A rally to condemn the killings
Libya killings put US in diplomatic Catch-22
Dubai, September 13, 2012
By Una Galani
The US embassy killings in Libya ratchet up the Middle East risk premium. A protest against an amateurish film deemed to insult the Prophet Mohammad has led to the death of the American ambassador in the eastern city of Benghazi, alongside three staff members.
That may dampen Western appetite for intervention elsewhere, and will raise questions about US aid to the wider region.
Since ousting Muammar Gaddafi in 2011, the North African oil producer has made progress. Libya has held its first elections in 50 years, judged by observers to be free and fair enough. The country defied expectations by handing a moderate Islamist coalition a larger share of the vote than more radical rivals.
Despite ongoing tribal clashes, security issues, and confrontations with religious hardliners, oil production is expected to return to pre-war levels next month.
The deadly attack - one day after the anniversary of 9/11 - is a poor return for US support. The Obama administration backed the no-fly zone in Libya, though its approach was less vociferous than some European countries more heavily invested in Libya's oil sector.
Libya's pre-crisis output was equivalent to 2 percent of global production. With oil prices already high, keeping Libyan crude flowing is crucial for the success of America's sanctions against Iran.
An outraged American public could fuel wider ramifications. Unlike Libya, Egypt's new Islamist government depends heavily on international funding.
The attack on the Benghazi consulate coincided with a flag-burning protest at the US embassy in Cairo, and was followed by anti-American protests in Tunisia. That could lead to a fresh examination of the benefits the United States gets for providing aid like the $2 billion-odd paid annually to Egypt.
The Libyan government has condemned the attacks and Egypt has opted for pacifying rhetoric. But radical Islamists elsewhere in the region, including Afghanistan, are now calling for similar embassy attacks.
The tense situation is guaranteed to give President Barack Obama a headache in the run-up to elections. Yet the West has a big stake in supporting the region as it transitions from dictatorships to peaceful democracies, even if it proves a bumpy ride. -
* The author is a Reuters Breakingviews columnist. The opinions expressed are her own.