RIYADH (Reuters) – President Xi Jinping told Gulf Arab leaders on Thursday that China would encourage them to buy oil and gas in the yuan. .
President Xi Jinping speaks in Saudi Arabia and Crown Prince Mohammed bin Salman has hosted two “landmark” Arab summits with Chinese leaders.
Largest oil exporter Saudi Arabia and economic powerhouse China send strong messages during Xi’s visit on ‘non-interference’ at a time when relations with Riyadh and Washington are being tested over human rights, energy policy and Russia. sent.
Saudi Arabia’s move to ditch the dollar in oil trade would be a dramatic political move.Riyadh has previously threatened to face US law that could expose OPEC members to antitrust lawsuits. .
China’s growing influence in the Gulf has unsettled the United States. The deepening economic ties were touted during Xi’s visit, greeted with pomp and ceremony, as he met with Gulf states on Friday and attended a broader summit with leaders of the Arab League countries across the Gulf, Levant and Africa. did.
At the beginning of Friday’s talks, Prince Mohammed announced a “historic new phase in our relationship with China”, which President Joe Biden attended at a small Arab summit in Riyadh on May 5. This contrasts with the awkward U.S.-Saudi talks a month ago.
Asked about the country’s relationship with Washington in light of the enthusiasm shown by President Xi Jinping, Foreign Minister Faisal bin Farhan Al-Saud said Saudi Arabia will continue to work with all partners. “We don’t see this as a zero-sum game,” he said.
“I don’t believe in polarizing or choosing one or the other,” the crown prince said at a press conference after the meeting.
Saudi Arabia and China have signed several strategic and economic partnership agreements, but analysts say the relationship is largely fueled by energy interests, despite Chinese companies’ forays into the technology and infrastructure sectors. said that
“Energy issues will continue to be at the center of the relationship,” Robert Mogielnicki, a senior resident fellow at the Arab Gulf Studies Institute in Washington, told Reuters.
[1/4] Saudi Arabia’s Crown Prince Mohammed bin Salman stands with Chinese President Xi Jinping in Riyadh, Saudi Arabia, December 8, 2022.Handout via Saudi Press Agency/Reuters
“The Chinese and Saudi governments are also looking to help their champions and other private sector actors advance trade and investment deals. raises concerns.”
Saudi Arabia this week agreed a memorandum of understanding with Huawei to build a cloud computing and high-tech complex in Saudi Arabian cities. The Chinese tech giant is participating in building 5G networks in the Gulf countries despite US concerns over possible security risks when using its technology.
natural partner
Saudi Arabia and its Gulf allies have defied US pressure to limit trade with China and cut ties with fellow OPEC+ oil producer Russia over its aggression in Ukraine.
Riyadh is China’s largest oil supplier, and the two countries in a joint statement reaffirmed the importance of global market stability and energy cooperation, encouraged non-oil trade, and strengthened cooperation in peaceful nuclear power generation. striving
Xi said Beijing will continue to import large amounts of oil from the Gulf Arab countries and expand liquefied natural gas imports, adding that these countries are natural partners for further cooperation in upstream oil and gas development. rice field.
He also said that China will “make full use of the Shanghai Oil and Gas Exchange as a platform for renminbi settlement for oil and gas trade.”
Beijing has lobbied for the renminbi to be used for trading instead of the US dollar.
A Saudi source told Reuters before Xi’s visit that the decision to sell a small amount of oil to China for the renminbi makes sense to directly pay for imports from China, but ” It’s not the right time yet,” he said.
Most of Saudi Arabia’s assets and reserves are denominated in dollars, including more than $120 billion of US Treasuries held by Riyadh, and the Saudi Riyal, like other Gulf currencies, is pegged to the dollar.
Earlier, the Chinese leader said his visit ushered in a new era in relations, and said the Arab summit would be “a milestone in the history of China-Arab relations”. expressed a desire to
Additional reporting by Eduardo Baptista in Beijing, Riham Alkousaa, Ahmad Ghaddar and Lina Najm in Dubai Writing by Ghaida Ghantous and Dominic Evans Editing by Mark Heinrich, William Maclean and Mark Potter
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