Does Saudi Arabia hold the key to lower energy prices?

But that doesn’t mean Saudi oil could “quickly replace supply coming out of Russia”, said Karen Young, founding director of the Program on Economics and Energy at the Middle East Institute, based in Washington. “Increasing production does not mean increasing exports directly to Europe,” she told DW. “Oil markets are not that easily redirected.”

But in producing more oil, the Saudis could bring global market prices down, she explained.

However, the Organization of the Petroleum Exporting Countries, of which Saudi Arabia is a member, has a “long-standing policy of not changing production or supply on the basis of geopolitical events”, said Hasan Alhasan, a research fellow on Middle East policy for the International Institute for Strategic Studies in London.

“They only change in response to changes in market fundamentals,” he said. 

A moral compromise

It is hoped Johnson’s “personal relationship” with Saudi Crown Prince Mohammed bin Salman, the Saudi de facto ruler, can be used to open the door to the Gulf states increasing oil and gas production, said The Times.

The prime minisiter has been “touted as a mediator”, said The Telegraph, after US President Joe Biden’s public criticism of Saudi Arabia as a “pariah” state, following the murder of journalist Jamal Khashoggi at the Saudi consulate in Istanbul in 2018.

It is true that “no G7 country has better links with the crown prince”, said The Times columnist James Forsyth. But the relationship “undoubtedly involves dubious moral compromises”, he continued. 

The UK justifies its relationship with Saudi Arabia “despite its appalling record on human rights and its role spreading Salafist Islamist ideology” on the basis that “we cannot afford not to have the kingdom as an ally, that its friendship is essential to economic stability”. But if the British government cannot persuade Riyadh to calm the oil market, “then the whole point of the relationship will be called into question”, Forsyth continued.

Health Secretary Sajid Javid was forced to deny that the UK was “turning a blind eye to the world’s evils in order to keep the lights on”, as suggested by Sky News presenter Kay Burley during an interview over the weekend. 

And reports of Johnson’s intended visit came as news broke that Saudi Arabia had executed 81 people on Saturday, for reasons including terrorism, murder and holding “deviant beliefs”, reported The Telegraph. 

Javid said that under three Tory prime ministers, the government had “always had a very candid and frank relationship with Saudi Arabia”.

He continued: “Wherever there are human rights issues we have raised them with them and we can do that because we have this relationship. But we also have an economic relationship with Saudi Arabia, we’re not dependent directly as a country on their oil, but energy prices and access to energy is a hugely important issue.

“So I’m pleased that we can have this relationship with Saudi Arabia where we can talk about the human rights issues as well as our longer-term economic relationship.”

Article source: https://www.theweek.co.uk/news/uk-news/956083/saudi-arabia-oil-prices