Tag: opec

Some of Wall Street’s top CEOs spent the last week on a diplomatic mission to ­Saudi Arabia. It wasn’t touted as diplomacy, of course. The financiers who attended the Future Investment Initiative in ­Saudi Arabia, known as “Davos in the Desert,” are a well-scripted bunch who prefer to keep their dealings private whenever possible.

Tough luck. Word leaked to me that what went down was vastly more important than seminars on climate change or whatever else the globalist crowd likes to virtue-signal about.

Rather, I am told by people with knowledge of the matter that the real reason so many top CEOs attended the conference was to forge a truce between the Saudis and the Biden administration. The ongoing and very public bellicosity between the two longtime allies is bad for business, both the CEOs’ and that of the US.

True, Saudi Arabia is a big Wall Street client looking to further modernize its economy through investment-banking deals, while it turns to our financial sector to manage its riches. But the growing consensus among the people who run the US financial system is that having the Saudis as an enemy is among the biggest geo­political and economic mistakes of the mistake-prone Biden administration.

It will embolden the aims of our common enemy, the terrorist regime in Iran, and drive the Kingdom further into the hands of our rivals, Russia and especially China. (Reps from China flooded the conference this year, I am told, and not because they like the desert heat). Plus the bickering will do nothing to satisfy our ­energy needs and save Sleepy Joe Biden’s presidency.

For the unacquainted, what goes down in Riyadh every year for ­almost a decade is very similar to the more established World Economic Forum confab in Davos, Switzerland. Running the show in Riyadh is a more controversial host than milquetoast globalist WEF chief Klaus Schwab.

It’s the crown prince, Mohammed bin Salman — known by haters and admirers alike as MBS. When MBS (now just 37) became the Kingdom’s de facto ruler a few years ago, he was in charge of a country with enormous oil wealth and vast economic potential.

Uneven record

He was also in charge of maintaining the somewhat uncomfortable relationship with us because of his country’s often lousy record on human rights. There were hopes the youthful new leader would enact reforms, soften the Kingdom’s anti-Democratic impulse and modernize its economy away from its reliance on crude.

Let’s just say it hasn’t gone down exactly that way. The crown prince instituted some much-needed changes, such as expanding women’s rights. The Kingdom’s giant oil company, Saudi Aramco, is venturing beyond fuel into areas such as tech. The Saudis have continued to support Israel’s existence, albeit tacitly, and remain an enemy of Iran.

MBS also put a slew of people he deemed potential rivals under house arrest immediately after taking control. Then presidential candidate Biden campaigned in 2020 to make Saudi Arabia a “pariah” nation because the Kingdom hasn’t shed its autocratic leanings, and because MBS is widely blamed for the assassination of a journalist critical of his regime, Jamal Khashoggi.

More recently, tensions have gone from bad to worse after our feeble leader sought to cut domestic oil production, traveled to the Middle East and begged the crown prince to increase supply. Biden thought he had a deal until MBS and OPEC announced cuts, prompting the administration to threaten sanctions and maybe more.

OK, I know what you’re saying: This MBS is a bad dude. Wall Street likes him only for his money, his control of Saudi Aramco and the massive state pension fund. Both are growing gushers of investment-banking and money-management fees for the likes of Goldman Sachs, JPMorgan, BlackRock etc. — the very same type of people who are telling the White House to back off.

Point taken, but the fat cats who went to Riyadh (JP’s Jamie Dimon, Goldman’s David Solomon, reps for big private-equity and money-management firms) are also saying the world is filled with bad actors. The Saudis are probably the best — and most strategically important — of the bunch.

It’s a geopolitical reality that the Trump administration and prior presidents have accepted, but the progressive zealots currently in charge of Team Biden won’t.

It’s also foolhardy. Biden’s scorched-earth approach to MBS is hurting the American consumer and the country’s national-security interests, and Wall Street executives make the point both to me and their contacts in the White House that our time would be better spent completing pipelines if we really want to lower the cost of fuel here at home.

On top of all that, the recent spat over oil production may not be the one-sided affair the White House and Dems are claiming. In private meetings with CEOs, the Saudis contend the oil-production cut was well-telegraphed no matter what Biden may have thought after his famous fist bump with MBS in July.

‘No choice’ on supply

OPEC’s move is a function of a long-standing desire to keep ­prices from falling below $80-$90 a barrel. Because Biden keeps releasing oil from the Strategic Petroleum Reserve and with the world economy falling into recession, the Saudis say they had no choice but to cut supply.

If the White House didn’t know that, Sleepy Joe must have been half-asleep during those talks, the Saudis say.

These are all points made by senior Wall Street executives to people in the Biden administration in recent days, I am told. The Wall Streeters get that MBS is no saint, but Sleepy Joe’s weak hand makes the crown prince a necessary evil. Biden should take their advice and focus on some real enemies.