The World Cup changed all that. The Saudi crown prince and de facto leader Muhammad bin Salman flew to Russia to support his team in the tournament’s opening match against the hosts. After the Saudis’ devastating defeat, the young royal was consoled at the stadium by President Vladimir Putin himself. What they discussed remains a mystery, but after the prince returned to his homeland, both Saudi and Russian officials suddenly demanded a relaxation of the quotas. Russia’s Energy Minister Alexander Novak went as far as proposing to raise production by 1.5 million barrels per day. If implemented it would effectively wind down the OPEC+ agreement.
That U-turn provoked resistance from several OPEC members. The Iranian delegation led the charge. For them it was a matter of principle to stand firm against the pressure of its two arch-enemies — Saudis and U.S. President Donald Trump. The latter, in his characteristic manner, posted brash tweets demanding that OPEC should raise output.
In order to strengthen their camp, Saudi Arabia and its allies did everything possible to win over the producers from outside the cartel. Suheil al-Mazrui, the OPEC chairman promised a new, closer agreement with Russia. And Muhammad bin Salman proposed holding a special OPEC+ summit in Riyadh attended by Putin as guest of honour.
It may seem that as a result of this active oil diplomacy, the Saudis and OPEC bolstered their influence. On the contrary, the Russian-Saudi alliance testifies not to the strength, but to the weakness of OPEC. In the past, the Saudis managed to balance the oil market without the assistance of their Russian counterparts. But then the shale revolution shifted the role of “swing producer” from the Saudi monarchy to the United States.
