Industry

Saudi, UAE defend OPEC decision to cut oil production, despite US warning

Saudi Arabia and the United Arab Emirates defended on Monday a decision by OPEC and its allies to cut oil production, even as an American envoy warned of “economic uncertainty” ahead for the world.

 

While cordial, the comments at the Abu Dhabi International Petroleum Exhibition and Conference showed the stark divide between the United States and Gulf Arab countries it supports militarily in the wider Middle East.

 

Saudi Arabia’s energy minister, Prince Abdulaziz bin Salman, hinted at that in brief remarks to the event, noting that upcoming U.N. climate change summits will be held in Egypt and the United Arab Emirates.

 

“We don’t owe it to anybody but us,” the prince said to applause.

 

Read: Response to OPEC’s oil cuts: Biden will release 15mn barrels from US strategic reserve

 

Emirati Energy Minister Suhail al-Mazrouei echoed that defense. While saying that OPEC and its allies are “only a phone call away if the requirements are there” to raise production, he offered no suggestion such a boost would be on its way anytime soon.

 

“I can assure you that we in the United Arab Emirates, as well as our fellow colleagues in OPEC and OPEC+ are keen on supplying the world with the requirement it needs,” al-Mazrouei said. “But at the same time, we’re not the only producers in the world.”

 

OPEC and a loose confederation of other countries led by Russia agreed in early October to cut its production by 2 million barrels of oil a day, beginning in November.

 

OPEC, led by Saudi Arabia, has insisted its decision came from concerns about the global economy. Analysts in the U.S. and Europe warn a recession looms in the West from inflation and subsequent interest rate hikes, as well as food and oil supplies being affected by Russia’s war on Ukraine.

 

“The global economy is on the knife’s edge,” insisted Sultan Ahmed Al Jaber, the managing director of the state-run Abu Dhabi National Oil Co.

 

American politicians, meanwhile, have reacted angrily to a decision likely to keep gasoline prices elevated. An average gallon of regular gasoline in the U.S. now costs $3.76 — down from a record $5 a gallon in June but still high enough to bite into consumers’ wallets. Benchmark Brent crude oil sat at $95 a barrel Monday.

 

“I think at the end of the day, we are facing an economic uncertainty globally,” said Amos Hochstein, the U.S. envoy for energy affairs.

 

Read: How the cuts announced by OPEC+ will affect oil prices, inflation

 

Hochstein declined to speak to The Associated Press after the event in the UAE.

 

President Joe Biden, who traveled to Saudi Arabia in July and fist-bumped Crown Prince Mohammed bin Salman before a meeting, recently warned the kingdom that “there’s going to be some consequences for what they’ve done.”

 

Saudi Arabia lashed back, publicly claiming the Biden administration sought a one-month delay in the OPEC cuts that could helped reduce the risk of a spike in gas prices ahead of the U.S. midterm elections Nov. 8.

 

The back-and-forth between Riyadh and Washington shows how tense relations remain between the two countries since the 2018 gruesome killing of Washington Post columnist Jamal Khashoggi by Saudi security forces. American intelligence agencies believe the slaying came at Prince Mohammed’s order.

 

Source: United News of Bangladesh