Russia is one of the pillars of stability of the world oil market. It played an important role in maintaining a fair price for a barrel of oil and honestly cooperated with Saudi Arabia’s OPEC agreement +. What has changed today?
Small countries-exporters of oil did not adhere to agreed quotas, unlike Saudi Arabia and Russia, which, thanks to the agreement has maintained stability in the oil market and maintain prices at a certain level.
the Agreement OPEC+ stayed exactly as long until the US came in first place in the list of the largest importers of the black gold began to produce its own oil and export the surplus to other countries.
the shale oil prospered, so American companies have borrowed large sums to invest in the shale industry, which is still preserved competitive prices.
Russia took advantage of the situation and rejected the agreement OPEC+. She attempted to destroy the shale oil industry in the United States to force the American President to face the wrath of supporters in retaliation for sanctions imposed on the Russian oil and gas sector. In addition, she is trying to force us leader to enter into direct confrontation with the oil companies that are its key supporters.
the Sudden decision of the Russian side, embarrass the U.S. President, who for the first time in a long time do not know what to do next!
Oil has fallen sharply in price, but the political cost would be disproportionately higher.
the Russian had expected that Saudi Arabia will turn a blind eye to exit from the transaction, but the opposite happened: the state oil company of Saudi Arabia Saudi Aramco announced that it has received instructions from the Ministry of energy to promote sustainable productionrodstvennye power with 12 to 13 million barrels of oil per day.
Saudi Arabia has been engaged in a standoff for two reasons:
the Context
Defence 24: oil and gas, Russia has lost, but she has a chance to cancel санкцийDefence2424.03.2020 Le Point: the Alliance of Saudi Arabia and Russia неизбеженLe Point24.03.2020 Polskie Radio: coronavirus only helps ПутинуPolskie Radio24.03.2020 Bloomberg: the coming decline and fall of the oil Empire Persian заливаBloomberg23.03.2020 Nettavisen: three reasons for the fall in oil prices is threatening to plunge the world into коллапсNettavisen23.03.2020 first, it should be emphasized that the low cost of oil production in Saudi Arabia allows manufacturers to be in the black even with such a sharp drop in prices.
second, Saudi Arabia is a key player on the world oil market, and if it will no longer control the oil market, the world economy will collapse.
What happened, really? Pandemic coronavirus brought down world stock markets and oil war has exacerbated the situation. The response of Saudi Arabia got the Russians to step back. Thus, it is likely that they can change their position in the coming days.
as for the West, he confirmed that Saudi Arabia is the number one player in the world market of hydrocarbons.
Summing up the above, it should be noted that Saudi Arabia has not left the Russian open door no to negotiations, no to return to the agreement nor for anything else, so it seems that the Saudi policy toward Russia will develop in a given direction.
the new York times contain estimates exclusively foreign media and do not reflect the views of the editorial Board of the new York times.
