Excerpts: US to overtake Saudi petroleum production.8,000+Iraqi pilgrims
smuggled to Haj.Erdogan wants Assad gone. Israel, Palestinians agree talks
futile.Convert to Islam and pay $500. October 01, 2014


+++SOURCE: Saudi Gazette 1 Oct.’14:”US seen to overtake Saudi petroleum
production”,Reuters
SUBJECT: US seen to overtake Saudi petroleum production
QUOTE: The economy of Saudi Arabia is dependent on petroleum exports which
accounted for 85% of export revenues in 2013”
EXCERPTS:PARIS/LONDON – US liquefied petroleum output is set to overhaul
Saudi Arabia in September or October, for the first time since 1991. In
terms of crude oil production, the US is still third behind, with Russia in
the lead.

US production of liquid petroleum reached 11.5 million barrels per day, on
track to outpace Saudi Arabia’s 11.6 million barrels in the next few months,
according to August data from the International Energy Agency, published on
Sept.10.

Saudi Arabia is the second-largest petroleum exporter to the US, but as
domestic production increases in America, less is needed from abroad.

The shale oil boom in the US began in 2008 and has increased US crude output
by 60 percent. In 2012, the United States became a net exporter of liquefied
petroleum gases for the first time.

Between January and March 2014, Saudi Arabia exported an average of 1.5
million barrels per day to the US.

Saudi Arabia is the largest exporter of petroleum liquids in the world and
is home to the world’s largest proven crude oil reserves, 16 percent of the
world’s total.

Even though the US is poised to become the petroleum king, Americans won’t
notice a big difference at the pump. Gas prices on average in the US are
$3.34 per gallon whereas in Saudi Arabia its $0.78 per gallon.

The economy of Saudi Arabia is dependent on petroleum exports, which
accounted for 85 percent of export revenues in 2013, according to an OPEC
study. Oil and gas represent 68 percent of Russia’s total exports.

However, in terms of crude oil production, Russia is still the world’s
leader with 10.1 million barrels per day, with Saudi Arabia coming in second
with 9.7 million barrels per day. The IEA said the US could catch up with
Saudi Arabia and Russia in crude production by the end of the decade.

Production in Russia has fallen in recent months, and could be hit further
in the wake of sanctions, which will deprive Russian companies of EU and US
partners in Arctic, deep-sea, and shale projects. A quarter of Russia's
total oil production depends on shale. . . .

The sanctions will also create problems for Western companies like
ExxonMobil, BP, Shell and others, who have joint ventures worth billions of
dollars in Russia.— Reuters

+++SOURCE: Saudi Gazette 1 Oct.’14:”More than 8,000 Iraqi pilgrims smuggled
out of IS-controlled areas”,Saudi Gazette report
SUBJECT: 8,000+ Iraqi pilgims smuggled out of IS areas

FULL TEXT:MAKKAH — Around 8,345 Iraqis who live in areas controlled by
Islamic State were smuggled out in order to leave for the Kingdom to perform
Haj, said the head of Iraqi Haj delegation and the country’s undersecretary
of Haj, Makkah daily reported.

The trip was risky and pilgrims had to put their lives on line for the sake
of performing the pilgrimage, Kamal Issawi said.

“Some of them marched through the Euphrates River in pitch-black darkness
and had to walk over wood bridges to get to the other end while some were
taken to remote areas then whisked away by military airplanes to Baghdad
airport,” Issawi said.

It was an arduous task to get the Sunni pilgrims unscathed out of the areas
that have been witnessing fierce clashes, he said.

Some pilgrims were transported to Kirkuk Governorate, north Iraq, which is
currently under the control of Kurdistan, and were asked to stay inside
mosques until they had been taken to Al-Sulaimaniya Airport, despite the
fact Kurdistani authorities initially refused to transport them to the
airport, he claimed.

“We didn’t lose hope and were determined to accomplish our task. “We
succeeded in convincing Kurdistan authorities to help us.”

During the era of former Prime Minister Noori Al-Malki, Mosul’s Sunni
population was banned from performing Haj. However, the ban was lifted.

This year there are 26,922 Iraqi pilgrims, 50 percent of whom come from
Sunni and Kurdish areas.

They all arrived through Prince Muhammad Bin Abdulaziz Airport in Madinah.
Issawi thanked Saudi authorities for all facilities provided to Iraqi
pilgrims.



+++SOURCE: Saudi Gazette 1 Oct.’14:”Turkey will fight Islamic State, wants
Assad gone – President Erdogan”, by Orhan Coskun, Reuters
SUBJECT: Erdogan wants Assad gone
QUOTE:”Turkey will fight Islamic State, wants Assad gone”
FULL TEXT:ANKARA — Turkey will fight against self proclaimed Islamic State
and other "terrorist" groups in the region but will stick to its aim of
seeing Syrian President Bashar Al-Assad removed from power, Turkish
President Tayyip Erdogan said on Wednesday.[1 Oct.]

The advance of Islamic State insurgents to within sight of the Turkish army
on the Syrian border has piled pressure on Ankara to play a greater role in
the US-led coalition carrying out air strikes against the insurgents in
Syria and Iraq.

"We will fight effectively against both (Islamic State) and all other
terrorist organizations within the region; this will always be our
priority," Erdogan said in a speech at the opening of parliament.

"We will (also) continue to prioritize our aim to remove the Syrian regime,
to help protect the territorial integrity of Syria and to encourage a
constitutional, parliamentary government system which embraces all (of its)
citizens."

Turkey shares a 1,200 km (750-mile) border with Iraq and Syria and is
already struggling with 1.5 million refugees from the Syrian war alone.

It deployed tanks and armoured vehicles on the border with Syria this week
as fighting intensified and the government has sent a proposal to parliament
which would extend its powers to authorise cross-border military incursions.

But it fears that US-led air strikes, if not accompanied by a broader
political strategy, could strengthen Assad and bolster Kurdish militants
allied to Kurds in Turkey who have fought for three decades for greater
autonomy.

"Tons of air bombs will only delay the threat and danger," Erdogan said,
adding that the safe return of Syrian refugees in Turkey was also a
priority.

"We are open and ready for any cooperation in the fight against terrorism.
However, it should be understood by everybody that Turkey is not a country
in pursuit of temporary solutions nor will Turkey allow others to take
advantage of it." — Reuters


+++SOURCE:Naharnet (Lebanon) 1 Oct.’14:”Israel,Palestinians Finally Agree on
Futility”, Agence France Presse

SUBJECT: Israel,Palestinians agree talks futile

FULL TEXT:Months after the collapse of U.S.-led efforts to advance Middle
East peace, experts say Palestinians and Israelis have finally agreed on at
least one thing -- further talks would be futile.And, as has so often been
the case in the intractable conflict, neither side looks set to propose any
kind of meaningful alternative.

Over the past week, speeches by the two leaders at the U.N. General Assembly
have laid bare how far apart the two sides remain, six months after
Washington's latest peace push fell apart.

President Mahmud Abbas fired the first volley, telling U.N. delegates on
Friday[26 Sept.] it was impossible to return to "the cycle of negotiations
that failed to deal with the substance of the matter and the fundamental
question" of Palestinian statehood.

In strong language reserved normally for an Arab audience, Abbas accused
Israel of waging a "war of genocide" during the recent conflict in Gaza,
which killed nearly 2,200 Palestinians, most of them civilians, and 73 on
the Israeli side.

Experts said the 79-year-old Abbas, who has led the Western-backed
Palestinian Authority for nearly a decade, made clear he has no more
patience for Washington's longstanding peace efforts.

"The most important point from the speech is that the Palestinians are now
rejecting American supervision of the negotiations, which for years have led
to nothing," said Wasel Abu Yussef, a senior member of the Palestine
Liberation Organization.

Israeli Prime Minister Benjamin Netanyahu, famed for his bombastic [IMRA:
‘bombastic ?] speeches at the Assembly, also left no doubt during his
address on Monday[29 Sept.] that he saw no future in pursuing talks in their
current format.

Accusing Abbas of spreading "brazen lies", Netanyahu said it was time to
move on from the framework of direct peace talks -- as laid out nearly 20
years ago in the Oslo Accords.

"The old template for peace must be updated," he said.

That template -- meant to deal with so-called "final status" issues like the
return of Palestinian refugees, the border of a Palestinian state and the
fate of Jerusalem -- was revived during the nine months of U.S.-backed
negotiations that collapsed in April.

Following intensive diplomatic efforts by U.S. Secretary of State John
Kerry, Israeli and Palestinian negotiators agreed to sit down in July 2013
for their first direct talks in three years.

But as the months wore on with little progress, Washington tempered its
expectations, first giving up on hopes of a comprehensive peace deal to
focus on a framework agreement, then simply trying to keep the two sides
talking.

Although the talks eventually collapsed following a dispute over Israel's
failure to free Palestinian prisoners and Israeli fury over a unity deal
between rival Palestinian factions Hamas and Fatah, the main stumbling block
was the ongoing construction of Jewish settlements.

A few months later, a bloody seven-week war between Israel and Hamas
militants in Gaza put paid to any remaining illusions about a resumption of
talks.

The Palestinians are now focusing on other diplomatic avenues to achieve
their promised state, including moves to secure a U.N. Security Council
resolution setting a time-frame for ending the occupation.

They are also mulling a war crimes case against Israel at the International
Criminal Court, though they have not yet joined the body despite being able
to do so since winning the rank of U.N. observer state in 2012.

Abbas is even said to be considering breaking off crucial political,
economic and security agreements with Israel, including his forces'
coordination with the Israeli army in the West Bank -- a source of much
Palestinian criticism.

But analysts say alternative strategies can only work if Abbas has the will
to follow through -- and so far there is no sign of that.

"Abbas's threats have always been empty because the Palestinian Authority
has its hands tied by agreements signed with Israel, is politically
dependent on the United States and is economically dependent on Europe and
international organizations," said Karim Bitar, a Middle East expert based
in Paris.

Abbas is meanwhile struggling with his own falling popularity, with a recent
post-war poll showing he would come second to Hamas's former Gaza premier
Ismail Haniya if presidential elections were held now.

The same poll also found only 29 percent of Palestinians believed talks were
the best way to obtain a Palestinian state, with 44 percent saying they
believed armed struggle was more effective.

On the Israeli side, the suggestions of a new way forward are even more
vague.

In his speech, Netanyahu suggested the combined threats posed by Iran's
nuclear program and the Islamic State jihadist group would create "new
opportunities" for Israel to work with "Arab partners".

But he offered no details and Israel's left-leaning Haaretz newspaper said
any talk of a new partnership with the Arab world was "imaginary".

Still, some analysts say Abbas may not have given up entirely on the peace
process.

Salman Shaikh of the Brookings Doha Center said the "hyperbolic and
exaggerated" language of Abbas's speech was mainly meant to "express the
frustration" felt by many Palestinians.

"Does it close the door to peace? No," Shaikh said. "Abbas tried to put
pressure on the U.S. and the international community."

SourceAgence France Presse



+++Source:Jordan Times 2 Oct.’14:”Wheat warfare: Islamic State uses grain to
tighten grip in Iraq”, Reuters

SUBJECT:Convert[to Islam] and pay $500

QUOTE:((0r)”We are taking your wheat.Just to let you know we are not
stealing it because we gave you a choice”

FULL TEXT:SHEKHAN, Iraq — For Salah Paulis, it came down to a choice between
his faith and his crop.

A wheat farmer from outside Mosul, Paulis and his family fled the militant
group Islamic State early last month. The group overran the family farm as
part of its offensive that captured vast swathes of territory in northern
Iraq. Two weeks later, Paulis, who is a Christian, received a phone call
from a man who said he was an Islamic State fighter.

"We are in your warehouse. Why are you not here working and taking care of
your business?" the man asked in formal Arabic. "Come back and we will
guarantee your safety. But you must convert and pay $500."

When Paulis refused, the man spelled out the penalty. "We are taking your
wheat," he said. "Just to let you know we are not stealing it because we
gave you a choice."

Other fleeing farmers recount similar stories, and point to a
little-discussed element of the threat Islamic State poses to Iraq and the
region.

The group now controls a large chunk of Iraq's wheat supplies. The United
Nations estimates land under IS control accounts for as much as 40 per cent
of Iraq's annual production of wheat, one of the country's most important
food staples alongside barley and rice. The militants seem intent not just
on grabbing more land but also on managing resources and governing in their
self-proclaimed caliphate.

Wheat is one tool at their disposal. The group has begun using the grain to
fill its pockets, to deprive opponents — especially members of the Christian
and Yazidi minorities — of vital food supplies and to win over fellow Sunni
Muslims as it tightens its grip on captured territory. In Iraq's northern
breadbasket, much as it did in neighbouring Syria, IS has kept state
employees and wheat silo operators in place to help run its empire.

Such tactics are one reason IS poses a more complex threat than Al Qaeda,
the Islamist group from which it grew. For most of its existence, Al Qaeda
has focused on hit-and-run attacks and suicide bombings. But Islamic State
sees itself as both army and government.

"Wheat is a strategic good. They are doing as much as they can with it,"
said Ali Bind Dian, head of a farmers' union in Makhmur, a town near IS-held
territory between Erbil and Mosul.

"Definitely they want to show off and pretend they are a government."

The Sunni militants and their allies now occupy more than a third of Iraq
and a similar chunk of neighbouring Syria. The group generates income not
just from wheat but also from "taxes" on business owners, looting, ransoming
kidnapped Westerners and, most especially, the sale of oil to local traders.
Oil brings in millions of dollars every month, according to estimates by
Luay Al Khatteeb, a visiting fellow at the Brookings Doha Centre in Qatar.
That helps finance IS military operations — and is why IS-held oilfields in
Syria are targets in US-led air strikes.

"Islamic State presents itself as exactly that, a state, and in order to be
able to sustain that image and that presentation, which is critical for
continued recruitment and legitimacy, it depends on a sustainable source of
income," said Charles Lister, another visiting fellow at the Brookings Doha
Centre.



Seizing crops

and livestock



In early August, Kurdish farmer Saeed Mustafa Hussein watched through
binoculars as armed IS militants shovelled wheat onto four trucks, then
drove off in the direction of Arab villages. Hussein said he does not know
what became of his wheat. But he knows that IS runs flour mills in areas it
controls and he believes that his wheat was likely milled and sold.

He had 54 tonnes of wheat on his farm in the village of Pungina, northeast
of Erbil, wheat he had been unable to sell to a government silo or private
traders because of fighting in the area.

The militants also took 200 chickens and 36 prized pigeons.

"What made it worse was that I was helpless to prevent this, I couldn't do
anything. They took two generators from the village that we had recently
received from the Kurdish government after a very long process," said
Hussein.

Residents are too scared to return even though Kurdish fighters are now in
control. "We think the Islamic State laid mines to keep us from going back,"
said neighbour Abdullah Namiq Mahmoud.

There are scores of similar stories at displacement camps across Kurdistan.

"We escaped with our money and gold but left our wheat and furniture, and
everything else," said farmer and primary school teacher Younis Saidullah,
62, a member of the tiny Kakaiya minority.

"Everything we built for 20 years using my salary and our farming: It's all
gone. We are back to zero," he said, sitting on the floor of a tent at a
United Nations-run camp on the outskirts of Erbil.



Military and economic power



After Saddam Hussein's 1990 invasion of Kuwait triggered Western sanctions,
the then-Iraqi dictator built a comprehensive subsidised food distribution
system in Iraq. That was expanded under the United Nations' Oil-for-Food
programme. Joy Gordon, a political philosophy professor at Fairfield
University in Connecticut and author of the 2010 book "Invisible War: The
United States and the Iraq Sanctions," estimates that two-thirds of Iraqis
"were dependent primarily or entirely" on food subsidies between 1990 and
2003.

The system survived the US invasion and years of violence. Now fully run by
the Iraqi government, it has been plagued in recent years by "irregular
[food] distributions" that have cut dependency, according to a June report
by the United Nations' Food and Agriculture Organisation. A former US
Department of Agriculture economist estimates that about quarter of Iraqis
living in rural areas were dependent on subsidised food before the latest
violence, while another quarter used it to top up food they bought.

IS is demonstrating that controlling wheat brings power. As its fighters
swept through Iraq's north in June, they seized control of silos and grain
stockpiles. The offensive coincided with the wheat and barley harvests and,
crucially, the delivery of crops to government silos and private traders.

IS now controls all nine silos in Nineveh Province, which spans the Tigris
river, along with seven other silos in other provinces. In the three months
since overrunning Nineveh's provincial capital Mosul, IS fighters have
forced out hundreds of thousands of ethnic and religious minorities and
seized hundreds of thousands of tonnes of wheat from abandoned fields.



A silo under attack



One target was the wheat silo in Makhmur, a town between the cities of Mosul
and Kirkuk. The silo has a capacity of 250,000 tonnes, or approximately 8
per cent of Iraq's domestic annual production in 2013.

IS attacked Makhmur on August 7. But even in the weeks before that, the
group had found a way into the silo and the Iraqi state procurement system.

Abdel Rizza Qadr Ahmed, head of the silo, believes that IS forced local
farmers to mix wheat produced in other, IS-controlled areas into their own
harvest. The farmers then sold it to Makhmur as if it all had been grown
locally. In the weeks before the attack, the silo purchased almost 14,000
more tonnes than it had in 2013. That extra wheat is worth approximately
$9.5 million at the artificially high price Baghdad pays farmers.

Ahmed believes IS was looking to make money from the wheat and ensure there
was bread available for Sunnis in the areas it controlled.

Ahmed said it was not his job to investigate the source of the grain, just
to buy it. "We just take the wheat from the farmers and we don't ask 'Where
did you get this from?'" he said.

Huner Baba, local director general of agriculture, said he too believed that
traders and farmers had sold wheat from outside the region.

But Baghdad usually pays its wheat farmers around two months after they
deposit their produce and so wheat farmers around Makhmur — and therefore
IS — had not yet been paid by the time IS militants entered the town on June
7 and, according to Baba, headed for the silo.

The militants were met by Iraqi Kurdish fighters, known as Peshmerga, and
fighters from the Kurdistan Worker's Party (PKK). After IS took the silo,
Baba said, they installed snipers there. He speculates that the militants
believed US warplanes would not strike the facility, which is in the centre
of town.

"They want to get people on their side especially the Arabs. Maybe that's
why they didn't do anything to the wheat, not to anger people," he said.

IS held Makhmur for three days before the Kurdish fighters and US air
strikes on IS positions — though not on the silo — drove them out. US-led
air strikes did hit grain silos in the northern Syrian town of Manbij on
September 28. A group monitoring the war said the aircraft may have mistaken
the mills and grain silos for an Islamic State base. There was no immediate
comment from Washington.



Smooth transition



In many ways, IS is replicating in Iraq strategies it developed in Syria. In
the year it has controlled the town of Raqqa in northeastern Syria, for
instance, IS militants say they have allowed former employees from Assad's
regime to continue to run its mills. The group has set up a wheat "diwan",
or bureau, in charge of the supply chain, from harvesting the crop to
distributing flour.

The same push to keep things running smoothly can be seen in Iraq. IS
fighters have regularly avoided destroying government installations they
have captured. When IS took over Iraq's largest dam it kept employees in
place and even brought in engineers from Mosul to make repairs.

Baghdad, too, has tried to minimise upheaval.

Hassan Ibrahim, head of Iraq's Grain Board, the trade ministry body
responsible for procuring Iraq's wheat internationally and from local
farmers, said that government employees in IS-held areas keep in regular
touch with head office. Some staff in IS areas even come to Baghdad every
couple of weeks, he said.

In the past few weeks, he said, IS fighters had disappeared from some areas
in Mosul and Kirkuk because of the US-led air strikes. "The situation is
stable," he said, with IS fighters mostly happy to allow state employees to
continue to run the silos.

"I give instructions to my people to try to be quiet and smooth with those
people because they are very violent people. It is not good to be violent
with violent people because they will come to kill you. Our aim is to keep
the wheat."

After IS's June offensive, Ibrahim was ordered to suspend salaries for
workers in IS areas. "But this troubled me," he said. "I cannot have the
mills stopping. I need people to stay there like guards to convince the
Islamic State that wheat is important for everybody."

Ibrahim says he convinced his bosses to keep paying salaries. A trade
ministry spokesman confirmed that all government employees in Mosul had been
paid their salaries "through state banks in Kirkuk, as it's safer and under
government control".

Ibrahim is now worried about farmers who have not been paid for the wheat
they delivered in the weeks before the grain was seized by IS.

He said the Grain Board and the Trade Ministry were trying to pay farmers
either living in IS-held areas or recently displaced from them. "We would
like to help the farmers, but not IS," he said.



Winning hearts

and stomachs



In some places, the IS stranglehold on wheat appears to be winning support
among Sunnis.

Ahsan Moheree, chairman of the government-affiliated Arab Farmers Union in
Hawija, says IS has gained in popularity since its fighters took over.
Baghdad's dismissive attitude towards the country's Sunni Arabs had forced
people towards IS, he said. But IS' ability to provide food had also helped.

"They distribute flour to the Arabs in the area. They get the wheat from the
Hawija silo... And they run the mill and they distribute to people in a very
organised way," he said.

Even those who have fled IS see wheat as one reason for the group's
strength.

"Nowadays a kilo of wheat is 4,000 or 5,000 dinars [$3.45-$4.30]. It used to
be 10,000 to 11,000 dinars," said Joumana Zewar, 54, a farmer who now lives
in Baharka camp outside Erbil. IS and Sunni Arabs are selling the wheat they
stole "for very cheap. It's cheap because they stole it".

Zewar called a friend in Mosul to check on the latest prices.

"The price of foods and bread is very cheap," the friend said. Islamic State
had taken control, and as in Syria, was dictating prices. "They are the
government here now. They are going to the bakeries and saying, 'Sell at
this price'."



The year ahead



The big worry now is next season's crop. In Nineveh province, home to the
capital of the group's self-declared caliphate, 750,000 hectares should soon
be sown with wheat and 835,000 hectares with barley, an Iraqi agriculture
ministry official said.

The official said that the province normally has 100,000 farmers. But
thousands have fled.

Iraqi farmers normally get next season's seeds from their current harvest,
keeping back some of the wheat for that purpose. IS controls enough wheat so
finding seeds should not be a problem. It also controls ministry of
agriculture offices in Mosul and Tikrit which should have fertiliser
supplies.

But getting the seeds and fertiliser into the right hands will be a problem.
Mohamed Diab, director of the World Food Programme's Regional Bureau for the
Middle East, North Africa, Central Asia and Eastern Europe, said that it is
"highly unlikely" that displaced farmers would return.

"The picture is bleak regarding agriculture production next year," he said.
"The place where displacement has happened is the main granary of the
country."

That's especially true for non-Sunni Arab farmers. Those who have remained
on their land just outside IS-held territory fear the militants will soon
take their villages, and their harvested but unsold crops.

Even if that does not happen, they say, they will not plant after the first
rain, which typically comes at the end of September or in early October.

Farmers in the town of Shekhan, nestled among sun-bleached wheat fields, say
they have no hope of getting the seeds, fertiliser and fuel needed to plant
because the provincial government in Mosul is under IS control.

"The real problem is how to get seeds to those inside Mosul and surrounding
areas," said Nineveh Governor Atheel Nujaifi, who believes production will
drop next season.

Bashar Jamo, head of a local farmers' cooperative, is also worried. "The
most important thing to us is agriculture, not security. Maybe [IS] will
have a state, maybe an army, but all we need is to be able to farm."
=============
Sue Lerner - Associate, IMRA