US-Saudi rift grows over decision to cut oil production

  • 10/13/2022
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The relationship between the US and Saudi Arabia continued to worsen on Thursday as the two countries traded barbs over the decision to cut oil production, with Washington accusing Riyadh of coercing other members of the Opec+ cartel, and Riyadh suggesting the Biden administration tried to get the decision delayed by a month. In reaction to Joe Biden’s declared intention to reevaluate the US relationship with Riyadh, the Saudi foreign ministry issued an unusually long statement rejecting “attempts to distort the facts” about the kingdom’s motives for pushing for a 2m-barrel-a-day cut to Opec+ production. The Saudi government, the statement said, had explained to the US that postponing the decision by a month “according to what has been suggested” would have led to “negative economic consequences”. A month’s delay would have meant the decision came after November’s congressional elections, so the Saudi implication was that the administration was concerned with the domestic political impact of higher petrol prices, rather than the effect on Russia and the Ukraine war. “The Saudi foreign ministry can try to spin or deflect, but the facts are simple,” John Kirby, spokesperson for the national security council, responded. “In recent weeks, the Saudis conveyed to us – privately and publicly – their intention to reduce oil production, which they knew would increase Russian revenues and blunt the effectiveness of sanctions. That is the wrong direction.” Kirby added: “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. Other Opec nations communicated to us privately that they also disagreed with the Saudi decision, but felt coerced to support Saudi’s direction.” Kirby would not name which cartel members had complained about coercion but said there was more than one. He said that the process of reviewing the bilateral relationship had already begun but would be rushed, and the administration would await the return of Congress from recess in November to consult congressional leaders on the next steps. He added that the US would observe what Saudi Arabia and the rest of the cartel decided on oil production at its next meeting in December before making final decisions. “That’s certainly a major factor in our analysis of how they are going to be reacting to this Russian aggression,” Kirby said. “That’s kind of where the rubber meets the road.” Saudi Arabia has denied that the decision was taken unilaterally and said other Opec members were all in support. However, senior Democrats insist that political considerations were behind the move and that US concerns were dismissed by an ally willing to dilute a longstanding relationship, potentially in favour of the Russian president. The rift is the most serious between the US and Saudi Arabia in decades and is poised to shred a pact that guarantees energy supply in return for the US supporting the kingdom’s security. Relations between both states have deteriorated since the early days of the Biden administration when the then incoming president vowed to isolate the Saudi de facto leader, Mohammed bin Salman, whom he described as a pariah. In July this year, Biden reversed course, travelling to Jeddah to meet the crown prince, but leaving with little gained from his trip. Prince Mohammed, meanwhile, has attempted to recast bilateral ties, suggesting the US is one of several global partners and that his country no longer responds to “dictates”. In an apparent move to placate Washington, the foreign ministry statement also suggested Riyadh was likely to vote at the United Nations in support of a resolution condemning Russia for the “annexation” of Ukrainian territory last month. Riyadh, however, has remained on friendly terms with Russia since the invasion of Ukraine, and in supporting an oil supply cut is accused of helping fund Putin’s war effort.

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