Rapprochement with Moscow opens new opportunities of cooperation
The first step toward rapprochement was made in September 2003 during the visit of then-Crown Prince Abdullah to Moscow. It was marked by the signing of a number of bilateral agreements. One of the most important was on cooperation in the oil and gas sector. It brought two big Russian companies, Lukoil and Stroytransgaz, to the Saudi market.
Despite all the difficulties of entering a new market, both companies achieved success. Lukoil discovered gas-condensate deposits, and Stroytransgaz completed construction of the Shaybah-Abqaiq oil pipeline, receiving the highest appraisal from its client Saudi Aramco.
The positive development of bilateral relations that followed was halted by the conflict in Syria in 2011, in which our countries took opposing positions. But the arrival to power of King Salman in January 2015, and the meeting of his son Mohammed bin Salman with President Vladimir Putin in May that year, ended the four-year period of no relations.
The achieved deals were perceived as the Kingdom’s positive response to numerous Russian calls to develop economic and investment cooperation despite foreign policy disagreements. During the same meeting in 2015, Putin sent an invitation to King Salman, which he accepted.
But after this visit the dates were shifted several times, probably due to lack of trust and the absence of a favorable environment due to the conflict in Syria. Apparently, there were expectations that one of the parties would make concessions to receive material gains. Nevertheless, thanks to the political will of Putin and King Salman, efforts to find mutual understanding on political and economic issues did not stop.
What made the current visit possible? In the same way as in 2003, the rapprochement is determined by the need to cooperate in the oil sector, on which both countries still greatly depend. Having suffered serious losses during the period of low crude oil prices on the international market, Russia and Saudi Arabia understood that the best way to compete is to cooperate.
After overcoming their differences, both sides reached an agreement on cooperation in 2016 to stabilize the oil market and establish so-called “fair” oil prices that are acceptable to both producers and consumers.
Market stability and acceptable prices are vital to overcoming the economic challenges that the two countries face. Russia has to withstand Western sanctions, while the Kingdom chose the path of reforms to get rid of dependence on oil and to diversify its economy. The strategy of economic, social and cultural transformation is declared in Vision 2030.
Mutual understanding enabled constructive dialogue between the heads of energy institutions, Alexander Novak and Khalid Al-Falikh, who agreed to do “everything possible” to stabilize oil prices. Common ground was also reached by heads of oil giants: Igor Sechin from Rosneft and Amin Naser from Saudi Aramco.
As a result, they managed to reach an unprecedented agreement on cooperation in the markets of Asian counties such as India, Indonesia and others. Experts claim that Russian companies may be invited to realize mega-projects in Saudi Arabia, and that Saudi Aramco may take part in Arctic projects in Russia.
The meeting between King Salman and President Vladimir Putin is destined to provide a new impetus to a multidimensional development of bilateral relations, in the interests of the people of both countries and Middle East stability.
But oil and gas is not the only domain of bilateral cooperation. Vision 2030 creates prospects for foreign companies, and both countries believe that nuclear energy, where Russia is the world’s leader, can become the largest field of cooperation.
Another hi-tech domain is space exploration. Here, the parties can develop an existing partnership, as Russian rockets have already launched several satellites constructed in Saudi Arabia.
Military production offers great prospects in the hi-tech sphere as well. Russia is widely recognized as a producer of the most modern military equipment, and the Kingdom — the world’s biggest weapons importer — has decided to create its own arms production industry with the participation of foreign companies. On Thursday, Saudi Arabia signed an agreement to buy S-400 air defense systems and receive “cutting edge technologies” from Russia.
Unlimited opportunities for cooperation can be found in Russian agriculture, mining and processing of minerals — domains that are in line with Vision 2030, and where Russia has vast experience. Wood processing, car and furniture production, civilian infrastructure, medicine, drinking water supplies and many other spheres have potential for cooperation.
Both countries’ institutions and private companies should determine the main directions for cooperation that are starting to open up thanks to Vision 2030, and formalize these directions in a separate document.
It appears that the most important political factor behind King Salman’s visit to Moscow is the interest in a strategic partnership to stabilize the Middle East and Syria in particular, as both Moscow and Riyadh wish to preserve the country’s sovereignty and territorial unity.
The convergence of the Russian and Saudi positions — not only on Syria, but also on Iraq, Yemen and Libya — was recently confirmed by the foreign ministers of both countries. According to UN statistics, Moscow and Riyadh hold similar positions on 90 percent of issues.
Russia’s decisive contribution to the fight against Daesh has perceptibly changed Moscow’s standing in the region, including in Saudi Arabia. Rapprochement with Moscow strengthens the Kingdom’s regional positions, and opens new opportunities of cooperation in order to re-establish stability in the Middle East.
Partnership with Riyadh, Russia’s military might and its good relations with most of the region’s countries can together lead to positive processes. The high-level meeting in Moscow is destined to provide a new impetus to a multidimensional development of bilateral relations, in the interests of the people of both countries, as well as regional and global stability.
• Konstantin Dudarev, author of “Saudi Arabia: The 21st Century in the Homeland of Islam,” was general manager of Russian engineering company PJSC Stroytransgaz’s branch in the Kingdom. [email protected]