Prince Abdulaziz Bin Salman… The Oil Diplomat

Prince Abdulaziz Bin Salman… The Oil Diplomat
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Prince Abdulaziz Bin Salman… The Oil Diplomat

Prince Abdulaziz Bin Salman… The Oil Diplomat

The Organization of the Petroleum Exporting Countries (OPEC) has known many highly qualified ministers and technocrats, but very few people knew how to assume a high diplomatic role in which political cards are mixed with the technical vision.

Prince Abdulaziz bin Salman, who was named as energy minister this month, is one of the most prominent oil diplomats in OPEC history. With his appointment, Prince Abdulaziz became the sixth minister in the history of Saudi Arabia to receive the oil file, after Abdullah al-Tariki, Ahmed Zaki Yamani, Hisham Nazer, Ali al-Nuaimi, and Khaled al-Falih.

Prince Abdulaziz bin Salman is the fourth son of King Salman bin Abdulaziz, after Princes Fahd, Sultan, and Ahmed. Since the 1980s, he has been active in the Energy ministry and has been a steady member of the Saudi delegation to OPEC.

In many situations, he was the “link” between the oil world and the higher authorities in the Kingdom, and in others, he was the mediator between the various OPEC countries.

“He was born into power, he understands power — when to use it and when not to use it,” said OPEC Secretary-General Mohammad Barkindo.

Prince Abdulaziz has always worked with clear diplomacy behind the scenes. But everyone who worked at OPEC knew what role he assumed.

He signed many achievements during his previous career with the Ministry of Petroleum (now Energy).

For example, he was part of the Kingdom’s negotiating delegation to join the World Trade Organization. One of the prince’s most notable achievements was the National Energy Conservation Campaign, which managed to move stagnating water to save Saudi oil, which was burned in terrible quantities every year.

The prince devoted most of his time to this campaign since 2013. Many accomplishments were made within its framework, including eliminating non-energy-saving air conditioners, setting strict requirements for the import of electrical appliances, and changing the specifications of cars imported by the Kingdom to be more fuel-efficient.

At OPEC, Prince Abdulaziz is popular with delegations and dozens of journalists who meet him constantly.

“People abroad do not realize unfortunately that when the princes enter the Ministry of Petroleum, they take off their ‘Bisht’ (cloak) and work like everyone else; they are the same as other employees. Hadn't we worked hard, the Saudi oil industry would not have been a leader now,” Prince Abdulaziz said in one of the occasions.

Apart from oil diplomacy, who is Prince Abdulaziz? How did his journey begin with oil?

In 1987, Prince Abdulaziz received a call from Minister Hisham Nazer, who had succeeded Sheikh Ahmed Zaki Yamani in late 1986. He asked him to join him in the ministry.

“I was very happy when the minister called me, but I was on vacation,” Prince Abdulaziz said. “I was newly married at the time and hesitated a lot to end my vacation and join the minister. But I found all the support from my wife and decided to cut off the leave and join the delegation,” he recounted.

Before joining the ministry, the prince was active in the academic world. He lived in the Eastern Province, where he headed the Department of Economic and Industrial Studies at King Fahd University of Petroleum and Minerals in Dhahran.

Prince Abdulaziz’s career in the ministry began in 1987 as an adviser to the minister, a position he held until 1995 when he was appointed as Undersecretary for Petroleum Affairs. In May 2004, a royal order was issued appointing him as senior assistant minister of petroleum affairs. He remained in office until he became deputy minister and then minister of state for energy.

Prince Abdulaziz is also an active member of the Board of Governors of the Oxford Institute for Energy Studies in Britain and the International Association for Energy Economics in Washington, DC.



What Happens When Russian Gas to Europe Via Ukraine Stops?

A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
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What Happens When Russian Gas to Europe Via Ukraine Stops?

A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo

Austria's energy company OMV was informed by Gazprom that the Russian gas producer would halt deliveries of natural gas via Ukraine to OMV from 0500 GMT on Nov. 16 following OMV winning an arbitration case. Supplies of Russian gas to Europe via Ukraine may completely stop from Jan. 1 2025 after the current five-year deal expires as Kyiv has refused to negotiate the new terms of the transit with Moscow during the war.
Here is what happens if Russian gas transit via Ukraine is completely turned off and who will be affected most, according to Reuters.
HOW BIG ARE THE VOLUMES?
Russian gas supplies to Europe via Ukraine are relatively small. Russia shipped about 15 billion cubic meters (bcm) of gas via Ukraine in 2023 - only 8% of peak Russian gas flows to Europe via various routes in 2018-2019.
Russia spent half a century building its European gas market share, which at its peak stood at 35%.
Moscow lost its share to rivals such as Norway, the United States and Qatar since the invasion of Ukraine in 2022, prompting the EU to cut its dependence on Russian gas.
EU gas prices rallied in 2022 to record highs after the loss of Russian supplies. The rally won't be repeated given modest volumes and a small number of customers for the remaining volumes, according to EU officials and traders.
UKRAINIAN ROUTE
The Soviet-era Urengoy-Pomary-Uzhgorod pipeline brings gas from Siberia via the town of Sudzha - now under control of Ukrainian military forces - in Russia's Kursk region. It then flows through Ukraine to Slovakia.
In Slovakia, the gas pipeline splits into branches going to the Czech Republic and Austria.
Austria still receives most of its gas via Ukraine, while Russia accounts for around two-thirds of Hungary's gas imports.
Slovakia takes around 3 bcm from energy giant Gazprom per year, also about two-thirds of its needs.
Czech Republic almost completely cut gas imports from the east last year, but has started taking gas from Russia in 2024.
Most other Russian gas routes to Europe are shut including Yamal-Europe via Belarus and Nord Stream under the Baltic.
The only other operational Russian gas pipeline route to Europe is the Blue Stream and TurkStream to Türkiye under the Black Sea. Türkiye sends some Russian gas volumes onward to Europe including to Hungary.
WHY DOES THE UKRAINIAN ROUTE STILL WORK?
While remaining Russian gas transit volumes are small, the issue remains a dilemma for the EU. Many EU members such as France and Germany have said they would not buy Russian gas anymore but the stance of Slovakia, Hungary and Austria, which have closer ties to Moscow, challenges the EU common approach.
The countries, who still receive Russian gas, argue it is the most economic fuel and also blame neighboring EU countries for imposing high transit fees for alternative supplies.
Ukraine still earns $0.8-$1 billion in transit fees from Russian gas transit. Russia earns over $3 billion on sales via Ukraine based on an average gas price of $200 per 1,000 cubic meters, according to Reuters calculations.
Russia's gas pipeline export monopoly Gazprom plunged to a net loss of $7 billion in 2023, its first annual loss since 1999, because of the loss EU's gas markets.
Russia has said it would be ready to extend the transit deal but Kyiv has repeatedly said it won't do it.
Another option is for Gazprom to supply some of the gas via another route, for example via TurkStream, Bulgaria, Serbia or Hungary. However, capacity via these routes is limited.
The EU and Ukraine have also asked Azerbaijan to facilitate discussions with Russia regarding the gas transit deal, an Azeri presidential advisor told Reuters, who declined to give further details.