DUBAI, United Arab Emirates (AP) — Saudi Arabia said Thursday that the United States had urged it to delay a decision by OPEC and its allies, including Russia, to cut oil production by a month. That delay could have helped reduce the risk of a spike in gas prices ahead of next month’s US midterm elections.
A statement issued by the Saudi Foreign Ministry did not specifically mention the November 8 election in which US President Joe Biden is trying to maintain his narrow Democratic majority in Congress. However, he claimed that the US “suggested” that the cuts be delayed by a month. In the end, OPEC announced the cuts at its October 5 meeting in Vienna.
Withholding the cuts would likely have delayed any increase in gas prices until after the election.
Rising oil prices – and by extension, rising gasoline prices – have been a key driver of inflation in the US and around the world, worsening global economic problems as Russia’s war on Ukraine has also disrupted the world’s food supply for months. For Biden, rising gas prices could sway voters. He and many lawmakers have warned that the U.S. security relationship with the kingdom could be reconsidered.
The Saudi Foreign Ministry’s decision to release a rare and lengthy statement showed how strained relations between the two countries have become.
The White House pushed back on Thursday, rejecting the idea that the requested delay was related to the US election and instead linking it to economic considerations and Russia’s war against Ukraine.
“We presented Saudi Arabia with an analysis to show that there was no market basis for reducing production targets and they could easily wait until the next OPEC meeting to see how things developed,” said John Kirby, National Security Strategic Communications Coordinator. advice
“Other OPEC nations told us privately that they also disagreed with the Saudi decision, but felt compelled to support the Saudi leadership,” he added, without naming the countries.
US-Saudi ties have been strained since the 2018 killing and dismemberment of Washington Post columnist Jamal Khashoggi, which Washington believes was ordered by Saudi Crown Prince Mohammed bin Salman. Meanwhile, higher energy prices provide a weapon Russia can use against the West, which has been arming and supporting Ukraine.
The Saudi Foreign Ministry statement acknowledged that the kingdom had been talking to the US about postponing the 2 million barrel OPEC+ cut announced last week.
“The kingdom’s government clarified through its ongoing consultation with the US administration that all economic analyzes indicate that postponing the OPEC+ decision for one month, as suggested, would have negative economic consequences,” the ministry said in its statement. .
The ministry’s statement confirmed details of a Wall Street Journal article this week that quoted unnamed Saudi officials as saying the US tried to delay the OPEC+ production cut until just before the midterm elections . The newspaper cited Saudi officials who described the move as a political move by Biden ahead of the vote.
The kingdom also criticized attempts to link its decision to Russia’s war against Ukraine.
“The kingdom emphasizes that while it strives to preserve the strength of its relations with all friendly countries, it affirms its rejection of any opinion, action or effort to distort its noble goals of protecting the global economy from oil market volatility,” he said. . “The resolution of economic challenges requires the establishment of a non-politicized constructive dialogue and wise and rational consideration of what serves the interests of all countries.”
Both Saudi Arabia and neighbors the United Arab Emirates, key OPEC producers, voted Wednesday in favor of a United Nations General Assembly resolution to condemn the “attempted illegal annexation ” of Russia from four regions of Ukraine and demand their immediate revocation.
In Congress, US Senator Chris Murphy, a Connecticut Democrat who has long been critical of Saudi Arabia, proposed a new freeze on military aid to the kingdom. He suggested halting the planned transfer of surface-to-air missiles to Riyadh and sending them to Ukraine, which has faced a renewed barrage of Russian fire in recent days.
Saudi Arabia has been targeted by Yemen’s Iran-backed Houthi rebels, who hold the country’s capital amid a long and fractious war in the Arab world’s poorest country. US air defenses have been crucial in shooting down Houthi-launched bomb-carrying drones aimed at the kingdom.
Once muscular enough to rein in the US with its 1970s oil embargo, OPEC needed non-members such as Russia to push for a production cut in 2016 after prices fell below $30 a barrel amid the increase in American production. The 2016 deal led to the so-called OPEC+, which joined the cartel to cut production to help stimulate prices.
The coronavirus pandemic briefly saw oil prices dip into negative territory before air travel and economic activity rebounded from lockdowns around the world. Benchmark Brent crude topped $92 a barrel early Wednesday, but oil-producing nations fear prices could fall sharply amid efforts to fight inflation.
Biden, who called Saudi Arabia an “outcast” during his 2020 election campaign, traveled to the kingdom in July and fist bumped Prince Mohammed before a meeting. Despite the disclosure, the kingdom has supported keeping oil prices high in order to finance Prince Mohammed’s aspirations, including his futuristic $500 billion desert city project called Neom.
Prince Mohammed and his father, King Salman, hosted former President Donald Trump on his first trip abroad and enjoyed a closer relationship with his administration. Yet even Trump pressed the kingdom on oil production, once telling the crowd that King Salman “might not be here” without US military support.
On Tuesday, Biden warned of repercussions for Saudi Arabia over the OPEC+ decision.
“There will be some consequences for what they’ve done with Russia,” Biden said. “I won’t go into what I would think and what’s on my mind. But there will be, there will be consequences.”
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Associated Press writer Aamer Madhani in Washington contributed to this report.
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Follow Jon Gambrell on Twitter at www.twitter.com/jongambrellAP.