As tensions persist between Russia and Ukraine, former President Donald Trump is advocating a new approach to address the ongoing conflict. Focusing on Russia's primary revenue source—oil—Trump suggests that reducing oil prices could be pivotal in forcing Moscow to reconsider its actions in Ukraine.
During his recent interactions, Trump emphasized the role of OPEC+, a coalition of oil-producing nations, in easing the Ukraine war through economic pressure. He believes that compelling OPEC+, particularly Saudi Arabia, to decrease oil prices could significantly diminish Russia's profits, making it harder for the country to finance its military pursuits. Trump stated, One way to stop it quickly is for OPEC to stop making so much money.
Despite Trump's confidence, experts caution that convincing OPEC+ to cut oil prices won't be straightforward. Recent decisions by the alliance to maintain current production levels indicate their caution in response to global economic conditions. Continuing his diplomatic efforts, Trump addressed the issue at the World Economic Forum in Davos, Switzerland, underscoring the potential impact of $45 per barrel oil prices on Russia's economy.
The intricate relationship between Russia and OPEC+, particularly with Saudi Arabia, complicates Trump's plan. Since 2016, non-OPEC countries, including Russia, have collaborated with OPEC members to stabilize the market amidst challenges from U.S. shale oil. While Trump maintains strong ties with Saudi Crown Prince Mohammad bin Salman, analysts like Patrick De Haan of GasBuddy note that the Saudis have their financial responsibilities, labeling Trump's request as a huge ask.
The Kremlin remains unconvinced of the effectiveness of this strategy, with spokesperson Dmitry Peskov asserting that the conflict is rooted in national security issues rather than oil economics. Furthermore, the U.S. and its allies' efforts to cap Russian oil at $60 per barrel have seen mixed results, as buyers like China and India continue to support Russian oil at discounted rates.
Trump's recent outreach to the Saudi Crown Prince signaled his ongoing commitment to reshaping the geopolitical landscape, hoping to foster stronger U.S.-Saudi relations that could eventually favor his broader strategy. However, the Crown Prince's announcement of a $600 billion investment in the U.S. over the next four years—while significant—falls short of Trump's ideal $1 trillion target.
There's a historical precedent of difficulty in navigating the intricacies of OPEC+ decisions, as evidenced by President Joe Biden's earlier efforts to increase global oil supply. Despite Trump's assertions of success where Biden faced setbacks, industry experts like Kevin Book suggest that aligning OPEC+ is inherently complex and contingent on various political and economic factors.
Trump's pledge to quickly end the Ukraine conflict remains a focal point of his political narrative. He contrasts his approach with the existing administration's support for Ukraine's military efforts, reiterating his preference for economic and diplomatic solutions over extended warfare. His cooperation with global leaders, such as a potential meeting with Russian President Vladimir Putin, underscores his desire to prioritize geopolitical stability over conflict escalation.
Moving forward, Trump's strategy will likely involve negotiating intricate international alliances, leveraging economic tools to support U.S. foreign policy objectives and bringing an end to the devastating Ukraine conflict. Whether his efforts will produce tangible results remains to be seen, but it highlights an ongoing dialogue on innovative solutions in global diplomacy.