To the oil prices, and might they never go up – or down?
The United States needed Russian support to conclude the Iranian nuclear deal. As U.S. President Barack Obama acknowledged, “we would have not achieved this agreement had it not been for Russia’s willingness to stick with us.” But with U.S.-Russian relations at their lowest point since the end of the Cold War, Russian support came as somewhat of a surprise, even to Obama. So, why was Russia willing to support an Iran deal that even the normally anti-American Russian media describes as Obama’s personal achievement?
As usual, the answer is far from simple and resides ultimately in the fevered mind of Russian President Vladimir Putin. Russian support for the negotiation process with Iran has been inconsistent and overall demonstrates some mixed emotions. From a narrow Russian perspective, the deal threatens to create yet another steady stream of oil and gas onto the world market at a time when depressed energy prices are already threatening the Russian economy. With that disadvantage in mind, the deciding factor was likely the Chinese one. The Chinese wanted the deal for their own reasons and Vladimir Putin, for all of his bluster, is in no position to resist them.
Read more in the Brooking’s Order from Chaos blog, July 21.