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In recent weeks the kingdom has displayed an odd mixture of decisiveness and uncertainty in the exercise of its foreign policies. Near to home, the arrests of the alleged Iranian-inspired subversive group in Bahrain produced a remarkably swift and stern response from Saudi Arabia. As well as at once castigating the regime in Tehran for fomenting trouble in the Arab Gulf, the Saudis were quick to act. Within days of the arrests Prince Naif, the Interior Minister, was hot-foot to Bahrain for the signing of a mutual security pact between the two countries. The provisions of the agreement have not been made public but its substance and meaning is clear enough.

The ambiguous outcome of Turkey’s parliamentary elections is bad news for the Gulf and the wider Middle East. The election left Turkey without a clear parliamentary majority and therefore with no strong government. Worse still, the election result demonstrated a polarisation of political opinion that bodes ill for Turkish stability. An unstable coalition government under pressure from nationalists,

Humanitarian concerns have forced a ceasefire in Yemen’s murderous Al-Houthi conflict amid signs that the Arab-Iranian ‘cold war’ is hotting up. With Saudi Arabia and Egypt joining the US in seeing wider regional significance in what has long been understood as a localised conflict, Ali Abdullah Saleh is looking to exploit a difficult situation

Iraq has reduced the illegal surcharges it imposes on oil buyers, but United Nations expert overseers believe it has not abolished them, contrary to some media reports. The surcharges have been trimmed from around $0.35 per barrel to $0.15/b, as the retrospective pricing regime

As the Iran-Iraq war approaches its sixth anniversary, the frustration of both sides seems to be driving them to increasingly desperate tactics. Iraq has now acquired the capability to strike at Iran's makeshift oil export terminals in the lower Gulf, while Iran has taken revenge by attacking Iraqi civilian concentrations.

The month of September saw the worst outbreak of Middle East-inspired violence for many years: the Karachi aircraft hi-jacking tragedy; the Istanbul synagogue massacre; the assassination of the French Military Attache in Beirut; the series of bombings in Paris causing widespread civilian casualties; and the attacks on the French contingent to the UN peace-keeping force in the Lebanon.

The Saudis plan to build a naval base on the barren peninsula of Ra Khumais, just below Qatar on the Gulf, but were hoping not to let their intentions be known. The sensitiveness of the project is two-fold. Building at Ras Khurnays effectively confirms Saudi annexation of the area from the UAE according to an agreement concluded in 1974, promulgated in 1976, but up till now never of any actual relevance. And any indication that the Saudi authorities are constructing naval facilities will give rise to speculation that they are not building them for their own navy, but for the United States.

The smaller Gulf monarchies must respond to change in 2003, as their populations become restive over a range of domestic and international issues. PAGE 3

The expulsion of Yasir Arafat from Syria thrusts the factional schism within the Palestine Liberation Organisation irreversibly into the larger arena of inter-Arab politics. The Syrian action means that other Arab governments can no longer regard the mutiny in the PLO as an internal affair of the Organisation, nor can those governments limit themselves to neutral exhortations to the Palestinians to end the dissension in their ranks.

The contradictory signs emanating from Riyadh over recent weeks – of socially liberalising reforms, a likely easing of some economic reform targets and a fresh crack-down on ‘unhelpful’ commentators – are often hard to make sense of. But within the kingdom they are being read as meaning just one thing: that Crown Prince Mohammed Bin Salman (MBS) has his eyes firmly on the ultimate prize of taking over from his father and whatever needs to be done to ease his path will be done.

The defence chiefs of the six Gulf Cooperation Council (GCC) countries gathered together in Riyadh last week to hammer out a common operational defence for the region. They met during a slight fall in the intensity of the military crisis in the Gulf - a short-lived lull in the Gulf tanker war and with reports- that the promised Iranian land offensive was stalled by a dispute among the leadership in Tehran.

Why has Iran begun to once again allow Iraq to smuggle oil through its territorial waters? The answer is opaque but can probably be found in the interplay of Iraqi-Iranian relations and of US-Iranian relations.

The Gulf countries are in the uncomfortable position of knowing that a large-scale Iranian ground offensive against Iraq is in the offing - and being able to do nothing but wait for the blow. According to one quoted (but anonymous) senior Saudi source: "The common wisdom is that something is coming up within the next several weeks. The idea is to mount another attack that will at least embarrass the Iraqis and push further into the country." The question is not if, but when.

The historic 27 September telephone conversation between Iranian President Hassan Rouhani and his US counterpart Barack Obama has prompted a groundswell of optimism that the nuclear issue could finally be resolved.There are numerous obstacles to overcome however – not least conservative opposition in Iran

The reaction of the various countries of the Gulf region to the stunning development of the agreement between the PLO and Israel contained no surprises for close observers of the regional political scene. This historic breakthrough in the Arab-Israeli impasse is of greater significance, in essence, than the Egypt-Israel peace agreement. The PLO will not be put into diplomatic quarantine by the Arab states, or be excluded from Arab councils and organisations, as Egypt was in 1979.