Russian President Vladimir Putin has to solve his strategic tasks while US President Donald Trump is in the White House. This was stated in the commentary to the GORDON publication by a Russian-American historian, the author of the book FSB Explodes Russia, Yuri Felshtinsky.
“Is the Russian economy capable of withstanding such a dramatic fall in the price of oil? I think no one knows. At the time of Boris Yeltsin, in the early 1990s, the price of oil was about $ 12 per barrel. This was one of the reasons for the extremely difficult situation of the Russian economy and the Yeltsin’s government. The oil price has been rising steadily since the late 1990s. This was not related to the regime in Russia and not to the rise of Vladimir Putin to power, but to the global rise in raw material prices on the world market. Unfortunately, every time oil price rose above $ 100 per barrel, Kr Land used oil money to start wars, as happened in 2008, when Russia entered Georgia, and in 2014, when Russia entered Ukraine. Accordingly, we can expect that now, with the falling price of oil, Russia’s foreign policy activity will decline“The historian said.
He noted that US President Donald Trump is trying to raise the price of oil and thus help the Russian president get out.
“There are two serious circumstances that make the current situation completely unpredictable: the first is coronavirus; the second is Trump’s presence in the White House. It may turn out that Trump is there for the last year. If Trump loses the election, Putin will lose his ally. Therefore, Putin has to decide his strategic while Trump is in the White House, I don’t know if he will be able to do this when oil prices and the coronavirus pandemic fall, maybe Putin seems to be a serious ally to achieve some of his goals. We see how in recent days Trump has been making open and, I would even consider, risky personally for him, contrary to the interests of the United States and the American people, attempts to artificially raise the price of oil and thereby help the Putin regime get out of this difficult situation, which Putin got because of the oil war with Saudi Arabia, “Felshtinsky emphasized.
In his view, by lowering oil prices, Saudi Arabia seeks not so much to put pressure on Russia, but rather to undermine Iran’s economy.
“You need to understand that the decision of Saudi Arabia not to reduce oil production and thus lower its price is connected not only with the desire of Saudi Arabia to increase its share in the world oil market and suppress competitors, but, most importantly, to deliver an economic blow to its main strategic foreign policy opponent – Iran, for which oil is the only serious source of obtaining foreign currency. By reducing oil prices on the world market (which, by chance, tangible help coronavirus) Saudi Arabia on carries Iran’s most powerful economic blow, comparable to open hostilities, “the historian concluded.
Until April 1, an agreement was reached between OPEC member countries and organization partners, including Russia, to reduce oil production by 1.7 million barrels per day. Amid unsuccessful negotiations, Saudi Arabia, according to Bloomberg sources, decided to enter into a “total price war” and increase production from the current 9 million to 12 million barrels per day. At the same time, Russia does not plan to increase oil production.
The fall in oil prices has continued since early March. The main reason was that Russia and the Organization of Petroleum Exporting Countries could not agree on new restrictions on the level of oil production. By March 9, the price of Brent oil collapsed by 30% – up to $ 33 per barrel, which was the maximum daily drop since 1991, when the Gulf War began.
On March 30, the price of WTI crude oil fell below $ 20 per barrel for the first time since 2002. This is evidenced by trading data. At night, a barrel of WTI oil was trading at $ 19.98. According to trading on the London ICE, the price of Brent barrel oil for May delivery fell to $ 23.39. June futures are trading at $ 26.73.