Chapter 8

Winter was certainly a more pleasant time to be in the Kingdom than the grueling summer, reflected Antoun, resting from the Prince’s tour. The slight breeze moving through the coarse strands of the clustered date palms overhead accentuated the calm day.  A small table nearby was laden with pitchers of ice water and orange juice, sugary dates, cashews, pistachios, a thermos of stout Arabian coffee, and ginger tea.  Antoun had selected ginger tea and a plate of pistachios and cashews for a snack.  The Prince had iced orange juice and dates.  Both men sampled the offerings with some caution, as a much more sumptuous meal would follow later.

The collaborators were silent as if they had already exhausted their reservoirs of conversation.  That was not really the situation, however, as Antoun was collecting his thoughts before the inevitable question arose.  He would beat Tariq to the punch.

He cleared his throat and the Prince looked at him expectantly.  “I came all the way to the Kingdom, my friend, to convey only one thing, really.  I have come to the conclusion that your assumptions are correct and the timing is perfect.  If we are ever going to do so, now is the time to make our big play.  I agree with you that it appears perfectly practical at the moment.”

The Saudi royal shifted abruptly in his chair, a gleam of quiet satisfaction jutting through his eyes.  He signaled the attendants to leave them and kept his silence, allowing his older companion to continue.

“We may start with your favorite commodity: crude oil.  It is the largest actively traded commodity market in the world with more than ample liquidity to execute all of our trades.  We may follow the protocol already discussed and mapped out.  Not only may we make a great deal of money but more importantly from your perspective, the Kingdom will be enriched as well.  There will be a huge transfer of wealth from the West back to the Kingdom.  I can see your point, Prince Tariq; we will raise the entire ocean of oil pricing in the world with Saudi Arabia, the largest producer with one-quarter of the proven reserves on the planet, the natural beneficiary.  The action will accomplish both our personal enrichment objectives and your wildest strategic dreams for your country.  Additionally, Prince Tariq, you may pursue your personal agenda at the same time.”

Tariq noted the last comment.  For the most part, Michel Antoun could be apolitical in his dealings, but that hadn’t always been the case for his family.

Still licking your wounds from the American invasion of Lebanon under Eisenhower, aren’t you Michel?  The one that kept your father from the presidency.  After all these years, the old wounds never heal. 

The Prince had already finished one date and was now fumbling for another.  His mannerisms betrayed quivers of excitement at the prospects outlined by Antoun.  Indeed, his ambitions to inflict maximum economic pain on the infidels, while enriching his and the Kingdom’s coffers, were at hand.  He had waited a long time for this opportunity, to the point of going it alone in the near future.  What had finally turned Antoun around?

“Most interesting, Michel.  Finally, the fruition of almost endless conversations on the matter.  What exactly changed your mind?  You had opposed this in the past.”

Antoun smiled enigmatically.  “Let’s just say that I uncovered recent information regarding the duplicity of the Americans in the 1958 invasion of Lebanon, the invasion that forever denied my father’s chance to become president of my country.  This new information has inflamed me as never before.  My qualms on wreaking havoc on the oil markets and the world economy have dissipated with the realization of their unimaginable treachery against my father.  And, as stated, I now believe the entire concept is feasible.  It can be done.”  Antoun became more forceful with each sentence, spitting out the latter ones almost contemptuously.

His counterpart on the other side of the table was quite taken aback at the Lebanese banker’s emotional fury.  He had not seen him so agitated before; inwardly, he delighted in his guest’s obvious rancor toward the Americans.  Tariq continued to prod, “Very understandable, Michel, and heartening if I may add.  What, exactly, are your ideas?”

“Very simple, really, and along the lines of our previous conversations.  In plain form, we do the following: acquire large volumes of crude oil, essentially load up on it.  Then, cause a dastardly event or series of such.  Prices spike as a result.  Make an ocean of money in the process.  Everyone else thinks terrorists are to blame.  Which is true, except a couple of businessmen are the real terrorists.  They happen to be the ones sitting here.  We have the luxury of designing, scripting, and engineering the events, choreographing the whole thing and using the media for further manipulation.  Sow fear and panic in the marketplace.  Absolutely beautiful and criminally effective, plus we can do it forever.  Terrorism for profit, a most insidious thing.

“It’s natural that we start with crude oil; a strategic commodity to a planet addicted to fossil fuels and, not so incidentally, the Kingdom’s lifeblood.  The Kingdom is enriched in similar manner as ourselves and, in the process, we stick it to the consuming economies.

“We have talked about this concept for such a long time.  Theoretically and academically, that is.  There have been concerns regarding its practical implementation.  With that in mind, it must be stated that never has the global environment been so supportive for such an endeavor as now.  Never has the global supply/demand balance in crude oil been so tenuous; there is little surplus inventory slack, and the refining system will soon be running full throttle and bumping against capacity restraints.  And, much of the other global oil infrastructure, whether in the form of tankers, pipelines, storage and terminal facilities and the like are bottlenecked, decrepit and frayed.  Now is the time to strike and no one will even suspect what hit them.

“The American invasions of Iraq and Afghanistan, and the context of global concerns on terrorism in general, have jump started this ideal environment.  Everyone is inordinately nervous, for lack of a better word, more than ever.  Couple all of that with the totally intrusive character of the global economy, with the Internet and mass media disseminating information at hyper speed, and individuals like us have been leveraged, for good or evil, to the maximum.

“Therefore, crude oil markets are perfectly primed for our assault.  Everyone needs oil and the reverberations of any actions in the markets seep into every corner of the planet.  There are so many global factors impinging upon oil markets that we will get lost in the shuffle, not even appear on the radar.  Pundits will argue fundamentals, such as rising demand for crude oil from China and India, as forcing prices upward.  Others will argue terrorism and the presence of a premium in oil pricing, the so-called risk premium if you will, as responsible for the surge in prices at the pump.  Some will say the weak dollar is a culprit.  But completely unbenownst to all will be the fact that two simple businessmen are actually manipulating the market, on the margin, for themselves at the world’s expense.  We will load up on oil and make sure that the price only goes up.  We will be managing not so much the markets but the events affecting prices.  Our speculative portfolio won’t keep us up at night, not if we are proactively managing events.”

Tariq had by now finished his snack.  Any further appetite could wait; this was important.  A slow smile crept across his face.  Absentmindedly stroking his beard, he leaned back in his chair and took a small sip of his orange juice.  Waves of satisfaction swept across him.  This was excellent news indeed.  It was more than he could have hoped for, belying his earlier fears that Antoun’s persistent unhappiness with laundering money for the resistance groups had lapped over to the one play that really mattered. Certainly, the Prince would make a little money along the way as well.  Why shouldn’t he?  He was exultant that his long argument in favor of the concept of guided terrorism had finally won the banker over.  Antoun might define it as terrorism for profit if he wished, to him it was a constructive guidance or shaping of events designed to inflict economic damage to one’s true enemies.

Equal to the thrill of harming one’s enemies, the Kingdom would be showered with wealth beyond measure, the fulcrum of financial power shifting in its favor, reaping innumerable strategic benefits on top of that pile of money.  Privately, inside a closed circle of younger and more radically inclined princes within the royal family, away from the purview of the doddering monarch, the Prince would be given primary credit for the enterprise.  Certain arrangements might be forthcoming, whereby he might ascend to the throne, his ultimate dream, a throne otherwise beyond his reach in the natural line of succession.  That succession could be altered to make way for him.

Well, Antoun has finally come around, just in time to save his neck.  Had he suspected something?  But, I could use his banking system, Greek refining cover and oil trading group to get the oil play started more quickly versus my own plans.  He still would have to go soon enough. 

“Michel, I am most glad to hear this.  Surprised, but very pleased.  Please describe your concept around the events.”  Tariq fingered another date.

“Events can be engineered and media managed to ensure that market prices go up and stay there, as long as desired.  Market psychology will be at our behest.  Everyone is looking at terrorist groups, religious masses, companies, cartels or countries as probable creators of events, and then in pursuit of other goals.  We merely use terrorists as cover.  No one will suspect that two men, in suits and ties, are doing all of this, actually empowered by global interdependence to be capable of this.  We can manage the marginal price of any commodity. The margin and its management have never been so important.”

Now that was an interesting comment, the one applying to managing the margin.  Tariq replied, “What do you mean specifically, Michel, by your comment regarding management of the margin?”  He knew the answer but was interested in Antoun’s explanation.

“Our actions will be conducted to influence the price of oil on the margin, the so-called spot price of crude oil.  The pricing reflected in the futures markets and on reporting services and so forth.  Since all global oil pricing is interrelated by price differentials, reflecting value differences between the various grades of crude oil across the globe, all we have to do is create a ripple affecting a so-called marker crude and the level of oil pricing around the world is raised.”

A third date had been polished off by now.  The Prince responded, “Your principle is universal to virtually any commodity, Michel.  Any event affecting a strategic commodity, if properly staged and amplified, is a global phenomenon.  The ripple is instantaneous.”

“Precisely.  This is not necessarily new news.  Markets have always been affected by events, only the global effects are much more rapid now.  Weather, wars, accidents and so forth have been typical events.  But, these have always tended to be accidental or conducted on a basis with no reference to a market.  Our emphasis is the actual staging or creation of an event to purposely affect a market.  Not necessarily novel again but, thanks to a very wired world, the possibility of creating economic aftershocks from such activity has never been greater.  It is not as if we are truly revolutionary here, but that the chances of our success are more magnified.

“Additionally ironic, the events to be scripted do not have to be major in any form.  Small events will do nicely, particularly conducted in an endless series, Chinese water torture style, properly enveloped with designed psychological veneers.  Such small events, which I advocate, are well within our own resources and, by their very nature, will appear more as accidents than scripted circumstances.  Until, that is, we overlay them with a terrorist veneer to really jump-start price movements.  The American hedge funds will then start their stupid frenzy and do the rest for us.”

Antoun triumphantly refilled his cup with ginger tea and relaxed in his chair.  He was excited by the scope of the conversation.

“A brilliant exposition, Michel.  Maybe you should teach international commerce at the American University in Beirut.”  Both men laughed heartily.

Tariq pressed forward on the same vein, “Maybe I should rephrase that to say you should teach the Americans a course on international commerce.”  Laughter erupted again.  The echoes wafted across the grounds to the horse corrals where the Arabians were stirring again.

“Oh, they will be taught a lesson all right.  They probably won’t be smart enough to even know.  You have expressed in the past a desire to see the price of oil at $50, $60 or even higher per barrel.  A hundred dollars even.  It enriches the Kingdom and bankrupts the infidel West.  Now you can have it both ways.”

“Absolutely correct, Michel.  Now, oil markets are in the low 30s in terms of dollars per barrel.  I want to see that price doubled or tripled.  Why shouldn’t it be?  And, of course, the majority of events which we design to manipulate oil markets should be scheduled to occur in someone else’s backyard, not in the Kingdom.  There is no point in raising the price of oil if we are not producing or selling to benefit from it.  But, perhaps there might be one event in the Kingdom to really rattle the markets.”

The Prince excitedly carried on, “Michel, let’s discuss the details of our enterprise in more depth at our falcon hunt tomorrow.  The interplay between predator and prey, as we will witness tomorrow, seems an apt backdrop for such discussions.  Correct?” 

Antoun nodded and smiled, “Very apt indeed.”  Folding his arms on his chest, he added, “Prince Tariq, you have formerly expressed that you could create a confederacy of wealthy individuals, companies, or even governments, which might desire to finance part of this effort with a resulting share of the spoils as a reward.  Parties that share your vision of Western economic hardship.  Beyond my banking system, lending the bulk of the money required to leverage the oil position, do you wish to interest these contacts in our grand plan and contribute to our so-called trading pool?”

Tariq smiled benignly.  “I indeed have other contacts that might wish to play with us, using the facilities of your banking system as an intermediary.  None of the others are Saudis, in fact.  They wouldn’t pass up this opportunity to shaft the Americans and their supplicants.”

“I trust, Prince Tariq, you will pull a few other strings on your end, beyond securing the financial backing of others?”

“Absolutely.”

“Excellent, then.  This will be a most amusing scenario and we can blame it all on those despised Islamic terrorists.”

Tariq was impassive for a moment, caught off-guard by Antoun’s quip.  He could grasp the irony, even as his Wahhabist heart beat underneath the folds of his thobe.  The banker really was no better than any of the other infidels.

“Yes,” he replied unflappably, with a smirk spreading across his darkened features, “What is one man’s terrorist is another’s opportunist.”

I am surprised, Michel, you didn’t mention that the timing of our enterprise is perfect for other reasons.  A very large and strategic one comes immediately to mind-the American presidential election.  The stupid Americans’ own president won’t lift a finger to stop us, for fear of exposure, even if he knew or suspected something.  Have you forgotten so soon, my little friend, or are you being so very discreet?  You better be very discreet or I will lay you in the ground faster than you could ever imagine.  The same goes for your wife and child.

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