[London / Dubai 30th Reuters]–The OPEC Plus, which is made by the Organization of Petroleum Exporting Countries (OPEC) and non-member oil producing countries such as Russia, decided to increase production at the meeting on June 2, and the “shadow” by Saudi Arabia. There was a diplomatic effort. Saudi Arabia, which had been trying to increase production at the request of the United States, was actively working to secure the consent of Russia. Two people familiar with the circumstances of the talks told Reuters.
These Saudi moves show that the country is under pressure to steer hard, seeking to improve relations with the United States and not breaking its long-established cooperation with Russia over its oil policy.
“It seems that there was no problem in the end because the United States insisted, and then Saudi Arabia needed to confirm Russia’s intentions,” said one of the people concerned about the increase in OPEC Plus production. A second source also told Reuters that Saudi Arabia had carefully consulted Russia, which had been severely sanctioned by the West following the invasion of Ukraine.
US President Joe Biden will travel to the Middle East on July 13-16 and will visit Saudi Arabia for the first time since taking office. Mr. Biden has been poked by the ruling Democratic Party and is urged to ask Saudi Arabia to exclude Russia from OPEC Plus.
But for Saudi Arabia, the years of efforts it has made to bring Russia into the production agreement are blistered. OPEC Plus was launched in 2016, but Saudi Arabia has been working with Russia long before that.
“It’s very important to stay in Russia,” one OPEC Plus representative told Reuters. Experts also said that Saudi Arabia has no political reason and wants Russia to remain OPEC Plus in the sense of purely increasing its influence on the oil market.
A person familiar with Russia’s ideas pointed out that being a member of OPEC Plus at a time when Europe and the United States wished for Russia’s isolation had a positive effect on Russia. “In the current environment, Saudi Arabia enjoys high oil prices and Russia needs solid support from OPEC Plus. Market collapse does not benefit anyone,” he added.
Biden is expected to meet with de facto political leader, Crown Prince Muhammad, during his visit to Saudi Arabia. There was a dispute between Mr. Biden and Crown Prince Muhammad over the Yemeni Civil War and the murder of a Saudi dissident reporter.
Meanwhile, Crown Prince Muhammad and President Putin have a “closer” relationship, according to a former Russian official.
Energy Minister Abdul Aziz of Saudi Arabia said at an international economic forum held in Russia in June that the relationship between Russia and Saudi Arabia is “as good as the weather in Riyadh.” Russia’s Energy Minister Novak also emphasized that Russia can work with OPEC Plus beyond 2022.
Saudi Arabia and Russia have officially collaborated on a production agreement since the inauguration of OPEC Plus in 2016, but the movement to incorporate Russia into the OPEC side began in 2001.
OPEC Plus plans to completely rewind the production cuts agreed in 2020 by August this year. However, Russia’s production volume continues to decline due to sanctions in Europe and the United States, raising questions about what will happen to the cooperation system as OPEC Plus in the future.
Another Russian official believes that the “dynamics” within OPEC Plus are unlikely to change before the November US parliamentary midterm elections.
Gary Ross, a long-time OPEC expert, asserts that “Saudi Arabia, which has been working to bring Russia into the management of the oil market for more than 20 years, is not trying to break this important relationship.” did.
(Reporters by Alex Lawler and Maha El Dahan)
