It was Russia, not Saudi Arabia, that pulled out of OPEC+ deal: Saudi ministers

The logo of the Organization of the Petroleum Exporting Countries (OPEC) outside its headquarters in Vienna, Austria. (REUTERS file photo)
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Updated 04 April 2020

It was Russia, not Saudi Arabia, that pulled out of OPEC+ deal: Saudi ministers

  • Saudi foreign and energy ministers say Moscow's claim that Kingdom withdrew from the OPEC+ deal was unfounded
  • They said it was Russia that abandoned the agreement, leading to a collapse in world oil prices

RIYADH: Saudi Arabia's foreign and energy ministers on Saturday denied Russia's claim that the Kingdom abandoned the OPEC+ deal, leading to a collapse in world oil prices.

In a statement carried by the Saudi Press Agency (SPA), Foreign Minister Prince Faisal bin Farhan said "a statement attributed to one of the media of President Vladimir Putin of the Russian Federation claimed that one of the reasons for the decline in oil prices was the Kingdom's withdrawal from the deal of OPEC + and that the Kingdom was planning to get rid of shale oil producers."

"The minister affirmed that what was mentioned is fully devoid of truth and that the withdrawal of the Kingdom from the agreement is not correct," the statement said.

In fact Saudi Arabia and 22 other countries tried to persuade Russia to make further cuts and extend the deal, but Russia did not agree, it said.

Prince Farhan expressed surprise that Russia had to resort to "falsifying facts" when Saudi Arabia's stance on shale oil production is known, the statement said.

He pointed out that Saudi Arabia is one of the main investors in the energy sector in United States, implying that there is no reason for the Kingdom "to get rid of shale oil producers" as Russia has claimed.

He further said the Kingdom "is also seeking to reach more cuts and achieve oil market equilibrium for the interest of shale oil producers."

OPEC+ refers to the cooperation between members of the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC oil producers. The cooperation deal which called for cuts in production by the producers was meant to stabilize oil prices. 

In a separate statement, Saudi Energy Minister Prince Abdulaziz bin Salman rejected Russian Energy Minister Alexander Novak’s similar claim that the Kingdom refused to extend the OPEC+ deal and withdrew from it.

Novak "was the first to declare to the media that all the participating countries are absolved of their commitments starting from the first of April," Prince Abdulaziz said in a statement.

He said Novak's statement led other countries to decide "to raise their production to offset the lower prices and compensate for their loss of returns." 

On Thursday, Saudi Arabia called for an urgent meeting of oil exporters after US President Donald Trump said he expected the Kingdom and Russia to cut production by 10-15 million barrels per day.

Prince Farhan said he was "hoping that Russia would take the right decisions in the urgent meeting" so that a "fair agreement that restores the desired balance of oil markets" could be achieved.

The global oil market has crashed, with prices falling to $34 a barrel from $65 at the beginning of the year, as a result of the coronavirus pandemic. 

Fuel demand has dropped by roughly a third, or 30 million barrels per day, as billions of people worldwide restrict their movements.

A global deal to reduce production by as much as 10 million to 15 million barrels per day would require participation from nations that do not exert state control over output, including the United States, now the world’s largest producer of crude.

A meeting of OPEC and allies such as Russia has been scheduled for April 6, but details were thin on the exact distribution of production cuts. No time has yet been set for the meeting, OPEC sources said.
 


Saudi Arabia confirms $150 million donation to Gavi, the Vaccine Alliance

Updated 16 min 13 sec ago

Saudi Arabia confirms $150 million donation to Gavi, the Vaccine Alliance

  • The Kingdom announced in March that it would contribute $500 million to international efforts to fight the virus
  • Of that amount, $150 million would be allocated to Gavi, the Kingdom’s foreign minister confirmed on Thursday

RIYADH: Saudi Arabia confirmed on Thursday a $150 million donation to Gavi, the Vaccine Alliance, to help international efforts to fight the ongoing coronavirus (COVID-19) pandemic.
The Kingdom announced in March that it would contribute $500 million to international efforts to fight the virus during an extraordinary virtual G20 summit on coronavirus that it chaired.
Of that amount, $150 million would be allocated to Gavi, the Kingdom’s foreign minister confirmed on Thursday during a vaccine summit hosted by Britain.
“Of this amount, I am pleased to announce the allocation of $150 million to Gavi which will support the great efforts of the alliance,” Prince Faisal bin Farhan said.
The British government is hosting a vaccine summit on Thursday and is hoping to raise billions of dollars to immunize children in developing countries. Participants will also discuss how any potential vaccine against the new coronavirus might be distributed globally and fairly.