Saudi-Qatar Crisis: Reasons Behind The Fallout Between Gulf Neighbours Explained 

Qatar, the tiny peninsular nation in the Persian Gulf, floating on huge reserves of natural gas, found itself as the odd one out on Monday (5 June). In a coordinated move, Saudi Arabia, Egypt, the United Arab Emirates, Yemen, Libya and Bahrain severed their ties with the country, including transport links, accusing it of supporting terror outfits. The move opened up the worst rift in years among the most powerful states in the Gulf, sending shockwaves through the energy industry.

Saudi Arabia, the de facto leader of the Arab world, has accused Qatar of supporting militant groups backed by its regional arch-rival Iran and broadcasting their ideology, an apparent reference to Qatar's state-owned channel Al Jazeera.

The conflict appears to be a repetition of the crisis that unfolded in 2014, when the same countries called their diplomats back from Doha over a similar set of concerns. Although the stand-off was resolved within nine months, the core issue - Qatar’s support for Iran’s agenda - very much remained.

However, to spark off a new conflict, there had to be a recent irritant in the relationship between these states. Serving that purpose, reports emerged late last month that the Qatari Emir, Tamim bin Hamad al-Thani, had in a speech criticised America, offered support for Iran, reaffirmed Qatar's support for Hamas and the Muslim Brotherhood, and said Qatar's relations with Israel were "good".

Although Qatar claimed that the statements related to Iran and Israel inserted into the news report were the result of a hack, Saudi Arabia and the Gulf didn’t buy it. However, just a week later, Qatari Emir made another gutsy move. He called Iran’s President Hassan Rouhani to congratulate him for being re-elected, even though he knew that the move would rankle Riyadh.

Qatar has long been seen as an anchor of instability in the Gulf. It has, in the past few years, made strange foreign policy choices. It hosts a United States airbase on its soil, but, according to Iraqi officials, allows its citizens to privately fund the Islamic State. It claims to have good relations with Israel, but is a big supporter of Hamas. It is a Wahhabi kingdom with a majority Sunni population, but has strong ties with Shia Iran. Despite being a monarchy, it backs the Muslim Brotherhood.

Qatar’s support for Islamists, especially the Muslim Brotherhood and Hamas, has not gone down well with the rest of the Arab world, mostly Saudi Arabia, which is leading the Islamic Military Alliance, a ‘counter-terrorist’ alliance of Sunni-majority Muslim countries headed by Raheel Sharif, former Pakistan Army Chief.

Hatched by Saudi Arabia, the main aim of the alliance, as opposed to its stated objective of fighting terror outfits seeking to destabilise the region, is to limit Iran’s influence in the Middle East and to unite the Sunni-majority Muslim world against the Shiite Iran that seeks to dominate the region. The fact that Qatar is a part of the alliance further complicated the situation.

Saudi Arabia and Iran, currently fighting a proxy war in Yemen, are always on the opposing ends of every conflict in the Middle East. The two countries compete for influence in the Middle East and support rival groups in the Syrian civil war. This conflict could emerge as another point of contention between the two sides.

Iran, behind-the-scenes target of the move, has already responded by accusing the United States of pulling the strings, and has offered to transport food and medical supplies to Qatar, which may plunge into food crisis as its only land border with another country, Saudi Arabia, has been sealed as part of a travel embargo.

With support from US President Donald Trump, who has been tough on Iran with his words, and the newfound confidence following its intervention in Yemen, Saudi Arabia is in a stronger position and may not be willing to back down, like it did after a nine-month long stand-off in 2014.

“The argument to President Trump may be compelling: with US help, Qatar might be persuaded to evict Hamas leadership from Doha and genuinely cut back on funding Islamist groups,” a BBC report noted, adding that the time of Qatar's individualistic foreign policy and willingness to ignore the wider consensus of the regional group of the monarchies, the Gulf Co-operation Council (GCC) may be up.

Qatar, which now finds itself both regionally and economically isolated, may have few cards left to play. However, if it chooses to escalate, Qatar would become a new battleground for Riyadh and Tehran.

The crisis may have both human and economic cost. Although the human cost may not be visible in the short term, the economic cost is evident from day one. The unprecedented situation left Qatar's main share index more than 7 per cent lower on Monday (5 June) amid worries about the investment climate. Oil prices finished lower on Monday as the crisis has raised uncertainty about oil production in the Middle East.

The fuel to watch, though, is not oil but gas. Qatar is one of the smallest oil producers in the Gulf, but is the world’s largest liquefied natural gas exporter. If the dispute deepens, Qatar’s export of natural gas could be interrupted, crippling its economy.

Arab nations have also banned their citizens from traveling to Qatar. Millions of workers from these countries, who live and work in Qatar, have been given 14 days to leave the country. Loss of that workforce would pose a problem for industries and firms, both local and international, operating in Qatar.

The crisis would affect India too. Apart from foreign policy challenges that it would present, the crisis would put at risk over 650,000 Indians who live and work in Qatar. Indians are the largest expatriate community there. Over 90 per cent of India’s natural gas imports, which come from Qatar, could also be at risk if the crisis deepens.