#10 - RW 272
Saudi leader's visit to Russia brings key oil accord, closer ties
September 4, 2003
AFP

Saudi Arabia's de facto ruler, Crown Prince Abdullah bin Abdul Aziz, Thursday wound up a historic three-day visit to Russia in which the world's two largest oil exporters signed a key cooperation agreement aimed at stabilising oil prices.

The visit, the first by a Saudi ruler since 1926, marks a strategic rapprochement between two countries who between them control a substantial proportion of the world's hydrocarbon resources.

With Saudi Arabia sitting on around a quarter of the world's known oil reserves and Russia the biggest exporter of oil outside the Organization of Petroleum Exporting Countries (OPEC), the two producers' combined weight enables them to exercise a predominant influence on global oil prices.

Saudi Oil Minister Ali Ibrahim Naimi noted on Wednesday that the current state of the oil market served as proof of the two countries' success at keeping it stable.

His Russian counterpart Igor Yusufov agreed. "We feel ourselves responsible for the world market's stability. So the signing of our cooperation accord was quite timely," he said.

In a joint statement winding up the visit, President Vladimir Putin and the Saudi leader agreed on "the need to interact in oil policy to achieve stability and predictability" in the global market, keeping prices within "an acceptable corridor."

This would be achieved both on a bilateral basis and in a multilateral format working with other oil-producing countries, they said.

The prince left Moscow to return to Riyadh in mid-afternoon, Saudi embassy officials said.

The framework five-year oil and natural gas cooperation accord was signed Tuesday and could lead to deals worth up to 25 billion dollars, Yusufov noted.

The head of the Russian Oil and Gas Producers Union, Yury Shafranik, said that Gazprom, Soyuzneftegaz and the Russian Engineering Company would be among the firms offering new oil extraction and prospection technologies to Saudi authorities, ITAR-TASS reported.

The visit also signals a marked improvement in Russo-Saudi relations after several decades of coolness arising from Saudi mistrust regarding Moscow's ambitions in the Islamic world, most notably with the Soviet intervention in Afghanistan.

However relations have improved gradually since Moscow reopened its embassy in Riyadh in 1991, and Saudi estrangement with the United States over the September 11 attacks, in which most of the attackers were Saudi nationals, has accelerated the process.

The global fight against terrorism topped the agenda at the meeting of the two foreign ministers, Igor Ivanov and Saud al-Faisal, on Wednesday, where they pledged to work closely to overcome the threat.

They announced the creation of a working group "to prepare effective measures to eliminate this dangerous evil."

The Chechen issue was not mentioned in public, but the Izvestia daily said that the Saudi ruler had promised to take action against Muslim charities that Russia has accused of funding Chechen separatists.

The two countries were able to present broadly similar views on Iraq, where both opposed the US-led intervention last March, and on the Middle East.

They voiced the hope that the interim Iraqi administration announced last Monday would "become a legitimate government" and defended the internationally-backed "roadmap" to Mideast peace against Palestinian leader Yasser Arafat's reported charge that it was "dead."

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