The “OPEC +” alliance decided to significantly reduce oil production, which angered the United States, which confirmed that the decision would harm countries already suffering from high crude prices, accusing the alliance of “standing by Russia.”
Members of the Organization of Petroleum Exporting Countries (OPEC) and their partners within the framework of the “OPEC +” alliance agreed on Wednesday to significantly reduce production quotas, which angered the United States, which confirmed that the decision would harm countries that are already suffering from high crude prices.
The organization, which includes 13 countries and its ten allies led by Russia, said that it was agreed during their meeting in Vienna to reduce production by two million barrels per day, starting in November, in what is the largest reduction since the height of the Covid pandemic in 2020.
The move could increase crude oil prices, which will exacerbate inflation that has reached record levels for decades in many countries and contribute to a global economic slowdown.
Saudi Energy Minister Abdulaziz bin Salman said, after the first in attendance meeting of coalition members since March 2020, that the priority of “OPEC +” is to “preserve a sustainable oil market.” The Iraqi News Agency quoted the Iraqi Oil Marketing Company (SOMO) as saying today that the decision prevents the continued decline in oil prices. Sumo added that Iraq’s share of production after the reduction will reach 220,000 barrels per day.
American condemnation
But the move drew condemnation from US President Joe Biden, who made a controversial visit to Saudi Arabia in July aimed in part to press for increased oil production as prices at gas stations soar.
In a statement signed by National Security Adviser Jake Sullivan and Chief Economic Adviser Brian Dees, the White House said Biden was “disappointed by the short-sighted OPEC+ decision.” The statement added that the production cut would harm countries “already suffering” from high prices while “the global economy deals with the continuing negative impact” of the Russian attack on Ukraine.
As for presidential spokeswoman Karen-Jean-Pierre, she said that the decision “constitutes a mistake,” adding: “It is clear that through his decision today, the OPEC + alliance stands with Russia.” And the spokeswoman on the plane carrying President Biden to Florida to inspect the damage caused by Hurricane Ian considered this decision “a mistake.”
repercussions of the decision
The price of a barrel of North Sea Brent crude rose nearly 2 percent to $93.41 after Wednesday’s announcement. Russian Deputy Prime Minister Alexander Novak, who participated in the “OPEC +” meeting, said that setting a price ceiling would have a “harmful effect” on the global oil sector, stressing that Russian companies “will not supply oil to countries that use this tool.”
The “OPEC +” alliance had decided to make a significant production cut by about 10 million barrels per day in April 2020, which ended the huge drop in oil prices caused by the closures during the Covid outbreak.
The alliance began increasing production last year after the market improved, and production returned to pre-pandemic levels this year, but only on paper, as some members are facing difficulties in meeting their quotas. The group agreed last month to a small token cut of 100,000 barrels per day from October, the first in more than a year.
Source: Al-Manar + dw