Oil might be a source of power, but trying to control its price is a politically hazardous business. Led by the odd pairing of the Saudi Crown Prince, Mohammad Bin Salman (MBS), and Vladimir Putin, the Opec Plus oil producers’ cartel exists to maintain a price floor for its fractious members in an energy environment where oil prices have crashed three times over the past two decades. But its importance in a geopolitical world defined by Sino-American competition is beginning to extend well beyond the gyrations of oil markets. Opec Plus has remained resilient even as the Beijing-Moscow-Tehran axis has hardened since Russia’s invasion of Ukraine, as well as the recent Chinese-brokered rapprochement between Saudi Arabia and Iran. This raises questions about whether Saudi Arabia is now defecting into the anti-Washington camp.
Opec Plus was formed in rather different geopolitical circumstances. In late 2016, the cartel constituted a rapprochement between the two large, and hitherto generally antagonistic, Eurasian oil producers as they were adjusting to the shock of the United States’ re-emergence as a top-tier oil producer. Forging an association between Opec and Moscow was an act of Saudi desperation. For the previous two years, Riyadh had sought to bankrupt the American shale sector by allowing prices to slump, but largely succeeded only in emptying its own foreign exchange reserves. When they finally reversed course in September 2016, the Saudis found that, having alienated most other Opec members with their recklessness, they could no longer control prices. Two months later, Russia and 10 other states agreed to support a second Opec oil output cut, and Opec Plus was born.
Read more: Has the West lost control of oil?
