Saudi Arabia says to buy Russian Federation S-400 defence systems, other arms

Reuters

USA shale oil coming to the market is not a concern, Saudi Energy Minister Khalid al-Falih said on Thursday, adding that demand will absorb it.

The rebalancing of oil inventories is well under way, he said.

He further said that Russian Federation is satisfied with the current level of oil prices.

The leaders of the world's largest energy exporters also discussed the Opec agreement to cap oil output.

Though a rally in September helped propel oil into a bull market, prices have slipped back amid concern the market remains oversupplied despite cutbacks by the Organization of Petroleum Exporting Countries and its allies including Russian Federation. "What we did with OPEC, I believe, is beneficial for all the global economy".

The plan to float around 5 percent of Aramco in an initial public offering (IPO) is a centerpiece of Vision 2030, a wide-ranging reform plan to diversify the Saudi economy beyond oil which is being championed by Saudi Crown Prince Mohammad bin Salman.

According to Kremlin spokesman Dmitry Peskov, the potential for the bilateral cooperation is "far from being unleashed in full", while the two countries are "demonstrating political will" to bolster its development. "The market can absorb it", he said, speaking at an energy forum in Moscow.

"The Russians have gone out of their way to welcome the Saudi King, hoping to open a new page in relations with the wealthy kingdom", said Fawaz Gerges, professor of International Relations at the London School of Economics.

Russian Federation is set to host the World Cup from June 14-July 15 in 12 venues spread across 11 cities including Moscow, St Petersburg, Kazan and Sochi.

"The visit is likely to strengthen trade ties between Russian Federation and Saudi Arabia, but most are wondering whether two of the world's major oil producers will be discussing a collaboration to improve the price of oil", Ahmad said.

Saudi Arabia has agreed to buy Russian S-400 surface-to-air missile systems, Saudi-owned al Arabiya television reported on Thursday. However, no contracts have been signed yet.

Russian President Vladimir Putin said on Wednesday a deal between OPEC and rival oil producers to reduce production could be extended to the end of 2018, a longer timeframe than others have suggested, in a bid to curb a supply glut.

In July, Rostec CEO Sergei Chemezov announced the signing of a preliminary agreement in the field of defense cooperation between the Russian Federation and Saudi Arabia in the amount of 3.5 billion USA dollars.

Earlier this year Saudi Arabia pledged billions of dollars of investment in projects in Indonesia and Malaysia to ensure long-term oil supply deals.

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