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Associate Press copy is provided via The Canadian Press
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FILE – People and media gather at the entrance of the building of the Organization of the Petroleum Exporting Countries, OPEC, in Vienna, Austria on Oct. 5, 2022. Saudi Arabia said Thursday, Oct. 13, 2022 that the U.S. had urged the kingdom to postpone a decision by OPEC and its allies, including Russia, to cut oil production by a month which would have been just before the upcoming American midterm elections. (AP Photo/Philipp-Moritz Jenne, File)
By Jon Gambrell in Dubai
DUBAI, United Arab Emirates (AP) — Saudi Arabia said Thursday that the U.S. had urged it to postpone a decision by OPEC and its allies — including Russia — to cut oil production by a month. Such a delay could have helped reduce the risk of a spike in gas prices ahead of the U.S. midterm elections next month.
A statement issued by the Saudi Foreign Ministry didn’t specifically mention the Nov. 8 elections in which U.S. President Joe Biden is trying to maintain his narrow Democratic majority in Congress. However, it stated that the U.S. “suggested” the cuts be delayed by a month. In the end, OPEC announced the cuts at its Oct. 5 meeting in Vienna.
Holding off on the cuts would have likely delayed any rise in gas prices until after the elections.
Rising oil prices — and by extension higher gasoline prices — have been a key driver of inflation in the U.S. and around the world, worsening global economic woes as Russia’s months-long war on Ukraine also has disrupted global food supplies. For Biden, gasoline prices creeping up could affect voters. He and many lawmakers have warned that America’s longtime security-based relationship with the kingdom could be reconsidered.
The decision by the Saudi Foreign Ministry to release a rare, lengthy statement showed how tense 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 U.S. elections and instead linking it to economic considerations and Russia’s war on Ukraine.
“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,” said John Kirby, coordinator for strategic communications at the National Security Council.
“Other OPEC nations communicated to us privately that they also disagreed with the Saudi decision, but felt coerced to support Saudi’s direction,” he added, without naming the countries.
U.S.-Saudi ties have been fraught since the 2018 killing and dismemberment of Washington Post columnist Jamal Khashoggi, which Washington believes came on the orders of 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 statement by the Saudi Foreign Ministry acknowledged that the kingdom had been talking to the U.S. about postponing OPEC+’s 2 million barrel cut announced last week.
“The government of the kingdom clarified through its continuous consultation with the U.S. 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 ministry said in its statement.
The ministry’s statement confirmed details from a Wall Street Journal article this week that quoted unnamed Saudi officials saying the U.S. sought to delay the OPEC+ production cut until just before the midterm elections. The Journal quoted Saudi officials as describing the move as a political gambit by Biden ahead of the vote.
The kingdom also criticized attempts to link its decision to Russia’s war on Ukraine.
“The kingdom stresses that while it strives to preserve the strength of its relations with all friendly countries, it affirms its rejection of any dictates, actions, or efforts to distort its noble objectives to protect the global economy from oil market volatility,” it said. “Resolving economic challenges requires the establishment of a non-politicized constructive dialogue, and to wisely and rationally consider what serves the interests of all countries.”
Both Saudi Arabia and the neighboring United Arab Emirates, key producers in OPEC, voted in favor of a United Nations General Assembly resolution Wednesday to condemn Russia’s “attempted illegal annexation” of four Ukrainian regions and demand its immediate reversal.
In Congress, U.S. Sen. Chris Murphy, a Democrat from Connecticut who long has been critical of Saudi Arabia, proposed a new freeze on military aid to the kingdom. He suggested stopping a planned transfer of surface-to-air missiles to Riyadh and instead sending them to Ukraine, which has faced a renewed barrage of Russian fire in recent days.
Saudi Arabia has been targeted by Yemen’s Iranian-backed Houthi rebels who hold that country’s capital amid the long, grinding war in the Arab world’s poorest country. American air defenses have been crucial in downing Houthi-launched, bomb-carrying drones targeting the kingdom.
Once muscular enough to grind the U.S. to a halt with its 1970s oil embargo, OPEC needed non-members like Russia to push through a production cut in 2016 after prices crashed below $30 a barrel amid rising American production. The 2016 agreement gave birth to the so-called OPEC+, which joined the cartel in cutting production to help stimulate prices.
The coronavirus pandemic briefly saw oil prices go into negative territory before air travel and economic activity rebounded following lockdowns around the world. Benchmark Brent crude sat over $92 a barrel early Wednesday, but oil-producing nations are worried prices could sharply fall amid efforts to combat inflation.
Biden, who famously called Saudi Arabia a “pariah” during his 2020 election campaign, traveled to the kingdom in July and fist-bumped Prince Mohammed before a meeting. Despite the outreach, the kingdom has been supportive of keeping oil prices high in order to fund Prince Mohammed’s aspirations, including his planned $500 billion futuristic 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 pressured the kingdom over oil production, once telling a crowd that King Salman “might not be there” without U.S. military support.
On Tuesday, Biden warned of repercussions for Saudi Arabia over the OPEC+ decision.
“There’s going to be some consequences for what they’ve done, with Russia,” Biden said. “I’m not going to get into what I’d consider and what I have in 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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