Russia’s Middle East Energy Diplomacy

How the Kremlin Strengthened Its Position in the Region

Russian President Vladimir Putin welcomes Saudi Deputy Crown Prince and Defence Minister Mohammed bin Salman during a meeting at the Kremlin in Moscow, Russia, May 2017.  Pavel Golovkin / REUTERS

When the United States and the European Union decided, in March 2014, to impose sanctions against Russia in the wake of the Ukraine crisis, they attempted to target a key proxy of Russian geopolitical influence: its energy sector. Part of the sanctions’ sting came from complicating Russian energy project finance deals and increasing the level of risk attached to Russian debt. In response, the Kremlin attempted to build new energy-financing channels and export markets. Its first inclination was to turn to the fast-growing energy consumers in Asia, with a particular focus on China. In addition to negotiating a May 2014 deal for Russia’s Gazprom company to supply up to 38 billion cubic meters of gas to China National Petroleum Corporation for 30 years, China became a source of loans for oil and liquefied natural gas (LNG) projects aimed at its market.

Progress on Russia’s eastern gas strategy since then has been sluggish, however, mainly because of China’s slowing growth and its ability to exploit its strong bargaining position relative to Russia, whose eastern hydrocarbon assets are stranded owing to a lack of readily available markets. As a result, the Kremlin has turned its foreign policy strategy back to an old Soviet source of geopolitical influence—the Middle East. The United States’ decision to abandon its role as regional underwriter in chief over the course of Barack Obama’s second presidential term, as evidenced by a series of U-turns on Syria and the decision to indirectly support a regional rebalancing of power between Saudi Arabia and Iran following the lifting of nuclear sanctions in 2016, has allowed the Kremlin to claim a stake in the Middle East’s conflict hot spots, as well as to insert its energy sector at the heart of the region’s oil and gas markets. 


The May 2017 rollover of an agreement between OPEC and non-OPEC countries to restrain production in an attempt to bolster oil prices has brought Russia, as the largest non-OPEC producer, together with Saudi Arabia, as

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