Events

Date: Thursday, March 16th, 2023
Time: Wine served at 11:00 am  |  Lunch & Lecture starts @ 11:30 am to 1:30 pm
Venue: Petroleum Club of Houston, 1201 Louisiana St, Houston, TX 77002

Synopsis:

High-level cooperation between a pair of Cold War adversaries—Saudi Arabia and Russia—became a hallmark of the enlarged OPEC+ grouping in 2016 and has since become a feature of the global energy landscape. Unexpectedly durable Saudi-Russian collaboration has increased the size of the cartel and its level of discipline and effectiveness, while imbuing it with a more “hawkish” pursuit of higher oil prices. In staking out these positions, Riyadh has also demonstrated increasing support for Russia’s interests while distancing itself from US influence in ways that have tested the basis of a relationship built partly around “oil for security.” In particular, the kingdom has grown less willing to consent to US presidential requests to increase oil production or follow the US lead in isolating Russia over its invasion of Ukraine. The OPEC+ group’s Oct. 5, 2022, decision to aggressively cut production despite vehement US opposition is emblematic of this changed dynamic.

The change in Saudi behavior, intensified under the Biden administration, represents a clear break from the kingdom’s oil market strategy since the 1980s. It appears to leave the US executive branch with fewer short-run options for dealing with spikes in oil prices. The president’s subsequent sale of oil from emergency stocks held in the US Strategic Petroleum Reserve is one result. However, the enhancement of Saudi leverage is partly due to tight oil markets, which suggests that any tilt toward Riyadh in the balance of power may be temporary.

Uncertainties exist around the durability of both US-Saudi and Saudi-Russia relations and the degree to which they can coexist at a time of far greater strategic rivalry, great power competition, and transitioning energy systems. The diplomatic drift between Riyadh and Washington may be temporary, given continued co-dependence on defense and security partnerships that benefit both partners. Meanwhile, the long-term robustness of the less tested Saudi-Russia friendship remains in question. While the two autocratic exporters share common interests, many points of friction exist that could unwind the partnership.

Presenter:

Kristian Coates Ulrichsen

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**Early-bird registration ends Tuesday March 14th at NOON.
Late / walk-in registration tickets will be available for $65 for both members and general admission**