Berliner Boersenzeitung - 'Not our war': Gulf states resist pressure to raise oil output

EUR -
AED 3.944001
AFN 75.707953
ALL 99.726144
AMD 417.036766
ANG 1.939534
AOA 918.071057
ARS 968.766229
AUD 1.617851
AWG 1.935466
AZN 1.827112
BAM 1.949885
BBD 2.172847
BDT 126.466335
BGN 1.955143
BHD 0.404701
BIF 3091.376577
BMD 1.073767
BND 1.452294
BOB 7.43644
BRL 5.760015
BSD 1.07618
BTN 89.90228
BWP 14.641717
BYN 3.521718
BYR 21045.842624
BZD 2.169159
CAD 1.475625
CDF 3054.868056
CHF 0.959932
CLF 0.035731
CLP 985.932381
CNY 7.787608
CNH 7.80608
COP 4448.618673
CRC 567.368191
CUC 1.073767
CUP 28.454838
CVE 110.706682
CZK 24.710293
DJF 190.830221
DKK 7.460107
DOP 63.755271
DZD 145.104602
EGP 51.224829
ERN 16.106512
ETB 61.741775
FJD 2.398477
FKP 0.84248
GBP 0.841577
GEL 3.071093
GGP 0.84248
GHS 16.149576
GIP 0.84248
GMD 72.774606
GNF 9239.7693
GTQ 8.359678
GYD 225.048312
HKD 8.386608
HNL 26.63128
HRK 7.53617
HTG 142.852633
HUF 396.778869
IDR 17485.229658
ILS 3.98975
IMP 0.84248
INR 89.748332
IQD 1406.6354
IRR 45192.194067
ISK 149.307299
JEP 0.84248
JMD 167.510259
JOD 0.761191
JPY 168.615872
KES 137.997284
KGS 93.544688
KHR 4420.70041
KMF 492.326658
KPW 966.390874
KRW 1478.094335
KWD 0.329045
KYD 0.896846
KZT 485.319593
LAK 23386.656054
LBP 96209.566495
LKR 327.055619
LRD 208.311013
LSL 19.757079
LTL 3.170556
LVL 0.649511
LYD 5.20769
MAD 10.680231
MDL 19.155975
MGA 4799.74117
MKD 61.487731
MMK 2308.599532
MNT 3704.497914
MOP 8.657793
MRU 42.360267
MUR 50.080443
MVR 16.546857
MWK 1861.368518
MXN 19.74048
MYR 5.054762
MZN 68.393636
NAD 19.759654
NGN 1616.02029
NIO 39.521545
NOK 11.445928
NPR 143.841285
NZD 1.740304
OMR 0.413351
PAB 1.076135
PEN 4.049191
PGK 4.177046
PHP 62.986121
PKR 299.124766
PLN 4.34806
PYG 8089.233456
QAR 3.909568
RON 4.977229
RSD 117.097625
RUB 94.353636
RWF 1417.373075
SAR 4.02829
SBD 9.081501
SCR 15.028477
SDG 629.227565
SEK 11.256198
SGD 1.450549
SHP 1.356651
SLE 24.532691
SLL 22516.369248
SOS 613.12115
SRD 33.916027
STD 22224.818925
SVC 9.416083
SYP 2697.873466
SZL 19.759333
THB 39.439394
TJS 11.595299
TMT 3.758186
TND 3.342675
TOP 2.527917
TRY 34.84096
TTD 7.31354
TWD 34.751626
TZS 2815.358965
UAH 43.847387
UGX 4013.841784
USD 1.073767
UYU 42.082529
UZS 13567.051832
VEF 3889779.109093
VES 39.068488
VND 27319.329131
VUV 127.479796
WST 3.007209
XAF 653.973023
XAG 0.037067
XAU 0.000466
XCD 2.901911
XDR 0.816431
XOF 660.900688
XPF 119.331742
YER 268.817881
ZAR 19.802415
ZMK 9665.197025
ZMW 28.3831
ZWL 345.752691
  • RBGPF

    0.0000

    56.5

    0%

  • JRI

    -0.0800

    12.11

    -0.66%

  • BCC

    -1.1800

    130.5

    -0.9%

  • CMSC

    0.0000

    24.5

    0%

  • SCS

    -0.2000

    12.33

    -1.62%

  • NGG

    -0.7500

    56.15

    -1.34%

  • GSK

    0.0000

    41.11

    0%

  • BCE

    -0.3100

    33.98

    -0.91%

  • CMSD

    0.1200

    24.46

    +0.49%

  • RIO

    -0.1600

    66.92

    -0.24%

  • RELX

    -0.0800

    45.65

    -0.18%

  • RYCEF

    0.0200

    5.98

    +0.33%

  • AZN

    -0.5400

    79.53

    -0.68%

  • BP

    -0.3700

    35.19

    -1.05%

  • BTI

    -0.0700

    30.6

    -0.23%

  • VOD

    -0.0800

    8.75

    -0.91%

'Not our war': Gulf states resist pressure to raise oil output
'Not our war': Gulf states resist pressure to raise oil output

'Not our war': Gulf states resist pressure to raise oil output

Russia's invasion of Ukraine has sent energy prices surging, but the oil-rich Gulf monarchies have so far resisted Western pressure to raise output, prioritising their own strategic and economic interests.

Text size:

The price of a barrel of West Texas Intermediate crude topped $115 on Thursday, the highest since 2008, as the war and sanctions against Moscow stoked fears about global supplies.

Russia is the world's second biggest crude exporter after Saudi Arabia, which is close to Western governments but also to Moscow.

The Organisation of Petroleum Exporting Countries and its allies (OPEC+), led by Riyadh and Moscow, failed Wednesday to respond to a call to produce more and faster, despite pressure on the Gulf states in particular.

The group argued that the "current volatility is not caused by changes in market fundamentals but by current geopolitical developments," according to a press release.

"Gulf countries are testing their ability to have a strategic autonomy, to defend their own national interests," Hasan Alhasan, a Middle East specialist at the International Institute for Strategic Studies, told AFP.

The Gulf countries, which had suffered from declines in oil prices since 2014, now seem all the more reluctant to take immediate action as they benefit from the short-term price surge.

If the barrel stays above $100, this will mean that none of the six Gulf Cooperation Council countries will face a budget deficit by 2022, wrote researcher Karen Young of the Washington-based Arab Gulf States Institute.

- 'Keeping Russia' -

Amena Baker, an analyst with Energy Intelligence, said that according to OPEC+ "there is no physical shortage of crude in the market.

"The impact of the Western sanctions against Russia's hydrocarbon exports is still unknown," she told AFP.

Baker said the only two OPEC+ countries able to truly open the floodgates are Saudi Arabia and the United Arab Emirates, but that even they would be unable to make up for Russian exports.

"Overall our calculations put spare capacity of OPEC+ at 2.5 million barrels per day and that's much less than what Russia exports... Russia's exports are closer to 4.8 million bpd," she said.

However, producing countries are aware that high prices risk depressing the global economy and accelerating the energy transition away from fossil fuels, at a time of fragile post-Covid recovery.

"What is most important for Saudi Arabia is oil price stability," said Alhasan, who added that the kingdom counts on Russia's cooperation in this.

The last time Saudi Arabia and Russia clashed over production quotas, it led to a price war and a collapse of prices, he recalled.

Baker agreed that "keeping Russia as part of OPEC+ is also seen as very important by member states ... That's the only way to ensure an effective market managing tool in the years to come."

- 'Stress test' -

The International Energy Agency announced Tuesday that member countries would release 60 million barrels of oil from their strategic reserves to stabilise global markets.

Half, 30 million barrels, will be released by the United States.

Alhasan said the pressure the United States has exerted on its close Gulf partners has been "limited" so far, adding that "we'll see if the pressure will increase in the coming days".

According to the analyst, the "Gulf countries have said: 'This isn't our war.' A very similar message, by the way, to the one consistently sent by the US to the Gulf states on Yemen... over the past several years."

Saudi Arabi and the UAE -- close diplomatic and military partners of the United States -- have intervened in Yemen since 2015 to support government forces against Huthi rebels, who are backed by Iran.

Riyadh and Abu Dhabi would like stepped-up support from Washington against the rebels, but the US has been reluctant to engage further in a conflict where all parties have been accused of war crimes.

The UAE hosts US troops and has been a strategic partner to Washington for decades, but its ties with Russia have also been growing.

In its current role as holder of the UN Security Council's rotating presidency, the UAE abstained last Friday from voting on a US-Albanian draft resolution condemning Russia's invasion of Ukraine.

US-UAE relations now face a "stress test", said Yousef al-Otaiba, the Emirati ambassador to the US, but he voiced confidence that "we will get out of it and we will get to a better place".

(T.Renner--BBZ)