Saudi Arabia warned G7 nations not to seize Russian assets, gave debt sale threat: Report

Saudi Arabia “warned” G7 nations that it mightsell off someof the European debt holdings if the group decides to seize all $300 billion of foreign exchange of Russia, reported Bloomberg.

The probable move by G7 nations was seen as support to Ukraine in the ongoing war against Russia. Saudi Arabia’s Crown Prince Mohammed Bin Salman launched a veiled threat to one of the most powerful groups of nations, showcasing the Saudi’s growing diplomatic clout on the world stage.

The warning by Mohammed Bin Salman is being seen as a major balance of power in the Ukraine-Russia war, which has almost led to the isolation of Russia by the Western countries.

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The Saudi finance ministry’s opposition is said to have played a role in shaping the G7’s ultimate decision to tap only the profits generated by the frozen assets, rather than seizing them entirely.

Saudi Arabia’s intentions remain unclear

The actual intentions behind Saudi Arabia’s warning to G7 remain unclear. However, there is speculation that Riyadh was driven by self-interest, fearing that such a seizure might set a dangerous precedent for other countries in the future.

Some experts also see this as Saudi Arabia’s solidarity with Russia, given the close ties that Riyadh has maintained with Moscow amid the ongoingwar in Ukraine, including their joint leadership of the OPEC+ oil cartel.

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The incident is also seen as Riyadh’s way of swaying BRICS nations, in order to become a member of the group, Bloomberg reported. The report noted that asthese countries gain economic and diplomatic strength, they are increasingly able to challenge and shape global policy decisions that were once primarily dictated by Western nations.

The Saudi position on seizing Russian foreign assets also reflects a broader trend where issues like the Ukraine conflict are becoming a problem between the West and other nations. Much similar to how the ongoing Israel-Hamas war in Gazahasbecome a point of contention among world leaders of various nations, and it is no longer just aregionalissue.

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The Saudi threat also serves as a stark reminder of the Kingdom’s significant financial leverage. With net foreign reserves of $445 billion and a sovereign wealth fund approaching $1 trillion in assets, Saudi Arabia’s financial decisions can have far-reaching implications for global markets and geopolitics.

Ultimately, the G7 and EU agreed to a financial structure that will provide Ukraine with about $50 billion of fresh aid, using the profits generated by Russia’s blocked funds. The compromise solution reflects the delicate balancing act that Western powers must now perform, as we move towards a more multipolar world.

(With inputs from agencies)