Will
The $40 Billion Saudi Infrastructure Gift Influence Trump by Tyler Durden Authored by Zainab Calcuttawala via OilPrice.com, It�s �Infrastructure Week� in Washington,
and foreign powers are taking note. Ahead of President Donald Trump�s upcoming
visit to the Middle East, Saudi Arabia has promised to make $40 billion of its sovereign
wealth fund available to the United States to bankroll part of the roughly $1 trillion
in infrastructure improvements that Trump promised on the campaign trail. The move is reminiscent of the KSA�s strategy
amongst its allies in the Gulf Cooperation Council (GCC), as well as Morocco and Jordan. This GCC + 2 group of kingdoms is regularly
showered with billions of dollars in gifts from its wealthiest members, earmarked for
similar construction projects, allowing the most stable Arab countries to remain intimately
connected through financial obligations. The monarchial structure of these countries
allows the lead executive to accept the sizeable donations without much fuss from the public. It�s just the way things are done there,
and citizens of those regions generally accept. But using foreign funds, especially those
from a country such as Saudi Arabia – which only garnered favorable reactions from 31
percent of Americans polled by Gallup in February 2017 � could be another political trap for
Trump. The KSA had gone all-in on Hillary Clinton
before the election, expecting her to continue to tweak policies put in place by Barack Obama. Contributions from GCC nations, especially
Saudi Arabia, to the Clinton Foundation total in the millions. Reports of the serial grand donations made
voters question Clinton�s allegiances in the 2016 elections. Trump could suffer a similar loss in faith
if he begins accepting funding from monarchies willy-nilly � though censuring the new commander-in-chief
in the media for any questionable action has led to fierce resistance from the White House
and far right. Riyadh�s most recent $40 billion gift is
an effort to court support in the Trump administration, especially as the Saudi Aramco IPO approaches
next year. Deputy Crown Prince Mohammed Bin Salman met
Trump at the White House in the early days of the new administration. Local media took to labelling the trip a �historic
turning point� in bilateral relations � a marked shift from rumors regarding friction
between the two countries during Obama�s tenure. Nonetheless, the Department of Defense continued
to approve the KSA�s weapons orders for use in Yemen and other regional squabbles,
and Trump will likely continue that legacy. The new president has already declared his
support for a new U.S.-Saudi program with $200 billion in direct and indirect investments
over the course of his presidency for use in technical development in the energy sector
and other advancements in financial relationships between the two countries. As Zero Hedge pointed out earlier this week,
it would be ironic if the Saudi funds used for energy research end up discovering new
ways to lower shale extraction costs for American producers. Saudi Arabia, the largest producer in the
Organization of Petroleum Exporting Countries (OPEC), has led a vociferous effort to deter
additional shale production, particularly from the Permian Basin. The modest jump in oil prices seen after OPEC
agreed on a 1.2 million bpd cut allowed hundreds of rigs in the U.S. to reactivate, causing
barrel rates to tumble as Libya and Nigeria also tallied rising outputs. Riyadh needs a strong barrel price to guarantee
a hefty valuation for Aramco ahead of the IPO, which is why it announced that the nation
would extend its cuts through March 2018. Saudi Arabian clout in the oil community would
take a hit if the plan to rebalance supply fails over the next few months. There�s nothing Trump can really do about
shale production. Unlike oil-rich countries in the Gulf, Africa,
and South America, where nationalized oil companies are the norm, the U.S. oil sector
is highly privatized. The CEOs of ExxonMobil, Chevron, and the hundreds
of other oil companies active in the country reserve the right to decide when to drill
and when not to drill. On top of that, Trump�s campaign vow of
unleashing exploration and extraction prospects in the U.S. makes it unlikely that the White
House would use regulatory power to curtail future fossil fuel development. Carving out a niche in the new administration
looks to be an uphill battle for Saudi Arabia.

Will The $40 Billion Saudi Infrastructure Gift Influence Trump
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5 thoughts on “Will The $40 Billion Saudi Infrastructure Gift Influence Trump

  • May 20, 2017 at 6:32 pm
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    Nobody better to negotiate for us. Our President who loves AMERICA. MAKING AMERICA GREAT AGAIN… Blessings to our Arabian Friends…<3

    Reply
  • May 20, 2017 at 6:41 pm
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    well that's money for the wall

    Reply
  • May 20, 2017 at 7:14 pm
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    Put $10billion towards the wall.

    Reply
  • May 20, 2017 at 7:24 pm
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    40 billion to manipulate gas prices back to 4 to 5 dollars a gallon. What a deal! Only not for u.s. drivers

    Reply
  • May 20, 2017 at 7:43 pm
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    He should use some money for extra protection all around him.

    Reply

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