Moscow: This is Russian President Vladimir Putin’s second visit to Saudi Arabia’s Deputy Crown Prince Mohammed bin Salman in the past eight months. Even though the primarily aim of the meet held at the Russian capital, Moscow was fuel sector cooperation and a crucial agreement, it also shows signs of attempts to improve bilateral ties between both countries. Only a few days ago, US President Donald Trump visited Saudi Arabia in his first foreign tour and signed agreements worth billions of dollars. Under such circumstances, Saudi Arabia’s Deputy Crown Prince Mohammed bin Salman’s visit to Russia proves crucial.
Last year, Russian President Vladimir Putin had taken the initiative for the oil production cuts deal. The agreement which was made with Saudi Arabia’s cooperation, was to come into force form January 2017. Most of the countries that were a part of this agreement, claimed to have complied with the agreement. However, no major impact of this agreement has been visible on the oil markets. Due to the crude oil prices hiking up to 50 dollars per barrel for a certain period of time, fuel producing countries found relief. However, the following slide in its prices was a cause for concern.
On the grounds of the decline in crude oil prices, Russia and Saudi Arabia, leading nations in the oil markets, once again seemed to have given a boost to increasing the extensiveness of the agreement. A few days ago, Saudi Energy Minister Khalid al-Falih had also made a critical warning regarding crude oil prices. The Saudi official said that with lead from crude oil producing nations, it was aimed to bring the oil reserve levels to where they were five years ago and come what may the target will be achieved by putting in utmost efforts.
Subsequently, both the nations have reported of becoming unanimous by making the following statements. Russia and Saudi Arabia will try their best to get the international oil reserves to the average levels they were at 5 years ago. They will make attempts to gain support from other countries that are not part of the existing agreement. They have also agreed to increase the deadline for the oil production cuts deal as it is essential.
Increasing the extent of the oil production cuts deal may have far reaching effects on the crude oil markets. Currently, the increase in the supply of crude oil in the fuel markets, is mainly due to the fact that the production of ‘Shell Oil’ in US has surpassed expected levels. Due to the decisions taken by US President Donald Trump, there have been signs of increase in the production of crude oil in the US.
Under such circumstances, Saudi Prince Mohammed bin Salman’s visit to Russia along with the petroleum minister, has drawn attention to itself. Sources have informed that Prince Salman and the Russian President had discussed cooperative agreements on the energy sector and other areas apart from the oil agreement during their talks. Also, these talks included the Syrian struggle, informed Russian sources.