Saudi Arabia and the United States will work together to protect the world’s oil supply from threats, the energy ministers of the two countries said after a meeting in Riyadh.
The Saudi Press Agency reported that the two officials had also discussed the role of OPEC and non-OPEC producers in securing the world’s energy needs, as well as ways to strengthen economic ties between the United States and Saudi Arabia.
The issue of oil supply security in the Persian Gulf and Saudi Arabia specifically came to the fore last month, after drone and missile attacks on a Saudi oil field and a processing facility took close to 6 million bpd in production capacity off the market, leading to a price spike and worry about supply.
At the time, Saudi Arabia and the U.S. blamed the attacks on Iran, which rejected the accusations. The Houthi rebels took responsibility for the attacks. This led to an increase in regional tensions, fueling more concern about the security of oil supply in one of the biggest producing regions.
Following the attacks, Saudi Arabia and the United States started talking about stepping up their security partnership including by connecting Saudi missile defense systems to the U.S. ones and exploring new anti-drone technologies. Related: Tesla’s Tipping Point: Breaking Into China
What’s more, the U.S. deployed an additional 2,000 troops, along with jet fighters and three new anti-missile systems to the Kingdom to enhance the security of its ally’s oil fields. According to reports, however, Saudi Arabia would pay the bill for the deployment.
With his recent withdrawal from Syria, plenty of critics have accused Trump of having no clear foreign policy in the Middle East, this agreement and the military build-up suggests that he does have at least one priority: protect the oil.
There were worries Saudi Arabia would not be able to quickly restore production capacity and this would lead to a shortage on the international oil market, but in truth Aramco was pretty speedy with the resumption of operations. Full capacity should be restored by the end of next month, the company said in its latest update on the situation.
By Irina Slav for Oilprice
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