Saudi Arabia has doubled its oil imports from Russia. US President Biden is unlikely to like that. But he will probably refrain from criticizing the ally during his visit.
While the West wants to make itself independent of Russian oil, other countries - including Saudi Arabia - are buying from the Russians. The world's largest oil exporter even doubled its imports from Russia in the second quarter, according to the Reuters news agency, citing data service provider Refinitiv. Expressed in numbers: From April to June, 647,000 tons of oil reached the Kingdom via Russian and Estonian ports. That's 48,000 barrels per day.
This raises the question: Why does a country that has enough oil buy the raw material elsewhere? Because Russian oil is a lot cheaper than their own. The kingdom uses the imported refined oil to generate electricity, allowing it to sell its own crude oil. Saudi Arabia uses a particularly large amount of electricity for cooling in the hot summer months, for example for air conditioning.
The price difference between Russian oil and that of other producers is huge. Because of the Western sanctions, Russia has to sell the oil elsewhere and thus at a significant discount. A barrel of the Russian Urals variety normally costs around 60 cents less than a barrel of the North Sea Brent variety. A barrel (159 liters) is currently around $23 cheaper than the competition from the North Sea and from Opec.
The oil is shipped to Saudi Arabia through ports in Russia and Estonia. The oil apparently reaches the EU member by rail. Russian oil can currently still be imported into the European Union. An embargo comes into force in December, which, however, allows imports by pipeline. Oil products - such as petrol and diesel - may no longer be imported at all from February next year.
US President Joe Biden travels from Israel to Saudi Arabia today. Among other things, he should be pushing for the OPEC leader to increase oil production. This should lower the price of oil, which is fueling inflation in the US. The fact that the ally is increasingly buying Russian oil shows the West's difficulties in largely isolating Russia internationally.
