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News ID: 45838
Asia » Asia
Publish Date: 16:09 - 24 April 2020
Tehran 24 April _A telephone call last month between Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman degenerated into a shouting match just before Riyadh decided to flood the market with oil in a move which sent prices spiraling.

Saudis launched oil price war after MBS-Putin shouting matchTEHRAN, Young Journalists Club(YJC)_Saudi officials with knowledge of the disastrous call told Middle East Eye that the row threatened to undo months of detente between the two countries, in which a significant arms trade was also agreed.

The call took place just before an Opec+ meeting on March 6, in which major oil producers failed to agree a deal on cutting production despite falling global demand as a consequence of the coronavirus pandemic.

“Just before that meeting there was a call between Putin and MBS. MBS was very aggressive and gave an ultimatum. He threatened that if there is no agreement, Saudi would start a price war.

"The conversation was very personal. They shouted at each other. Putin refused the ultimatum and the call ended badly,” the Saudi official said, speaking on condition of anonymity.

Before getting aggressive with Putin, bin Salman checked in with Jared Kushner, President Donald Trump’s son-in-law and senior advisor, who has been described as “the prince's most important defender inside the White House”, according to a second source who also spoke on condition of anonymity.

“The call [to Putin] had Trump’s blessing through Kushner. Kushner did not ask MBS to do it, but Kushner knew about it and did not veto it. Bin Salman drew his own conclusions,” the source said.

Oil prices plummeted after the meeting in which OPEC, Russia and other countries failed to agree on proposed cuts of 1.5 million barrels a day. Reports of the meeting suggested that Saudi Arabia had tried to "strong arm" Russia, with one industry analyst commenting: "We have just witnessed the perils of backing Putin into a corner."

The collapsing oil price was initially hailed by Trump, who presented it as an opportunity to fill up the US’s own reserves with cheap oil.

“We’re going to fill it right up to the top, saving the American taxpayer billions and billions of dollars, helping our oil industry [and furthering] that wonderful goal - which we’ve achieved, which nobody thought was possible - of energy independence,” he said.

But the White House subsequently reversed course after protests from US oil producers, many of whom have invested in more costly shale oil extraction and require significantly higher prices in order to break even.

Tags
match ، saudi ، oil
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