Are Old Rivals Russia And Saudi Arabia Forging A Strong Partnership?

Russia and Saudi Arabia might be getting into a tenuous partnership, even as the world's top crude producers signed six deals in major spheres, including defense and energy, according to sputniknews.

The partnership was signed in the Saint Petersburg International Economic Forum by the top-ranked Saudi delegation, headed by Deputy Crown Prince and Defense Minister Muhammad bin Salman.

Saudi Arabia is rumoured to be eyeing the setting up of 16 nuclear reactors operated by Russia, according to the Saudi-owned al-Arabiya. However, Riyadh is not looking to just Moscow for nuclear cooperation, but also Argentina, China, France, South Korea and the United States, which have the technology to foster nuclear growth.

Moreover, Saudi Arabia is expanding its list of energy partners. Hence, Riyadh and Moscow want to revive the intergovernmental commission to take on energy projects in the future and enable Russia to access innovative energy technologies.

"Given that the US and EU sanctions limit the transfer of new oil and gas technology to Russian state oil firms, reports indicate that Russia could be seeking enhanced oil and gas recovery and advanced drilling technology from Saudi Arabia, especially for use in the older fields in West Siberia," Saudi Gazette  reported.

Strangely, as Moscow and Riyadh are oil market rivals, their tie-up comes as a surprise to many.

Currently, Russia's oil output of 10.78 million barrels per day in May has broken its own record. Saudi Arabia is producing 10.3 million bpd as of May. However, this is not the upper limit for both countries.

They are both vying for the Chinese market, which is the largest in the world. "In the race to grab a significant share in the Chinese crude market, at least for the time being, Moscow seems to have pipped Riyadh too," Saudi Gazette observed.

Incidentally, Moscow's decision to conclude deals in the Chinese yuan helped to make this happen.