Romanian Energy Minister: Saudi Arabia Expedites Global Energy Industry Ambitions

Romanian Energy Minister Virgil Daniel Popescu revealed plans for launching a gas pipeline from Azerbaijan through the Caspian Sea region, using the link between Romania and Hungary to the Central European markets.

This comes at a time the world and Europe face uncertainty regarding the supply of Russian oil and gas amid the Ukraine crisis.

Popescu also affirmed that Saudi Arabia supplies the world with energy and ensures the stability of markets. He also said the Kingdom looks to protect the world from the repercussions of climate disasters and carbon emissions through its green initiatives.

“The Kingdom has decided to adopt a clean strategy, which brings me hope that the phenomenon of climate crises is a race we can win,” Popescu told Asharq Al-Awsat.

“Climate change is the defining crisis of our time, and it is happening more quickly than we feared. This global threat must be confronted by adopting clean energy and zero-carbon strategies, and Saudi Arabia is taking concrete measures to combat the climate crisis,” he added.

Speaking to Asharq Al-Awsat on the sidelines of his visit to Riyadh, Popescu said he is exploring new channels of economic and commercial cooperation with Saudi Arabia.

The minister pointed to Saudi Arabia’s pivotal role in maintaining the global economy and its expanding energy ambitions in terms of securing gas and oil supplies.

He recalled the Kingdom’s regional and global initiatives for building circular carbon economies and fighting climate change. Apart from launching mega green initiatives at home, Saudi Arabia actively participates in international discussions on energy security and offers a helping hand to developing countries.

“The Saudi Green Initiative will contribute to raising global ambitions, as well as demonstrating the Kingdom’s commitment to both combating climate change and protecting the environment,” said Popescu.

“The energy sector is in the process of transition to a carbon-neutral and sustainable long-term economy,” noted the minister, adding that “no region in the world is immune from the devastating consequences of climate change.”

It is noteworthy that Popescu is in Riyadh to participate in the 12th IEA IEF OPEC Symposium on Energy Outlooks.

Assessing Saudi-Romanian cooperation, Popescu confirmed that his country intends to open new paths for enhancing cooperation and exploring ways to collaborate in the energy sector.

This comes to meet the challenges of rising gas prices, address potential interruptions in gas supplies and enhance energy security.

Saudi Arabia is the largest oil producer and exporter in the world, highlighted Popescu, adding that the Kingdom possesses large reserves of natural gas as well.

Its large reserves of natural gas complement renewable resources, providing support and flexibility in the process of green transformation.

Popescu considered Saudi Arabia’s economy as a very attractive destination for investors given its local potential and important investment programs.

The minister pointed to Saudi-Romanian cooperation extending through the Gulf Cooperation Council.

In March 2011, Bucharest and gulf countries signed their first economic cooperation initiative at a joint forum.

Popescu said that over 250 years of combined experience in oil and gas manufacturing give Romania the right means to cooperate with Gulf countries in several fields.

As the world’s largest oil producer, Saudi Arabia plays a different role in the global energy industry, said Popescu, adding that the Kingdom’s policies for producing and exporting oil, gas and petroleum products greatly influence the global energy market and economy.

On his outlook for oil production and pricing, and the challenges facing the sector in 2022, Popescu said that Romania has welcomed the European Commission’s publication of the document for tackling high energy prices with a toolkit for action.

“Romania has put in place a legal framework to protect vulnerable consumers, as well as a mechanism with compensatory measures for families, small enterprises, SMEs, and hospitals, as well as economic challenges for families and businesses,” noted the minister.

European Central Bank President Christine Lagarde renewed her call for economic integration across Europe on Friday, arguing that intensifying global trade tensions and a growing technology gap with the United States create fresh urgency for action.
US President-elect Donald Trump has promised to impose tariffs on most if not all imports and said Europe would pay a heavy price for having run a large trade surplus with the US for decades.
"The geopolitical environment has also become less favorable, with growing threats to free trade from all corners of the world," Lagarde said in a speech, without directly referring to Trump.
"The urgency to integrate our capital markets has risen."
While Europe has made some progress, EU members tend to water down most proposals to protect vested national interests to the detriment of the bloc as a whole, Reuters quoted Lagarde as saying.
But this is taking hundreds of billions if not trillions of euros out of the economy as households are holding 11.5 trillion euros in cash and deposits, and much of this is not making its way to the firms that need the funding.
"If EU households were to align their deposit-to-financial assets ratio with that of US households, a stock of up to 8 trillion euros could be redirected into long-term, market-based investments – or a flow of around 350 billion euros annually," Lagarde said.
When the cash actually enters the capital market, it often stays within national borders or leaves for the US in hope of better returns, Lagarde added.
Europe therefore needs to reduce the cost of investing in capital markets and must make the regulatory regime easier for cash to flow to places where it is needed the most.
A solution might be to create an EU-wide regulatory regime on top of the 27 national rules and certain issuers could then opt into this framework.
"To bypass the cumbersome process of regulatory harmonization, we could envisage a 28th regime for issuers of securities," Lagarde said. "They would benefit from a unified corporate and securities law, facilitating cross-border placement, holding and settlement."
Still, that would not solve the problem that few innovative companies set up shop in Europe, partly due to the lack of funding. So Europe must make it easier for investment to flow into venture capital and for banks to fund startups, she said.

Romanian Energy Minister: Saudi Arabia Expedites Global Energy Industry Ambitions