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Trump to send special envoy to Riyadh to stabilise oil market

March 24, 2020 at 1:23 pm

US President Donald Trump delivers a speech during the Arabic Islamic American Summit in Riyadh, Saudi Arabia on May 21, 2017 [Bandar Algaloud / Saudi Kingdom Council / Handout/Anadolu Agency]

US President Donald Trump has appointed a special energy envoy to Saudi Arabia, as the global oil industry confronts what analysts say is the worst crisis for the industry in a hundred years. Victoria Coates is one of Trump’s longest-serving security aides, who moved from the White House in February to become a senior adviser to Energy Secretary Dan Brouillette.

Coates will be given the mammoth task of finding a compromise solution to the crisis triggered by the slump in demand due to the coronavirus pandemic and Riyadh’s decision to increase oil production following the collapse of a deal with Russia earlier this month. Trump expressed his intention last week to get involved in the oil price war between Riyadh and Moscow at an appropriate time, saying that low oil prices are good for US consumers even as they hurt the industry.

“Coates will be based in Saudi Arabia to ensure the Department of Energy has an added presence in the region,” Reuters reported a US official as saying. “While her assignment comes at a pivotal time for global oil markets, it has been in the works for a while.” Her start date is unknown due to the coronavirus outbreak.

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Trump has said that he wants a compromise position on the oil price crash. Despite playing down the crisis with his “good for US consumers” comment, the slump threatens to bankrupt many American companies which will struggle to produce oil at such a low price. With low production costs, Saudi crude can remain profitable even at current prices, which is not the case for the Americans.

Coates is expected to work in Saudi for a number of months, at least, alongside US State Department officials and energy attachment Scott Hutchins.

Brouillette is reported as saying that the Trump administration will launch a diplomatic campaign to stabilise energy markets. Speaking to Bloomberg TV yesterday, he said that the establishment of an American-Saudi oil alliance was among “many ideas” discussed, but no decisions were made on “anything like this.”