Venezuelan President Nicolas Maduro is set to shortly arrive in Moscow as part of the Energy Efficiency and Energy Development International Forum which is held during Russian Energy Week. The event brings together the CEOs of top oil and gas companies, as well as minsters and heads of state from prominent energy producing nations.
Later this week, Saudi Arabia’s King Salman will meet with President Putin, in an historic visit for a Saudi monarch. Saudi Arabia and Russia have already confirmed a $1 billion bilateral investment fund in another historic first.
While the world’s eyes have been focused on the rapidly expanding relationship between traditional US ally Saudi Arabia and Russia, few are discussing the Maduro-Putin meeting which is also to take this week.
Venezuela recently made the decision to price its oil in Chinese Yuan, in a move designed to undercut recent US sanctions on Venezuela, sanctions which targeted President Maduro personally as well as the country’s economy as a whole.
Venezuela’s decision came shortly after the recent BRICS summit in Xiamen where moves were made to facilitate the creation of a BRICS trading currency as well as a BRICS crypto-currency. Prior to the BRICS summit, China announced that it will begin issuing oil futures contracts in gold backed Yuan.
Furthermore, during a bilateral meeting between the Presidents, ministers and business leaders of Russia and China in July of this year, both countries expressed their readiness to begin trading in local currencies, in a further blow to US Dollar hegemony.
As a leading oil producer and OPEC member, Venezuela has an important role in a world economy that is increasingly losing its dependence on the Dollar. Furthermore, as the OPEC member which along with Iran has been targeted most heavily by US sanctions, Venezuela has a uniquely pressing interest in expanding the avenues of global trade based on a new currency standard.
In this sense, by targeting Russia, Iran and Venezuela simultaneously with unilateral sanctions, the US has helped to create an economic alliance of convenience between the three countries which will clearly have far reaching implications for much of the world.
By meeting the leaders of Venezuela and Saudi Arabia, among others, during the same week, Russian President Vladimir Putin is sending a clear message to the wider world: Russia is open for business with any willing partner and furthermore, there is no ideological component to the Russian business model. Russia has and continues to deal with countries on issues of trade, irrespective of wider geo-political alignments.