Middle East Oil War Spreads. First Demos In Saudi Arabia, Iraqi Refinery Blasted

Iraq's biggest oil refinery at Baiji, 180 kilometers north of Baghdad, was blown up early Saturday, Feb. 26, by an Al Qaeda cell activated by the Iranian Revolutionary Guards Al Qods Brigades, debkafile's Middle East sources report. Tehran is using the Middle East turbulence to generate fuel shortages in Iraq and boost oil prices worldwide.

Thursday night, Feb. 24, saw the first signs of unrest in Saudi Arabia with demonstrations by young people demanding reforms of the kingdom's system of government and by Shiites living and working in the kingdom's oil-rich eastern regions. They demonstrated at Awwamiya in Qatif in solidarity with the protests in Libya and Bahrain. They also demanded the release of detainees rounded up by Saudi security authorities among the two million Shiites living and working in the main oil centers of Saudi Arabia to nip potential unrest in the bud.

Friday, in the Red Sea town of Jeddah in the west, a group calling itself "Jeddah Youth for Change staged a demonstration.

The slightest sign of unrest in Saudi Arabia, the world's biggest oil exporter, is bound to affect the price of oil. Iran is the biggest beneficiary of soaring prices. Day after day, as Arab capitals are beset by popular turbulence, Tehran is watching the damage caused its economy by international sanctions shrinking.

The gunmen shot four refinery guards and engineers and blew up the Al Shamal unit, its main kerosene and benzene producer, leaving sticky bombs in other operational units to explode after they fled. It took hours to put the fire out. The entire installation is now closed. "We are not talking about days," said a refinery official, "The damage is too severe."

The Baiji refinery working at 70 percent capacity produced 150,000 barrels per day. Oil experts estimate that Iraqi towns face a 35 percent decline in petrol supplies for several months, with an effect on world prices and domestic stability in the country.

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