... and is undergoing a complex process of changes to its constitution and future power structure. The national projects largely define the quality of life for ordinary Russians, many of whom are experiencing a radical drop in their incomes between the oil crisis and coronavirus quarantines.
In Saudi Arabia, in turn, the ongoing turbulence challenges its implementation of
Vision 2030
and amasses potential for destabilization of the elites —
recent arrests
in the Saudi royal family attest to just that.
This not to mention other oil-supplying ...
... problems in the South, its Ansar Allah opponents (Houthis) have taken the opportunity to put additional pressure on their main adversary, Saudi Arabia. On September 14, with the help of drones and missiles, they delivered a strike against two large oil processing facilities in Saudi Arabia, which forced Riyadh to
cut
oil production by more than half – 5.7 million barrels per day fewer than the usual 9.8 million barrels.
Despite the wave of accusations against Iran following the strikes, there is reason to believe that the ...
... small fraction (5%) of Saudi Aramco’s shares will be listed on capital markets, a fact which might be a sign of further openings — but it is still early to say. Possible new sanctions on Iran and Venezuela’s persistent crisis might further prop up oil prices, but Saudi Arabia has to rely on its own forces, not on more or less favourable international conjunctures.
The third big issue, despite ISIS’ demise, remains that of terrorism. It is now time to think about a post-ISIS world, to ‘win the peace’. Fundamentalism ...
... competitor. It is the Iranian influence that Saudis fear the most, it is the historical enemy of Saudi Arabia, and both countries have waged proxy wars in each of Iraq, Lebanon and Yemen. It is the modern “Cold War” of the Middle-East. One of the reasons Saudi Arabia did not join the Astana initiative is that Iran is a founder. The Saudis does not fear a Russian influence in Syria, but they rather fear an Iranian one. Plus, Russians and Saudis have a lot to discuss and cooperate such as Oil and Gas markets, they have to deal openly at some point. It is in none favour to go into a confrontation in Syria or the Middle-East. As a result, the Saudis had started to view the Russian role in the Middle-East as stability guaranteer. The Saudis ...
... impact of inevitable change. Traditional oil producers are trying to resist progress and the result of these attempts is easy to predict.
REUTERS/Naseem Zeitoon
Russia's Energy Minister Alexander Novak,
Qatar's Energy Minister Mohammad bin Saleh
al-Sada, Saudi Arabia's Oil Minister Ali al-Naimi
and Venezuela's Oil Minister Eulogio del Pino
attend a joint news conference following their
meeting in Doha, Qatar February 16, 2016
Another negative factor affecting Russian-Saudi relations is the two countries’ growing ...
... unexpected signing of the memorandum on the sidelines of the G20 summit?
First off, economic reasons must be noted, since Russia and Saudi Arabia are the largest crude oil producers. Not only does Russia extract immense amounts of oil, but it sells crude oil as well. Saudi Arabia, for its part, is the largest OPEC oil trader.
Both countries suffered losses due to the current oil prices level, realizing that the situation was a result of activities by minor oil producing nations.
Two types of interest underpin the ...
... barriers to any OPEC-Russia or GCC-Russia cooperation on oil production.
First, Russia is perceived to be untrustworthy. (Whether or not it is
actually
untrustworthy is of second-order importance—perceptions are what dictate decisions.) In terms of oil, Saudi Arabia has cited a 1999 episode where it is generally thought that Russia agreed to cut output with OPEC, but ended
up increasing its output
.
Russia’s reputation for saying one thing and doing another is also based on perceptions about its ...
... progress had a number of consequences for the world economy. All attempts to coordinate oil production made by the world energy leaders in recent months were frustrated
by cancelling the clause on fixing production at the January level
. Thus, all oil producers may act at their discretion and, taking into account Saudi Arabia’s refusal to live by the OPEC quotas announced in December 2014, as of today there is not a single, not even an optional, format ensuring the coordination of energy policy among oil producers. By no means does this suggest that a similar ...
... prices before the hypothetical 1968-type oil slump occurs. Since OPEC producers have almost filled their existing storage they are unlikely to keep ramping up production. National budgets of OPEC members are now critically dependent on the price of oil. Saudi Arabia, for example, had to issue first sovereign bond since 2007 to cover the budget deficit caused by cheap oil.
Even though OPEC says it intends to maintain the output ceiling to defend its share of the market and that low oil prices is a short-term ...
Oil prices have recently been gaining some momentum due to a multitude of factors, including the slowing of rig count declines in the US, a possible decline in production as well as Saudi Arabia raising the oil price for Asian customers for a second consecutive month. Questions arise, however, as to where the ongoing crisis in Yemen fits in this equation.
Yemen is a minor-league oil producing country; its oil production peaked at
440 thousand barrels a ...
