Russian geopolitical objectives in the current oil price crisis, and implications for Canada

  • Sergey Sukhankin

Abstract

Following the end of unsuccessful negotiations in March 2020 at OPEC headquarters in Vienna regarding oil production cuts,  in the early March in Vienna (headquarters of OPEC), Russia and Saudi Arabia de-facto launched a prise war that resulted in a significant drop in oil prices (just as the COVID pandemic caused a concomitant drop in demand for oil), which in turn led to earthquake on the global oil market. As a result, prices of oil that plays an essential role for economies of both countries have plummeted to  record lows no seen in two decades. While suffering economic losses,  both countries, nevertheless, maintain an assertive posture and seem willing to pursue this policy even further. This paper examines the geopolitical logic of the Russian side – a country that has been placed under western economic sanctions since 2014 as a result of its illegal annexation of Crimea and destabilizing steps via proxy forces in the Southeastern Ukraine – and consequences thereof, particularly for Canada, as the price of Western Canada Select reached historic lows amidst a COVID-19 induced economic contraction.   

Published
2020-05-13
Section
Briefing Papers