OPEC+ is heading for a political standoff with US President Joe Biden, as Saudi Arabia, Russia, and their allies must decide whether to heed US demands for increased oil production, Bloomberg reported ahead of today’s OPEC+ meeting.
If OPEC+ continues to act on the planned plan to increase production by only 400 thousand barrels per day in December, then the United States can take measures to consolidate the alliance of buyers, and several countries that are suffering from high prices have already sided with America.
“Look at oil prices. The cost of fuel is high due to the refusal of Russia or the OPEC countries to increase production,” President Biden said on November 2 at a press conference at the COP26 climate summit in Glasgow.
The problem goes beyond the oil market and deeply affects US’s difficult relationship with its longtime allies in the Middle East.
Biden has yet to meet with Saudi Arabia’s Crown Prince Mohammed bin Salman, infuriating the Riyadh royal court, which had almost unhindered access to the White House during the Donald Trump administration.
Biden’s declared OPEC+ arm-twisting policy has already been supported by Japan and India, but the key members of the alliance are not going to bend. For example, Iraq and Kuwait recently publicly announced that OPEC+ should adhere to the current plan – to increase supply by only 400 thousand barrels per day every month and maintain a deficit in the market until the end of the year.
This is the outcome of the OPEC+ talks that is mainly expected by observers, however, according to sources familiar with the situation, diplomatic pressure is not weakening. This leaves the possibility that some agreements between OPEC+ and its opponents, led by the United States, will be reached at the very last minute.