An oil production cut by Saudi Arabia and its allies demonstrated how Crown Prince Mohammed bin Salman is willing to set aside U.S. concerns to pursue a nationalist energy policy aimed at funding an expensive makeover of his kingdom
DUBAI—.
Prince Mohammed told associates late last year that he was no longer interested in pleasing the U.S., saying he wants something in return for anything he gives Washington, according to people familiar with the conversation. “The Saudis have to guard against downside scenarios” of global recession and the implications for energy demand, which could drive oil prices below a yearly average of $80 a barrel and create a budget deficit, he said.
Before previous production cuts announced in October, Saudi officials said they believed economic data indicated that the government budget required $90 to $100 a barrel for Brent crude, above the $75 to $80 range the kingdom was targeting. With around $450 billion in foreign reserves and the world’s second-largest proven oil reserves, Saudi Arabia is unlikely to run out of money soon.
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