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Saudis Plan To Retaliate If They're Hit With Sanctions Over Khashoggi

STEVE INSKEEP, HOST:

Secretary of State Mike Pompeo is on his way to Saudi Arabia. That's according to President Trump. The secretary of state is supposed to address concerns over the alleged killing of a journalist at a Saudi Consulate in Turkey. Now, in an interview with "60 Minutes" over the weekend, the president raised the possibility of severe punishment of Saudi Arabia, but only if they're found to be guilty. And the president emphasized how much the United States would have to lose.

(SOUNDBITE OF TV SHOW, "60 MINUTES")

PRESIDENT DONALD TRUMP: They are ordering military equipment. Everybody in the world wanted that order. Russia wanted it. China wanted it. We wanted it. We got it.

LESLEY STAHL: So would you cut that off, curtail it?

TRUMP: Do I - well, I'll tell you what I don't want to do. Boeing, Lockheed, Raytheon, all these - I don't want to hurt jobs. I don't want to lose an order like that. There are other ways of...

STAHL: Punishing...

TRUMP: ...Punishing, to use a word that's a pretty harsh word. But it's true.

INSKEEP: But even the president's vague talk of possible punishment if he's convinced the Saudis killed journalist Jamal Khashoggi prompted Saudi threats of retaliation. Vivian Nereim is a reporter for Bloomberg News, and she joins us from the capital, Riyadh. Welcome to the program.

VIVIAN NEREIM: Thank you.

INSKEEP: What threats have the Saudis made in response?

NEREIM: Well, the Saudi government issued quite a strong but also vague statement last night that essentially threatened, you know, that they would respond to any measure against them with an even stronger measure. Now, they kept that a bit cryptic as to what that means. But obviously the first place that a lot of analysts went was sort of a guess that that could mean using their power as the world's largest oil exporter. So Saudi Arabia obviously controls a large share of the oil market. And there was actually a article written by a Saudi journalist who's quite...

INSKEEP: Yeah.

NEREIM: ...Prominent in one of the state-controlled media outlets, Al Arabiya. And he suggested that, you know, if the U.S. isn't careful Saudi could, you know, bring oil prices over a hundred dollars or over $200. And he even went on to suggest that this could push Saudi Arabia into the arms of Iran, you know, which has been their traditional regional rival. At the same time, Saudi officials later said that that didn't reflect their official thinking.

INSKEEP: OK.

NEREIM: So it's not been clear what they're actually, you know, threatening, only that they felt they had to respond very strongly to the statement from President Trump.

INSKEEP: I'm curious about that because the president is - the president the United States is talking about the Saudis, it seems at this point, about the same way that he talks about Russia's obvious interference in the U.S. election. The president keeps saying, well, it's serious if it happened, but we'll see. And they deny it. Why would the Saudis feel at all threatened by that?

NEREIM: Well, this has been a huge shift for them. And it's not just about how President Trump is reacting to it. There's been a really strong reaction in Washington against this. People have been cutting ties - business ties, very important business ties - with Saudi Arabia. There's a massive investment conference that's going to be happening later this month. And several really important names have pulled out of it - Jamie Dimon from JP Morgan very recently. Richard Branson has pulled out and also pulled out of another investment that he had been doing with the Saudis.

So there's been a really strong reaction especially from tech companies and from all of these companies that have really had close ties to Saudi Arabia under the young - you know, Saudi Crown Prince Mohammed bin Salman. So this could have a really strong economic effect on them. You know, they're really quite eager to have foreign investment right now and to sort of build up their economy and as part of their economic transformation. And it's having quite an effect here. You know, we saw the local stock market, you know...

INSKEEP: Plunge.

NEREIM: ...Really dive yesterday. Yeah.

INSKEEP: Well, let's talk about that because the Saudis have wanted to have this narrative of economic opening and reform. And alongside that, they've wanted to have the appearance of greater openness. It's still going to be an absolute monarchy. It's still going to have certain controls. But they wanted women to be driving and wanted to appear to be a little more in line with the way that people have freedom in other countries. Is the royal family no longer thinking that way?

NEREIM: Well, to be honest, I think that that assessment was perhaps one that was coming out of the U.S. over, you know, the past year. But it's not necessarily accurate. You know, Crown Prince Mohammed bin Salman in his own words never called himself a reformer. What he does want is economic openness. And he is talking about loosening social restrictions.

What he's never talked about is loosening political restrictions or, you know, offering any kind of - you know, more free speech or more political openness. And so there has been a crackdown simultaneously on the people who have been critical of the kingdom. And some Saudis who are abroad and critical of the kingdom see this as in line with that.

INSKEEP: And of course this killing, this alleged killing, would be in line with that as well. Vivian Neriem of Bloomberg, thanks so much - really appreciate it.

NEREIM: Thank you.

INSKEEP: She's in Riyadh, Saudi Arabia. Transcript provided by NPR, Copyright NPR.