Saudi Arabia invests $1bn

Saudi Arabia invests $1bn

President Vladimir Putin said on Wednesday that Russian Federation is open to extending the deal to the end of 2018, though he'll wait until nearer the expiry of the existing pact to make a decision.

King Salman reviews an honour guard.

Saudi Arabia's investment in Russian Federation has already amounted to $1 billion, but Russian Federation intends to increase the amount further at least twice.

A Saudi-Russian business forum is also taking place during the King's visit.

"We are not discussing this at this stage".

"Neither power is expected to discuss Iran, although there have been suggestions that they may discuss the ongoing crisis in Syria", said Jameel Ahmad, Vice President and Chief Market Analyst from ForexTime (FXTM) to AMEinfo.

The Kremlin talks between Saudi King Salman and Russian president Vladimir Putin mark a thaw in relations between the countries, which have often been tense since the Cold War times when the kingdom supported Afghan rebels fighting the Soviet invasion in the 1980s.

Russian Federation and Saudi Arabia have helped stabilize crude prices, the minister stated.

That would buffer drillers against losses if the price were to decline, which may spur more US production - partially offsetting the OPEC-led deal to cut supply by about 1.8 million barrels per day (bpd). Total non-OPEC growth could reach as much as 1.4 million barrels a day, he said.

More news: Facebook to hire 1000 people to review ads after Russian buys

The countries also signed a memorandum of understanding to help the kingdom in its efforts to develop its own military industries, a statement from state-owned Saudi Arabian Military Industries said.

Saudi Arabia is a close USA ally and does not have a history of warm relations with Russian Federation. But Russian military success on the ground in Syria has resulted in Saudi Arabia pressuring opposition groups to hold peace talks with Damascus. The sanctions that the West and the United States of America imposed on the Russian oil and gas industry may become a serious problem for Saudi companies that wish to invest in Russian projects.

"That's led to once-plentiful foreign assets being eroded - barring a significant fiscal adjustment, Bloomber Intelligence (BI) Economics estimates the current situation can be sustained for just four years before threatening the currency peg".

Nothing will escape smart leaders when it comes to paving the way for a smooth negotiation process.

Meanwhile the Saudi Al-Arabiya news agency reports Saudi Arabia has agreed to buy a Russian S400 missile defense system.

Saudi Arabia is the country that buys the most U.S. arms and Washington and Riyadh in May announced a US$110 billion deal to sell weapons to Saudi Arabia.

But it's a symbolic gesture on both parts.

The plan to float around 5 percent of Aramco in an initial public offering (IPO) is a centerpiece of Vision 2030, a wide-ranging reform plan to diversify the Saudi economy beyond oil which is being championed by Saudi Crown Prince Mohammad bin Salman. Mr Putin has said the zones are vital for ending the conflict.

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