A New US Middle Eastern Policy? Update II: 2025.06.11
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In this roundup, we again take a closer look at the latest developments in the Middle East, in particular the indications changes are afoot when it comes to US policy.
After purging policy-making circles from Israeli influences last week, over the weekend US President Trump for the first time organized a sit down of his administration’s leading people when it comes to Gaza and Iran, at Camp David, to discuss policy and plans.
In a phone call after the meeting, Trump apparently told Israeli prime minister Netanyahu that he still wants to achieve a deal with Iran, and avoid an armed conflict. Which is the opposite of what Netanyahu wants to hear.
Thereafter, the US Ambassador to Israel, Mike Huckabee, came out with a statement saying the US no longer support the two-state solution for Palestine. In EPM’s view, this could actually mean multiple things, so don’t jump to conclusions just yet!
Huckabee’s statement could be a reflection of what was discussed at Camp David. But we do not rule out that Huckabee was nudged by his friends in Israel to speak out in a way that contradicts the plan agreed at Camp David; or, if a plan was not yet agreed, to support the proposal that is most favoured by Israel.
Whatever it may be, to us at EPM it all indicates clear that changes are indeed afoot.
Furthermore, we look at:
The Shell plan for LNG until 2030
The OPEC long term outlook for crude oil demand
The updated World Bank outlook for the global economy this year, which sees 2025 growth significantly below its earlier January 2025 outlook due to the Trump Tariff War
The US–China trade talks in London, which appear to have been concluded with an agreement to continue talking, i.e. no breakthrough deal
The UN conclusion that Israel is committing the crime against humanity of "extermination" in Palestine, as part of a "concerted campaign to obliterate Palestinian life"
The Israeli navy’s attack on the port of Hodeidah in Yemen; where EPM notes that the Israeli justifications for this attack display hypocrisy, and thus will further erode soft power of the US–Israel Alliance
Iran’s threat to the US–Israel Alliance that it can in a "precisely proportional" way on Israel’s nuclear facilities, if the Alliance were to attack Iran’s nuclear facilities; where EPM explains why this is connected to the nuclear deal negotiations, and what Iran is trying to achieve with this
The third UN Ocean Conference, which is taking place in Nice, France
General Energy
Shell plans to add up to 12 million metric tons of additional liquefied natural gas capacity between now and the end of the decade from projects under construction, writes Reuters. The projects included one in Canada, two in Qatar, and others in Nigeria and the UAE. Earlier this year Shell said global LNG demand is estimated to rise by around 60% by 2040, driven largely by economic growth in Asia, the impact of artificial intelligence, and efforts to cut emissions in heavy industries and transportation.
Longer term, OPEC expects a 24% increase in the world's energy needs between now and 2050, with oil demand surpassing 120 million barrels per day over that time period, writes Reuters. "There is no peak in oil demand on the horizon," OPEC Secretary General Haitham Al Ghais said, speaking at the Global Energy Show in Calgary, Canada.
Macroeconomics & Technology
The World Bank has slashed its forecast for economic growth this year, writes the Associated Press. Citing “a substantial rise in trade barriers”, it now expects the world economy to expand just 2.3% in 2025, down from 2.8% in 2024. The US economy will grow half as fast (1.4%) this year as it did in 2024 (2.8%). That marked a downgrade from the 2.3% US growth it had forecast back for 2025 back in January. The Chinese economy is forecast to see growth slow from 5% in 2024 to 4.5% this year and 4% next. The World Bank expects the 20 European countries that share the euro currency to collectively grow just 0.7% this year, down from an already lackluster 0.9% in 2024. India is once again expected to the be world’s fastest-growing major economy, expanding at a 6.3% clip this year. But that’s down from 6.5% in 2024 and from the 6.7% the bank had forecast for 2025 in January. In Japan, economic growth is expected to accelerate this year–but only from 0.2% in 2024 to a sluggish 0.7% this year, well short of the 1.2% the World Bank had forecast in January.
Meanwhile, on Tuesday the US and China completed 2 days of trade talks in London. The negotiators “agreed on a framework to move forward on trade talks”, the Associated Press writes. But few details were made available, which leaves open the question whether the agreement includes anything around a real reduction in tariffs (or just a plan to continue talking). According to some analysts, the agreement to start talking again includes an easing of Chinese restrictions on the export of rare earths to the U.S., and the export of U.S.-produced chips to China, writes Reuters. But everything is only temporarily agreed, Reuters adds.
Geopolitics
As to Gaza, Palestinians desperately trying to access aid in Gaza came under fire again Tuesday, killing 36 people and wounding 207, writes the Associated Press. At least 163 people have by now been killed and 1,495 wounded in a number of shootings near aid sites run by the US–Israel Alliance’s Gaza Humanitarian Foundation (GHF).
Meanwhile, the United Nations Independent International Commission of Inquiry on the Occupied Palestinian Territory on Tuesday released a report into Israel’s conduct, and concluded that Israel committed the crime against humanity of "extermination" by killing civilians sheltering in schools and religious sites in Gaza, part of a "concerted campaign to obliterate Palestinian life”, writes Reuters. The commission said Israel had destroyed more than 90% of school and university buildings and more than half of all religious and cultural sites in Gaza. Navi Pillay, former U.N. High Commissioner for Human Rights , who chairs the commission, said in a statement:
We are seeing more and more indications that Israel is carrying out a concerted campaign to obliterate Palestinian life in Gaza. Israel's targeting of the educational, cultural and religious life of the Palestinian people will harm the present generations and generations to come, hindering their right to self-determination.
Harm done to the Palestinian education system was not confined to Gaza, the report found, citing increased Israeli military operations in the West Bank and East Jerusalem as well as harassment of students and settler attacks there.
As to prove the UN correct, Israeli soldiers shot dead a Palestinian man after he approached them with his hands in the air during a raid in the old quarter of Nablus in the occupied West Bank on Tuesday, writes The National (which also carries video of the event). Once close, the man appears to talk to the soldiers, arms still raised, before a series of shots ring out. Subsequent photos show the man lying on the ground, a red stain on his shirt.
In the background, the US no longer wholeheartedly endorses an independent state for Palestinians, Mike Huckabee, Washington’s Ambassador to Israel said, adding that if one were to be formed it could be elsewhere in the region rather than the West Bank, writes Bloomberg. Regarding location, Huckabee suggested a piece of land could be carved out of a Muslim country rather than asking Israel to make room. “Does it have to be in Judea and Samaria?” Huckabee, 69, said, using the biblical name the Israeli government favors for the West Bank, where some 3 million Palestinians live under occupation. EPM notes that these comments are quite ironic, since, of course, the Palestinians have been forced to first make room for the establishment of the State of Israel, and since then for a continuous enlargement of this state. Wouldn’t that lead to the logical conclusion that rationally and morally, yes, exactly Israel should make room for a Palestinian state?
Notably, Huckabee’s comments came after US president organized a face-to-face meeting between his main Gaza and Iran policy advisors over the weekend, writes Axios, which notes it was the first time Trump got his team together to discuss the subjects. The meeting at Camp David on Sunday was attended by Trump, Vice President Vance, Secretary of State Marco Rubio, Secretary of Defense Pete Hegseth, chief of staff Susie Wiles, special envoy Steve Witkoff, CIA director John Ratcliffe and other senior officials. A senior US official told Axios the president sees both crises as intertwined and part of a broader regional reality he is trying to shape.
EPM notes that this meeting came after the news last week that Trump is shaking up the policy-making circles to reduce Israeli influence (which EPM reported on here). We are not surprised, then, that during a call with Israeli prime minister Netanyahu on Monday Trump insisted he wants to achieve a deal with Iran, and avoid a military confrontation, writes again Axios. Among the options we see, therefore, are that Huckabee’s statements are reflections of what was discussed at Camp David. But we do not rule out either that Huckabee was nudged by his friends in Israel to speak out in a way to contradicts the plan agreed at Camp David; or; if a plan was not yet agreed, to support the proposal that is most favoured by Israel. Whatever it may be, to us at EPM it appears clear that changes are indeed afoot.
As to Yemen, the Israeli navy attacked docks in Yemen’s Houthi rebel-held port city of Hodeidah on Tuesday, writes The National. It was the first time the Israeli navy has been involved in attacks against the Iran-backed Houthis. Hodeidah has been the main entry point for food and other humanitarian aid since Yemen's civil war began in 2014, when the Houthis seized the capital Sanaa. Israel says its attack was justified as it claims the pot is used for weapons transfers. Israeli Defence Minister Israel Katz threatened the Houthis with a naval and air blockade if their attacks continue. EPM notes this is somewhat ironic as well, as the reason why the US–Israel Alliance starting fighting with the Houthi’s was the latter’s attempt to blockade Israel in response to the Israeli War on Gaza. If that was considered an “affront” by the US–Israel Alliance, then shouldn’t it see a blockade of Yemen for political purposes similarly? No doubt, we at EPM say, the world will notice this hypocrisy, and this will further erode the soft power of the US–Israel Alliance. We repeat our conviction that in the long run the US will come to regret this, as history shows that a nation cannot preserve hegemon through military and economic means alone.
As to Iran, its Supreme National Security Council said in a statement that if Israel were to attack Iran’s nuclear facilities, it could strike back in a precisely targeted manner thanks to the secret intelligence that Iran says it stole from Israel, writes The National. In the background, the US and Iran are discussing when to resume negotiations on a nuclear deal. The EPM assessment is that ran is working to undermine attempts by the US–Israel Alliance to establish leverage over Iran in these negotiations, to leave the Alliance with no option but to accept a degree of Iranian nuclear enrichment.
Climate Politics
The third U.N. Ocean Conference opened Monday in Nice, France. The Associated Press writes that ratification of the High Seas Treaty tops the agenda. Adopted in 2023, the treaty would for the first time allow nations to establish marine protected areas in international waters, which cover nearly two-thirds of the ocean and are largely ungoverned. The treaty will come into force once 60 countries ratify it. As of Monday, at least 49 countries had. South Korea, France and the European Union have championed the treaty, but most large ocean nations have yet to ratify it, including the rest of the G20.