Mark Wilson | Pool via Bloomberg
U.S. President Donald Trump, speaks with Mohammed bin Salman, the Kingdom of Saudi Arabia’s deputy crown prince and minister of defense, left, in the Oval Office of the White House in Washington, D.C., U.S., on Tuesday, March 14, 2017.
Kamel foresees tradable Saudi assets coming under pressure and new bond issuances assessed with consideration of new risks if the situation worsens and Riyadh fails to provide a convincing defense. Since October 2, the date of Khashoggi’s disappearance, the country’s Tadawul index is down just under 2 percent; year-to-date, however, it’s up nearly 8.5 percent.
Any further impact may depend in part on the U.S. response — which is likely to be minimal, looking at the warm relationship between the Donald Trump administration and Riyadh.
“U.S. action seems unlikely given Saudi remains a lynchpin regional ally and the personal relationship between Trump and MBS (Mohammed bin Salman) is so good,” said Timothy Ash, senior emerging markets strategist at Bluebay Asset Management. “Meanwhile, Trump has not exactly set his stall out as a friend of the media profession.”
The State Department expressed “concern” for Khashoggi’s whereabouts, demanding transparency and saying it is “closely following the case.”
This comes just a few weeks after an open diplomatic spat erupted between Saudi Arabia and Canada, the latter of which had taken to Twitter to criticize Saudi’s imprisonment of female rights activists and demand their release. The kingdom then shocked the world by expelling the Canadian ambassador, withdrawing its Canadian investments and cutting trade ties with the country, telling it to stay out of its affairs.
“Trump, in comments in the Oval Office, told reporters on Wednesday he had raised Khashoggi’s case with Saudi Arabia “at the highest level” and more than once in recent days, according to Reuters.
“We’re demanding everything,” Trump said when asked if he was demanding information from the Saudis. “We want to see what’s going on. It’s a very serious situation for us and for this White House … We want to get to the bottom of it.”
He said he and his wife, Melania, expect to invite Cengiz to the White House soon. “People saw him go in and didn’t see him come out. We’re going to take a very serious look at it. It’s a terrible thing,” Trump said.
“This is a bad situation. We cannot let this happen, to reporters, to anybody. We can’t let this happen.”