Trump Urges Saudi Arabia And Russia To End Oil War
NOEL KING, HOST:
President Trump has inserted himself into a fight between two strong men who he's been on friendly terms with. Last week, he talked separately to the crown prince of Saudi Arabia, Mohammad bin Salman, and to Russian President Vladimir Putin. He urged them to end an oil war that's driving prices down to their lowest point in 20 years. It's devastated the oil industry including in the United States. Here's President Trump talking last week.
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PRESIDENT DONALD TRUMP: I think they both want to make a deal. And they're both smart. They love their countries. They want to make a deal. It's good. But it's also good for the world if they do 'cause you save an industry.
KING: NPR's Jackie Northam has been following developments on this one. Good morning, Jackie.
JACKIE NORTHAM, BYLINE: Good morning, Noel.
KING: What started the oil price war between Saudi Arabia and Russia?
NORTHAM: Right. It started in early March at an OPEC meeting which included Russia. And at that time, oil prices were falling and Saudi Arabia was pressing Moscow to decrease production to try and lift the price. And Russia refused. From all accounts, tempers flared and Russians stormed out of the meeting. And Saudi Arabia said, fine and in a complete reversal of what it was after decided it was going to turn the taps on full. And since then, the market has been flooded with crude. I spoke with Ellen Wald, and she's author of "Saudi, Inc." And she says there's now a standoff between the two countries.
ELLEN WALD: At least for the first couple weeks in March, seemed like it was a battle of wills and who's going to blink first. But in between that and today, demand fell off a cliff. Global oil demand just died.
NORTHAM: And Noel, that's because of the coronavirus. People have stopped driving and flying, and industries have gone quiet. And you know, you would think that would be enough to call a halt to this spat, but it hasn't. Saudi Arabia and Russia have been exchanging barbs. They're blaming each other for the crisis. And meanwhile, Saudi Arabia, in particular, is still pumping historic amounts of oil.
KING: And when this first happened, President Trump said, look - this is good for the U.S; this fight between these two countries will mean cheaper gasoline here. But then last week, he tweeted that he wants to try and get Saudi Arabia and Russia to resolve the situation. So why is he getting involved?
NORTHAM: Well, the price of crude is so low now that it's really hurting the shale industry here in the U.S. And you know, many companies are facing bankruptcy, and thousands of jobs could be lost. So Trump has been pushing Putin and Crown Prince Mohammed bin Salman to come to an agreement. I spoke with Jim Krane, and he's an energy expert at Rice University. And he said this is a tough situation to untangle because you're dealing with three very powerful and oversized personalities.
JIM KRANE: You've got, you know, the ego trio here. I mean, you've got, you know, Putin and Mohammed bin Salman and Donald Trump - you know? - I mean, all - the top three oil-producing countries, you know, who are involved in this bizarre showdown - this virus raging around the world. It's a real weird situation.
NORTHAM: And Noel, while you've got these ultralow oil prices - you know, they're not good - neither Putin nor the Saudi crown prince wants to look like they're backing down.
KING: So is there anything President Trump can do to get what he wants?
NORTHAM: Well, Trump says he's willing to impose tariffs on Saudi Arabia and Saudi and Russian oil. He's indicated he wants production cut by about 15 million barrels a day, but that seems highly unlikely. There's hope that something will come of this virtual OPEC+ meeting tentatively scheduled for Thursday. So maybe the three sides can come to some agreement, but it's just not certain yet.
KING: OK. NPR's Jackie Northam. Thanks so much, Jackie.
NORTHAM: Thank you.
(SOUNDBITE OF BERRY WEIGHT'S "YETI'S LAMENT") Transcript provided by NPR, Copyright NPR.