20110304 f16 fighter jet israel army 54
An Israeli F-16 fighter jet takes off at the Nevatim air force base near the southern Israeli city of Beersheva on October 06, 2010. - 


Jeremy Hobson: Well we like to buy a lot of our oil from the Middle East. And you know what they like to buy from us? Weapons. By late last year, Persian Gulf nations had ordered more than $120 billion worth. But now some pending weapons deals are drying up.

Our Washington Bureau Chief John Dimsdale reports.

John Dimsdale: Last month, Iraq postponed a deal to buy a billion dollars' worth of F-16 fighters. And the United Arab Emirates is rethinking a $7 billion U.S. missile defense system.

The Lexington Institute's Dan Goure says these countries have other things on their mind.

Dan Goure: What they're more concerned about right now is instability and therefore they're looking for ready sources of cash to now go and either give to the population in the form of bribes or lower food prices. Whatever it's going to take to keep stability.

Both countries say their U.S. deals are still pending. But will they be back?

Guy Anderson: There's a very real chance, we think, that current events will lead Middle Eastern buyers to align themselves more closely with Russia and China.

Guy Anderson is with IHS Janes. He says the Middle East wants to loosen ties with the west. Plus U.S. contractors sometimes link weapons sales to human rights records, whereas Russia and China don't ask questions.

In Washington, I'm John Dimsdale for Marketplace.