Russia forced the Saudis to capitulate in the "oil war"

Professor economics ESCP European Business School Memduh Salameh said that Riyadh can not continue the "oil war" with Moscow, since 90% of the budget of Saudi Arabia is income from the sale of this raw material. This was reported by the Turkish publication Anadolu, which decided to study the opinions of the expert community regarding the "oil war" between Moscow and Riyadh.

Saudi Arabia admitted that it lost the “oil war” against Russia by convening OPEC + for an emergency meeting under pressure from US President Donald Trump

- the expert is sure.

Salameh believes that because of the COVID-19 pandemic, global oil demand fell by 20 million barrels per day. At the same time, the Russian economy can be content with oil prices at $ 25 per barrel, while Saudi Arabia needs oil prices between $ 85 and $ 91 per barrel to balance its budget. According to the expert, the cost of oil for Saudi Aramco is $ 28 per barrel, while oil production for Russian companies is cheaper by $ 2,5 per barrel.

The expert is convinced that no matter how much oil production is reduced, this will not have a positive impact on its price while the pandemic continues. Oil prices will continue the downtrend. At the same time, Moscow and Riyadh can not reduce production by more than 10 million barrels. The main reason for the imbalances, he called the reckless overproduction of oil from the United States.

In turn, according to the head of the Russian National Energy Security Fund Konstantin Simonov, neither Russia nor Saudi Arabia could predict the rate of decline in oil prices.

Moscow was ready for a scenario in which the price of oil was at least $ 30 per barrel as an effect of terminating the OPEC + agreement, but prices below $ 30 were the result of an unpredictable outbreak of COVID-19. That's why I think that current oil prices are a surprise to the Russian government, and the same goes for Saudi Arabia.

- considers Simonov.

According to Simonov, Saudi Arabia launched a price war against Russia, refusing to cooperate. But now in Riyadh they are thinking about how to change this situation. He is convinced that the best-case scenario for Moscow and Riyadh is to return to the negotiating table. After all, an aggressive price policy Saudi Arabia may eventually turn against it.
  • Used photos:
Dear reader, to leave comments on the publication, you must sign in.
  1. steelmaker Offline steelmaker
    steelmaker April 9 2020 12: 21
    News ABOUT ANYTHING! There are no facts, only the author's Wishlist. But the title of the article is "like a balm for the soul" TO FANS of Putin.
    1. Fans are not the right word. Rather, slaves.
    2. The comment was deleted.
    3. The comment was deleted.
    4. Axiomatic Offline Axiomatic
      Axiomatic (Yuga Axiomatic) April 9 2020 23: 03
      That's right, Steelworker !! Having disrupted the negotiations on March 6 and not joining the deal, the Russian authorities thereby made it legal to increase production from the OPEC and CA countries! And therefore, in the end, they were forced to recognize it as legitimate to count from current production levels. That is, they themselves and their people were robbed of their intrigues, and did not achieve what they wanted, drawing the United States into a deal. Trump simply shrugged off Putin as if he were an annoying fly, with which Putin simply agreed in the end. As a result, despite the fact that the cost of production in the Russian Federation is higher and the reduction is much more expensive than in SA, the Russian Federation was forced to reduce production compared to March levels even more than SA - most likely 2 against 1,5 million barrels per day. Under such circumstances, there can be no question of victory. This is pure defeat of the Russian Federation in the struggle for the European market.
  2. Arkharov Offline Arkharov
    Arkharov (Grigory Arkharov) April 9 2020 13: 37
    All Runet in this "visiting professor". Yes, it’s probably a success, if he says so. Only for some reason, I could not find anyone else with such an opinion. Probably, I was looking badly, or did no one dare to give similar interviews to Sputnik agency anymore?
  3. Sergey Latyshev Offline Sergey Latyshev
    Sergey Latyshev (Serge) April 9 2020 13: 56
    Hooray! Helped !!!
    Although such experts are a dime a dozen. There were no prices for 80 bucks since the age of 14, the Saudis allegedly do not understand oil production, since they planned such a price?

    Complete rethinking!
  4. Xuli (o) Tebenado April 9 2020 18: 41
    The subjective opinion of some Salameh is presented as absolute truth in the last resort.
  5. The comment was deleted.
  6. Heroes Heroes Offline Heroes Heroes
    Heroes Heroes (Sergei) April 10 2020 15: 19
    What is the news about? Whoever writes what, in the pope everything! And the Saudis, and we, and the Americans! And the rest is not sweeter.
  7. Rus Offline Rus
    Rus April 10 2020 20: 34
    Another geopolitical victory)))) The United States was soaked, and now the Arabs). Glory to the great president! Glory! Let’s drink with a throat for the president of Russia!
  8. Alex fe Offline Alex fe
    Alex fe (Alex Fe) April 10 2020 22: 07
    The title is false, schizophrenic and shameful.