President Vladimir Putin of Russia
I found the following FT article so interesting and pertinent in today’s turmoil that I wanted to share it with my followers. So here it is.
President Vladimir Putin of Russia appears to be on a roll in his relations with the US, or at least with Donald Trump, its mercurial president. Last week, the two countries issued a call for co-operation to mark the 75th anniversary of the meeting between American and Soviet troops on a bridge over the River Elbe in Germany, marking the defeat of the Nazis. A week before that, Mr Trump concluded a particularly rambling White House briefing by remarking that Mr Putin — authoritarian leader of a country under US sanctions and accused of interfering in the US presidential election of 2016 — was “a total gentleman”. The flourish came a week after Russia participated with Saudi Arabia-led oil producers in the Opec+ cut in output. This aimed to put a floor under the collapsing oil price that has trigged stock market mayhem and threatened the future of the US shale oil industry, all amid the economic havoc wreaked by the Covid-19 pandemic and in a year that Mr Trump faces re-election. The radical dislocation of the oil market — amid still rampant oversupply and the near exhaustion of storage capacity — continues. But so too, for the moment, does Mr Trump’s benign attitude towards his Russian soulmate strongman. Can it last? It was Russia that declined to continue with three years of Opec+ output restraint to shore up crude prices in Vienna in March. But it was Saudi Arabia that reacted to this by making aggressive price cuts and flooding the market with oil, even as global demand is set to contract by about a third as an economic result of the coronavirus pandemic. US ire was then directed more towards its Saudi ally — whose oilfields it is protecting against Iran and its Arab proxies — than its strategic adversary, Russia. It may be that the Saudis, recklessly led by their young crown prince and de facto ruler, Mohammed bin Salman, will continue to bear this taint of betrayal. Mr Trump has been Prince Mohammed’s only unconditional supporter. But, more than allies, the US president has interests. Mr Putin, for now, may feel sanguine about his standing with Mr Trump. The Russian president helped prompt the “MAGA” (Make America Great Again) president, who so loathes multilateralism, into sponsoring a rare global measure. Mr Putin may even hope his co-operation could lead to a relaxation of US sanctions. Yet, rather than a “reset” in Russian-US relations, there are reasons to think this looks more like a “score-draw” that may see a replay. On the substance of the Opec+ oil output deal, for example, Russia agreed to much bigger cuts than the ones it had earlier rejected in Vienna. Saudi cuts will probably end up as significantly less. And US “cuts” will come from attrition in the shale oil sector. The latter underlines that the deal is not working anyway. So, Russia, as well as the Saudis, will be blamed in the US if thousands of energy jobs drown in a glut of oil. That is, above all, because — unlike Riyadh, which seems to have acted in petulance — Moscow took strategic aim at the US oil industry. Igor Sechin, chief of Rosneft, the state oil company, and long one of Russia’s most powerful men, wrote to Mr Putin last year, before Moscow changed tack on Opec+, complaining that its output restraints had “created a preferential advantage for the US . . . which has become a strategic threat to Russia’s oil industry development”. If Mr Putin did indeed buy the Sechin thesis, that was surely a mistake. The US president gave him the opportunity to retreat in something like a statesmanlike fashion. But Opec+ is not delivering. The Russian president may have glimpsed the tactical opportunity to drive a wedge between the US and Saudi Arabia — a reprise of Moscow’s partial success in dividing America from Turkey in 2016-19. The rapprochement with Turkey and the partnership with a Nato ally that Mr Putin must particularly savour was built fundamentally around co-operation in Syria, which the US has all but walked away from. But that came apart spectacularly in February when the Turkish army and its Syrian proxies clashed bloodily with the Russian air force-backed regime of Bashar al-Assad in the Syrian rebel redoubt of Idlib. Mr Putin may reflect that the US-Saudi relationship was also forged at a historic meeting. That was in 1945 when President Franklin D. Roosevelt met King Abdulaziz Ibn Saud, founder of the kingdom and grandfather of Prince Mohammed, on a US warship in the Suez Canal. It is not a relationship to be surrendered lightly — whereas Mr Trump’s sunny disposition towards Mr Putin may soon fade.