Saudi energy minister says agreements with Russian Federation helped oil markets to stabilise

Katrina Barker
October 6, 2017

He described the visit of the Custodian of the Two Holy Mosques - the first visit of a Saudi king to Russian Federation - as a historic event, stressing that it would contribute to the development of relations between the two countries in various fields.

The talks took place against a hard political backdrop.

According to Novak, for the first time a substantial delegation from Saudi Arabia, including about 200 representatives and 85 CEOs of large companies has come to Russian Federation. The landmark meeting is to take place on October 5 in the Kremlin Palace.

The Saudi monarch's decision to visit Russian Federation, now of all times, marks a new shift in Riyadh's foreign policy, Vyacheslav Smirnov, director of the Scientific and Research Institute for Political Sociology, told Radio Sputnik.

Saudi Arabia is a close USA ally and does not have a history of warm relations with Russian Federation.

It shows the Saudis' interest in keeping Russian Federation signed up to a global deal to limit oil production and push up the price of their valuable crude exports. The work on the agreement opened new opportunities for Russian Federation and Saudi Arabia in the field of economic cooperation.

Relations between the two countries have reached a "fundamentally new level recently", Novak said.

Al-Falih noted that Aramco's IPO will be used as a catalyst for the opening up of the Saudi economy. According to the Ministry of Economic Development, the volume of trade between the two countries has increased by 30% in the first half of 2017 compared to the same period previous year, having amounted to $430 million.

"We have a vast potential for developing cooperation in nuclear power".

A joint investment forum will be held in the framework of the visit of the Saudi King Salman to Moscow.

These agreements are "expected to play a pivotal role in the growth and development of the military and military systems industry in Saudi Arabia", Saudi Arabian Military Industries (SAMI) said.

Defense was another topic. However, no contracts have been signed yet.

Now, $1bn (energy deal) is like a drop in water for a country having over $50bn in budget deficit and borrowing billions more, locally and internationally.

The S-400, touted as being able to hit targets at a distance of 400 kilometres, is the most advanced offer from Russian Federation. The parties discussed packages of agreements worth up to $20 billion, but no solid contracts were signed. Signatories to the document were Alexander Dyukov, CEO of Gazprom Neft, and Amin H. Nasser, President and CEO, Saudi Aramco.

"We have seen a steady reduction in inventories". And Russia is close to Iran, a fierce adversary of Saudi Arabia despite their status as OPEC members.

Putin admitted that he once met United States President Donald Trump, but said he has no personal ties with the US leader. "Do you feel that USA allies are sort of moving away from the United States of America and going elsewhere, maybe forming new alliances?" a journalist asked.

"I haven't decided whether I'm going to run at all". We don't know. Who knows what they have there and where.

"Whether we will extend these agreements or not will depend on the situation in the world market", he said.

Russian Federation and Saudi Arabia have helped stabilize crude prices, the minister stated.

Expanding on this, Ahmad continued: "In the past, Saudi Arabia has expressed a commitment to increased production cuts to bolster the market".

Saudi Aramco is the national oil company of Saudi Arabia, 100-percent controlled by the Government of Saudi Arabia. "Previously, the primary focus of [Riyadh's] foreign policy was the [Middle Eastern] region and the United States".

Other reports by AllAboutTopnews

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