The strands of Coronavirus have brought the world to a standstill; it has managed to bring diplomats and foreign policy experts to their knees as uncertainty looms over the globe. Foreign policy/International Relations scholars are in for a significant transformation and revamping of the existing power structures across the globe. One of the earliest strains in this is the heightening tensions between the United States of America and Saudi Arabia in lieu of the Crude Oil crisis that took the world by a storm last few weeks with prices dropping into negative in the markets.
With the US Presidential Elections round the corner, the cornerstone of Trump’s re-election, the American economy, has gone for a toss as the US oil companies are staring down the barrels of bankruptcy. The sudden drop in prices has put thousands of energy jobs at stake especially in the Republican states.
The US-Saudi relations span over 75 years and with the relationship warming up especially after the Trump presidency with the Trump administration unilaterally withdrawing from the Iran-nuclear deal in 2018 and slapping economic sanctions on Tehran. The Trump administration has also supported the sale of weapons to Riyadh despite its history of human rights violations.
The strains of corona fall heavy on the power balance across the world and we are yet to see the scales tilt. Over the course of past few years, events like Jamal Khashoggi’s assassination and Mohammed Bin Salman’s military campaign in Yemen have been adding to the tensions between both the countries and now it looks like the tensions are at an all-time high.
The oil prices have started to drop since January with the onset of the coronavirus as the entire world went under a rigorous lockdown affecting oil supply chains across countries. However, the prices fell off a cliff in March after Saudi Arabia initiated an oil price war in retaliation for Russia’s refusal to back Riyadh’s calls for deep output cuts and this resulted in a carnage of epic proportions that angered the US oil producers, especially companies that took heavy debt to drill new wells.
On 24th March, two US Senators introduced the Strained Partnership Act calling for the removal of US military from Saudi Arabia unless it cut its output.
During a phone call on April 2, Trump told Mohammed Bin Salah, the crown prince of Saudi Arabia that he could not stop US politicians from passing The Strained Partnership Act as long as OPEC (the organisation of petroleum exporting countries) did not curb production.
The trajectory of oil prices lies on how quickly demand will rebound and how long it takes to draw down the glut.
The US-Saudi relation is bound to get impacted with the situation of oil in the markets, but one main question to ponder upon is how much of this impact is going to manifest into long term policy issue and whether these issues will crystallise and impact the relations permanently.
But, with an election less than seven months away and an economy that is already shrinking dramatically, a move that might dampen the relations is solely not out of the picture yet.
BY MOKSHA TAMMA
References:
Image Credits: Al Jazeera, Reuters and War on the Rocks.
Literary Sources: Al Jazeera, Foreign Policy.
