Biden admin asked Saudi Arabia to postpone OPEC cut by a month, Saudi

The Biden administration asked Saudi Arabia, the de-facto leader of oil producer group OPEC, to delay its decision on oil output by a month, the kingdom said in a statement.

The Saudis declined, and in early October OPEC+ — which includes non-OPEC oil exporters like Russia — announced its largest supply cut since 2020, to the tune of 2 million barrels per day starting from November. That means tighter supplies and higher prices at a time of already high inflation and worries of global recession, which angered U.S. lawmakers who are now calling for a “reevaluation” in relations with the Saudi kingdom.

Notably, Biden’s request would have delayed the decision until after the U.S. midterm elections.

In a statement dated Wednesday, the Saudi government defended its move and said all OPEC decisions are based on economic forecasts and needs.

“The Government of the Kingdom clarified through its continuous consultation with the US Administration that all economic analyses indicate that postponing the OPEC+ decision for a month, according to what has been suggested, would have had negative economic consequences,” the statement read.

Responding to the Saudi claims, Pentagon spokesman John Kirby reframed the exchange and accused the kingdom of aiding Russia’s revenues and hampering the impact of Western sanctions on Moscow for its war in Ukraine.

“In recent weeks, the Saudis conveyed to us – privately and publicly – their intention to reduce oil production, which they knew would increase Russian revenues and blunt the effectiveness of sanctions. That is the wrong direction,” Kirby said. “We presented Saudi Arabia with analysis to show that there was no market basis to cut production targets, and that they could easily wait for the next OPEC meeting to see how things developed.”

Kirby added that other OPEC members opposed Saudi Arabia’s move, and reiterated the Biden administration’s vow to reexamine its relationship with Riyadh.

“Other OPEC nations communicated to us privately that they also disagreed with the Saudi decision, but felt coerced to support Saudi’s direction,” he said. “As the President has said, we are reevaluating our relationship with Saudi Arabia in light of these actions, and will continue to look for signs about where they stand in combatting Russian aggression.”

On Tuesday, President Joe Biden said that there would be “consequences” for Saudi Arabia’s oil production cut, which the kingdom is carrying out in coordination with other OPEC members and non-OPEC allies like Russia. Many in Washington saw this as a snub and a blatant display of siding with Moscow.

U.S. lawmakers have urged the cutting of military sales to Saudi Arabia, America’s top weapons buyer, and are encouraging the passing of anti-trust legislation that would go after…