RIYADH (Middle East Eye) – Saudi Arabia has expressed its “total rejection” of the outpouring of condemnation from the U.S. over the OPEC+ decision to issue a major production cut, saying its decision was based on the economic interests of the oil cartel members, not on political motivations.
“These outcomes are based purely on economic considerations that take into account maintaining balance of supply and demand in the oil markets, as well as aim to limit volatility that does not serve the interests of consumers and producers, as has been always the case within OPEC+,” said a statement attributed to a Saudi foreign ministry official.
The detailed statement came after the White House announced it would be reviewing the U.S.-Saudi relationship following last week’s decision by the Saudi-led OPEC+ to cut oil output by two million barrels a day.
The Biden administration fears the production cut is a political blow to the Democratic Party ahead of a pivotal midterm election cycle in November, as Washington predicts the production cuts boosting petrol prices across the country.
This remains to be seen, as the national average for gasoline prices in the U.S. has only risen a few cents since last week and the price of Brent Crude, the international benchmark for oil, has on Thursday fallen back to where it was right up to OPEC’S announcement.
The Saudi statement on Thursday also said the Biden administration asked the kingdom to delay a decision to cut oil prices for a month, implying that the request could have been election-related.
The statement said such a delay “would have had negative economic consequences”.
Nevertheless, the Biden White House responded to the Saudi statement on Thursday, also warning of “consequences” for Riyadh’s decision, which it described as an alignment with U.S. adversary, Russia.
“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,” White House National Security Council spokesman John Kirby said in a statement.
“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 told the U.S. privately they disagreed with Riyadh’s decision, “but felt coerced to support Saudi’s direction”.