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Zarnab Shaheen
The world biggest exporter of Oil, the kingdom of Saudi Arabia holds a great deal of
significance on the world map. The country has a unique strategic location in the Middle East of being bordered by the Arabian Gulf and surrounded by the Red Sea to the West (General
Authority of Statistics, 2022) . Saudi Arabia enjoys a favorable trade every year by exporting
onerous amount of petroleum and gas to the World. Two of the main export destinations of the Saudi products include China and the USA. The country exported products mainly oil to China worth (33.4B) and USA worth (7.33B) within 2022 (OEC World, 2020) . The oil rich kingdom has the inception of its foreign relations mainly because of the onerous exports of its natural resources to the others state.
Holding a pertinent geostrategic position, the Gulf region of Saudi Arabia has always strived to maintain its diplomatic ties with all the countries because of its economic benefits. Republic of China has been a keen recipient of Saudi petroleum products which played a key role in the maintenance of the healthy relations between both the states. Since the conception of the mainland China in 1949, also known as the “People’s Republic of China” stands with a pro communist ideology which is opposed to the USA’s capitalist ideology (T.Y.Wang, 1993) .Firstly, to ensure the survival of the Communist ideology China allied with the great superpower called Soviet Union soon after 1949. However, the relations with the Soviet Union were strained with China when they reached a level of peaceful negotiations with the west in 1956 (T.Y.Wang, 1993) .
Chinese ultimately felt it as a threat to their national security and China rushed to maintain its ties with the third world countries which mainly included the Middle Eastern countries. This pertinent move was deemed necessary at that time because China required the support of other countries to hold a dominant position in the world against the USA’s ideologies (Bakhotmah, 2013) . Among the Middle East, Saudi Arabia seemed to be a fundamental state because of controlling key waterways of the Gulf and providing the crossroads of Asia, Africa and Europe from each of its side (T.Y.Wang, 1993) . Moreover, the vast reserves of mineral and petroleum provided a strong reason to China to establish healthy ties with the Arab Kingdom of Saudi Arabia.
The year 1990, set the benchmark of the beginning of the flourishing relations of the two
countries and till the present day, China has been a keen buyer of the Saudi petroleum products mainly (T.Y.Wang, 1993) . In return China has been exporting Saudi Arabia with the latest arms and ammunition along with USA. Through the Saudi imported petroleum, China is rapidly empowering its industry and infrastructural development which is paving its road to become a global superpower as opposed to USA (Freidin, 2022) . Saudi Arabia continues to reap economic benefits from the export of the oil to China. However, the relations of both the states have strengthened since the US-Saudi relations have taken a setback.
US and Saudi Arabia have always been a close ally as the US has been a keen importer of Saudi petroleum and in return ensures the provision of arms and ammunition to Saudi Arabia to strengthen its military. However, since the birth of the Covid-19 pandemic and followed by the Russian Ukraine war, the oil prices worldwide have become very volatile. As a part of OPEC, Saudi Arabia decide to cut down its oil production because it predicted that oil prices would experience a setback because of changing world order and economic crisis worldwide (Elhamy, 2022) . However, this move is expected to affect USA gravely as its people are already facing the higher prices with respect to oil and gas. Despite USA’s warning of consequences, Saudi Arabia diverted its trade focus towards China. Chinese president Xi Jinping paid a visit to Saudi Arabia on 7 December 2022, to fortify its ties with the oil rich kingdom. Both the state signed agreements to bolster trade between the two countries to foster peace and development. China promised to buy Saudi oil by a greater percentage to wean off the energy crisis it domestically faces and in return Saudi would ensure the purchase of Chinese ammunition and products (FMPRC, 2022) . The trade agreements further stated that the transactions from China to Saudi Arabia would be diverted from dollars to the local currency of Yuan (Dahan, 2022) . As, both the countries found it irrelevant to make the payments by using the currency of the third country outside the transaction.
Referring to the information mentioned above, I analyze that the Saudi-China friendship will raise alarms of menace for the USA as its hegemony would be in the boats of danger. Firstly, China is investing a lot in development projects with the greatest being the Chinese “Belt and Road Initiative” (Road, 2022) . China’s agenda is clearly incorporating the usage of the Saudi procured petroleum into its mega projects that will prove to ease the journey of China to become a global hegemonic superpower. The mega export of petroleum to China will also reap onerous benefits for Saudi Arabia as well. Furthermore, Chinese having a communist alliance would ally with the communist superpower Russia which would pose a major menace for USA as it would be facing two superpowers from the East whose ideologies are divergent to the USA.
Furthermore, the cuts in the Saudi oil export to USA would lead to surge in the oil prices within USA posing further uncertainty for the USA’s republican party to remain in power as they already face backlash to control the commodity prices domestically.
Finally, the transactions in Yuan and Riyal threaten the dollar dominancy as an international reserve currency in the world market. The transactions in the local currencies would lead to a less demand for dollar currency creating a major demand supply gap for dollars in the world market This gap could ultimately result in the devaluation of the dollar in the world market which has maintained a staunch position in the international markets despite facing multiple recessions in the home country. So, USA would have to play strategically and diplomatically in the changing world order to maintain its historically strong hegemony over the world. As after the global covid-19 pandemic and the Russian invasion of Ukraine the world order is taking a shift from the west towards the other superpowers in the East which are rapidly expanding its powers and hegemony all over the world.
References
Bakhotmah, F. A. (2013). Saudi-China Friendship .
Dahan, M. E. (2022, December 10). China's Xi calls for oil trade in yuan at Gulf summit in
Riyadh.
Elhamy, A. (2022, October 14). Saudi Arabia, United States clash over reason for OPEC+ oil
cut.
FMPRC. (2022, December 7). President Xi Jinping Arrives in Riyadh to Attend the First China-
Arab States Summit and the China-GCC Summit and Pay a State Visit to Saudi Arabia.
Freidin, E. (2022, May 10). Saudi Arabia and China: a blossoming friendship. Retrieved from
General Authority of Statistics. (2022). General Information about The Kingdom of Saudi
Arabia.
Kingdom of Saudi Arabia. (2022). Leadership Message.
OEC World. (2020). Saudi Arabia.
Road, B. &. (2022). Belt and Road Initiative to boost Saudi Arabia's economic, social
development, says Saudi minister.
T.Y.Wang. (1993). COMPETING FOR FRIENDSHIP: THE TWO CHINAS AND SAUDI
ARABIA.