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- sarahfailin0
Russia Takes Aim at U.S. Shale Oil Producers
Moscow is fighting a oil-market war on two fronts—with Saudi Arabia and U.S. shaleRussia’s oil-market war with Saudi Arabia is part of a strategic campaign to cripple U.S. shale-oil production, a powerful economic tool that increasingly allows Washington to advance its foreign policy agenda, say people briefed on the Kremlin’s policies.
Less than two weeks ago, President Vladimir Putin summoned Russian oil companies to a conference room at Moscow’s Vnukovo airport to discuss strategy ahead of a meeting between OPEC and its allies on March 5-6.
For four years, Saudi Arabia and Russia had been curbing production together to prop up prices. But with the deadly new coronavirus beginning to sap global oil demand, Riyadh wanted an aggressive response with deep output cuts. Russia wanted more time to see if the effects of the virus would be temporary.
Mr. Putin asked the room whether Russia could withstand a sharp decline in oil prices that was expected if neither side could reach a compromise. Igor Sechin, the head of the state-controlled giant Rosneft and widely considered a staunch nationalist in Mr. Putin’s circle, said low crude prices “are great because they will damage U.S. shale,” according to people familiar with the meeting.
Days later, Mr. Putin sent his energy minister, Alexander Novak, to the OPEC talks with no mandate to negotiate a production cut with the Saudi-led group, according to oil officials in the cartel. The move, combined with a Saudi insistence on deeper, longer-lasting curbs, led to the collapse of the talks on March 6.
- What's to stop Putin from going in and taking Saudi Oil fields? Their only ally is the US and even then..._niko