fears that the conflict may spill over to its eastern regions populated by Shias. These areas are the place where the richest oil reserves are concentrated," Satanovsky said.

"Yemen is a power base for al-Qaeda and the homeland of the family of [Osama] bin Laden. This country is full of terrorists, radicals and Islamists. Considering that an undeclared war is going on between Saudi Arabia and Iran, which supports Yemeni Shias and this is a constant factor, the current conflict in the Middle East may stay for long," the expert said.

Experts say oil price fluctuations will directly depend on the continuity and the scope of Operation Storm of Resolve but assess differently the prospects for the development of the situation.

"The Persian Gulf countries have come in support of the military operation initiated by Riyadh against Yemen, fearing the strengthening of the Shia grouping supported by Iran. This is part of a big Sunni-

Shia war in the Middle East. Tehran will not directly fight in defense of Yemeni Shias. Nor will it provide military assistance to them because the US has unambiguously pledged to keep a close watch on the developments," Deputy Director of the Institute of Military and Political Analysis Alexander Khramchikhin told TASS.

"The coalition of the countries that have united their efforts against Yemen won’t be able to crush the rebels with air strikes alone. The coalition does not rule out the commencement of a ground operation with the support of Egypt and Pakistan. In this case, the coalition members will suppress the rebels by their massive force but the military operation may become a long drawn-out effort," the expert said.

"There were no other causes, except Saudi’s military operation launched against Yemen, for a noticeable growth in Brent crude prices, which jumped by 6% on Thursday because Saudi Arabia is not only a major producer but is also the largest oil exporter in the world," former BP-Russia Director of Analysis Vladimir Averchev told TASS.

"I believe this was the market’s situational, nervous reaction to the start of combat operations. Already today, on Friday, oil prices have started to move down."

"Unless the local operation of the Persian Gulf countries against Yemen grows into a larger-scale war of major players in the Middle East, Storm of Resolve will not exert strategic influence on the world oil market, like in the case of air strikes against the Islamic State’s positions," the expert said.

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