How Saudi Arabia And Russia Came Closer Because Of Oil
Prince Abdulaziz bin Salman has become the new energy minister of Saudi Arabia.
2. About Read_ interesting facts about Saudi Arabia
🔸Mohammed bin Salman Abdulaziz, the half-brother of the Crown Prince, has played a leading role in many negotiations in the Organization of Petroleum Exporting Countries (OPEC).
🔸 In his first public speech, the Energy Minister said that he will pursue this policy after agreeing on 'OPEC Plus' on reducing oil production. 'OPEC Plus' is actually an alliance between the Organization of Oil Producing Countries and Russia and other countries.
🔸Abdul Aziz, while addressing an energy conference in Abu Dhabi, said on Monday, "Now we have a new family, 'OPEC Plus'."
🔸He said will soon celebrate this alliance, which will keep us united in the thread of unity, till death."
He clearly said that the alliance with Russian President Vladimir Putin will last for a long time.
🔸 In fact, Abdul Aziz was part of the team that was involved in finalizing the agreement with Russia to cut oil production by the end of 2016, so that oil prices would increase. This deadline has now been extended till March 2020.
🔸 Recently, crude oil prices have stabilized at US $ 60 per barrel of Brent. This price is much lower than the expectations of Saudi Arabia and Russia.
🔸 Experts tracking oil production say that both countries want to increase this price by US $ 20 to achieve their economic goal.
Will China and India come together to rein in OPEC?
Qatar's 'divorce' from OPEC and Saudi Arabia
Oil going relationship
"Russia has become the main ally of Saudi Arabia," says Randolph Bell, director of the Global Energy Center for Atlantic Council in Washington.
He says after the dramatic fall in oil prices in 2014 and 2016, the 'OPEC Plus' agreement is related to the demand for an increase in oil prices in recent years."
According to Bell, the roots of the relationship between the governments of Saudi Arabia and Putin go deeper than oil cooperation."
"Saudi Arabia has invested close to 2.5 billion dollars in projects in Russia."
However, Abdulaziz will face a tough challenge to increase crude oil prices.
This task is not very easy, given that America has increased its oil production in the last five years.
And now, due to the trade war between the US and China, the global economic growth rate as well as the demand for oil has been threatened.
Experts say that it is possible that next year this organization of oil producing countries will announce new targets for oil cuts.
According to Tom Seng, director of the School of Energy, Political and Trade Economics at the University of Tulsa, USA, "Neither Russia nor Saudi Arabia can achieve their budget spending targets at current rates."
Putin's ambition
Seng says, "Since this is now a voluntary agreement, OPEC is looking to strengthen its relations with Russia."
Because Moscow can withdraw from this alliance at any time.
OPEC's three largest oil producing countries - Saudi Arabia, Iraq and the United Arab Emirates, have always shown interest in a policy of cutting oil production to allow prices to rise.
But Russia's stance is not clear, while its role in negotiations is steadily increasing.
According to analysts, Putin's interest lies in the larger ambition to increase his country's role in geopolitics of the Middle East, beyond commercial interests.
The United States has emerged as a major oil producing country because of shale oil.
By using a new technology called 'fracking', the United States has become the world's leading oil producer in 2018 itself, although this technique is under attack from environmentalists.
Oil prices fall due to 'non-OPEC countries'
What is going to end saudi's oil dominance
Power to determine price
Experts say that in this way OPEC's intention is not being successful due to adequate supply of crude oil from the US.
OPEC was formed in Baghdad in the year 1960 and since then this organization had immense power and ability to intervene in deciding the prices of crude oil.
Currently OPEC comprises 15 countries, seven countries from the Middle East, six from Africa and two Latin American countries (Venezuela and Ecuador).
According to the agency's official data, all these countries together control 44 percent of the world's oil supply and 82 percent of its reserves.
OPEC's partner countries are Russia, Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Republic of Sudan and Republic of South Sudan.
OPEC hopes that in 'OPEC Plus', together with these countries, it will once again be in a position to play a decisive role in deciding the price of oil.
🔸 In his first public speech, the Energy Minister said that he will pursue this policy after agreeing on 'OPEC Plus' on reducing oil production. 'OPEC Plus' is actually an alliance between the Organization of Oil Producing Countries and Russia and other countries.
🔸Abdul Aziz, while addressing an energy conference in Abu Dhabi, said on Monday, "Now we have a new family, 'OPEC Plus'."
🔸He said will soon celebrate this alliance, which will keep us united in the thread of unity, till death."
He clearly said that the alliance with Russian President Vladimir Putin will last for a long time.
🔸 In fact, Abdul Aziz was part of the team that was involved in finalizing the agreement with Russia to cut oil production by the end of 2016, so that oil prices would increase. This deadline has now been extended till March 2020.
🔸 Recently, crude oil prices have stabilized at US $ 60 per barrel of Brent. This price is much lower than the expectations of Saudi Arabia and Russia.
🔸 Experts tracking oil production say that both countries want to increase this price by US $ 20 to achieve their economic goal.
Will China and India come together to rein in OPEC?
Qatar's 'divorce' from OPEC and Saudi Arabia
Oil going relationship
"Russia has become the main ally of Saudi Arabia," says Randolph Bell, director of the Global Energy Center for Atlantic Council in Washington.
He says after the dramatic fall in oil prices in 2014 and 2016, the 'OPEC Plus' agreement is related to the demand for an increase in oil prices in recent years."
According to Bell, the roots of the relationship between the governments of Saudi Arabia and Putin go deeper than oil cooperation."
"Saudi Arabia has invested close to 2.5 billion dollars in projects in Russia."
However, Abdulaziz will face a tough challenge to increase crude oil prices.
This task is not very easy, given that America has increased its oil production in the last five years.
And now, due to the trade war between the US and China, the global economic growth rate as well as the demand for oil has been threatened.
Experts say that it is possible that next year this organization of oil producing countries will announce new targets for oil cuts.
According to Tom Seng, director of the School of Energy, Political and Trade Economics at the University of Tulsa, USA, "Neither Russia nor Saudi Arabia can achieve their budget spending targets at current rates."
Putin's ambition
Seng says, "Since this is now a voluntary agreement, OPEC is looking to strengthen its relations with Russia."
Because Moscow can withdraw from this alliance at any time.
OPEC's three largest oil producing countries - Saudi Arabia, Iraq and the United Arab Emirates, have always shown interest in a policy of cutting oil production to allow prices to rise.
But Russia's stance is not clear, while its role in negotiations is steadily increasing.
According to analysts, Putin's interest lies in the larger ambition to increase his country's role in geopolitics of the Middle East, beyond commercial interests.
The United States has emerged as a major oil producing country because of shale oil.
By using a new technology called 'fracking', the United States has become the world's leading oil producer in 2018 itself, although this technique is under attack from environmentalists.
Oil prices fall due to 'non-OPEC countries'
What is going to end saudi's oil dominance
Power to determine price
Experts say that in this way OPEC's intention is not being successful due to adequate supply of crude oil from the US.
OPEC was formed in Baghdad in the year 1960 and since then this organization had immense power and ability to intervene in deciding the prices of crude oil.
Currently OPEC comprises 15 countries, seven countries from the Middle East, six from Africa and two Latin American countries (Venezuela and Ecuador).
According to the agency's official data, all these countries together control 44 percent of the world's oil supply and 82 percent of its reserves.
OPEC's partner countries are Russia, Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Republic of Sudan and Republic of South Sudan.
OPEC hopes that in 'OPEC Plus', together with these countries, it will once again be in a position to play a decisive role in deciding the price of oil.
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