The OPEC+ oil coalition on Wednesday announced a significant production cut of two million barrels, prompting the White House to declare that “it is evident” that the group “is aligning with Russia.” Despite the West’s efforts to stifle oil and gas profits as a source of funding for Russia’s illegitimate invasion of Ukraine, it is expected to be a significant boost for Moscow.
The Biden administration might suffer a severe blow as American drivers may have to deal with another another spike in petrol costs. For the first time since early 2020, energy ministers from the OPEC cartel, whose major member is Saudi Arabia, and affiliated non-members like as Russia convened in person at the organization’s Vienna headquarters.
The output reduction they revealed on Tuesday is the biggest one that have occurred since the COVID-19 outbreak began. It comes after oil barrel prices, which are currently under $90 due to concerns about an impending global recession, fell by around a quarter in only three months. The Washington Post reports that prices have increased by as much as 60 cents a gallon in some US regions, highlighting the precarious situation.
As he boarded Marine One for a trip to hurricane-ravaged Florida, President Joe Biden was questioned about OPEC+’s decision, but he told reporters he “needed to examine the specifics.” According to reports, he stated that he was “concerned” and that it was a “unnecessary” measure.
Biden was “disappointed by the shortsighted choice,” according to a joint statement from National Economic Council Director Brian Deese and White House National Security Advisor Jake Sullivan.
The decision, it said, “would have the most adverse impact on lower- and middle-income nations that are already grappling with higher energy prices at a time when ensuring a global supply of energy is of crucial significance.”
They added: “In light of today’s move, the Biden Administration will also confer with Congress on other tools and authority to decrease OPEC’s dominance over oil prices.” They also hinted that a fresh legislative push would be in the works.
Although the announcement’s impact on the pumps is yet uncertain, the Biden administration is reportedly trying to prevent a “complete calamity” as a result of the move. The amount to which Biden’s release of the strategic petroleum reserves “distorted actual price discovery” was a question that was posed to OPEC+ during a news conference on Tuesday.
It’s not a distortion, in my opinion. It was completed on schedule. They added, “I’m sure things may be different than they are now if that hadn’t happened. [wpdiscuz-feedback id=”3q531p4zg6″ question=”Please leave a feedback on this” opened=”0″]Do you think Biden will sanction Saudi Arabia for working with Russia? [/wpdiscuz-feedback]
The decision made by OPEC during their meeting on Wednesday may push gas prices back up after the White House praised their record-breaking down this summer. In recent weeks, they have already started to slowly climb back up.
However, a rapid increase would be a particularly worrisome setback given that the midterm elections in November are less than one month away. According to a source who spoke to CNN, the White House is “having a spasm and panicking” at the possible result.
High ranking officials in the fields of foreign and economic affairs are allegedly pressuring Middle Eastern friends to vote against reducing output.
In an interview with Fox News on Wednesday morning, John Kirby, the Coordinator for Strategic Communications at the National Security Council, minimized the impact of the downsizing.
They are revising their figures downward a little bit at this point. OPEC + has been claiming to produce 3.5 million more barrels than they actually do, according to Kirby.
Therefore, this reported drop in some ways only brings them back into closer alignment with actual output. Noting that Wednesday’s prices are still in the low 90s, he continued, “There have been no big movements in the price of oil.”
Karine Jean-Pierre, the White House’s press secretary, was questioned on Tuesday over the White House’s earlier victory laps over declining gas prices, which have resulted in relative silence as they begin to creep up again.
You claimed that the president was to blame for the decline in petrol prices. Is the president to blame for the increase in petrol prices? Peter Doocy of Fox News posed the query at Jean-routine Pierre’s press conference. So, it’s far more subtle than that, she said.
Gas prices have increased globally, according to Jean-Pierre, who attributed the increases to “the [COVID-19] epidemic and Putin’s war” in Ukraine.
The Biden representative remarked, “We acknowledge there is more work to be done; we have never claimed we are done here.”
But in actuality, the price of gasoline has dropped at its quickest rate in over ten years. That is a result of the actions taken by this administration. In advance of a European Union embargo on the majority of Russian oil imports, a penalty over the invasion of Ukraine, which goes into force at the end of the year, a production decrease might help Russia by setting higher prices, according to experts at Commerzbank.