Saudi Arabia may have influenced the G7’s reluctance to seize $280 billion of Russia’s frozen assets directly.
According to Bloomberg sources, the Saudis hinted they could sell some Eurobonds and French bonds if the G7 tried to punish Russia for its Ukraine invasion by making all of Russia's frozen foreign assets available for Ukraine's defense and reconstruction.
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One source familiar with the matter described it as a veiled threat.
“No such threats were made,” the Saudi finance ministry told Bloomberg however. “Our relationship with the G-7 and others is of mutual respect and we continue to discuss all issues that promote global growth and enhance the resilience of the international financial system.”
Bloomberg also referenced a Saudi official who said “it wasn’t the government’s style to make such threats.”
The total amount of the kingdom’s holdings of Eurobonds and French bonds may amount to tens of billions of euros, Bloomberg wrote. While that might not have made the difference alone – other countries could have followed the Saudis' lead, Bloomberg reported.
During discussions on Russian frozen assets in May and June 2024, the US and the UK pushed the G7 to consider bolder options, including a direct seizure.
However, the G7 eventually agreed to provide Ukraine with just $50 billion from Russia's frozen assets.
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The seven member nations and the European Union agreed to provide Ukraine with loans from the profits generated by Russia’s €260 billion ($280 billion) of blocked Russia’s central bank reserves, most of which sit in Belgium.
The French Treasury did not respond to Bloomberg with a comment. It's unclear whether Saudi Arabia acted with self-interest or in solidarity with Russia – Russian and Saudi leaders have maintained close relations since Russia began its full-scale invasion of Ukraine, and together they lead the OPEC-plus cartel of oil producers.
Meanwhile, the kingdom has simultanously been trying to build closer relations with Ukraine. President Volodymyr Zelensky traveled to Riyadh last month to meet with Crown Prince Mohammed bin Salman.
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