Following the "OPEC+" participating countries, composed of the Organization of Petroleum Exporting Countries ( OPEC ) and non-OPEC oil-producing countries, announced a 2 million barrels reduction in the daily total output cap, US President Biden said he was disappointed with this "short-sighted decision".
On October 5th local time, the 33rd Ministerial Meeting of "OPEC+" decided to reduce the average daily oil output by 2 million barrels from November 2022. This is the largest oil production cut since the COVID-19 pandemic, and this production cut is equivalent to about 2% of global oil demand. Affected by this news, the price of Brent crude oil rose by more than 1%, to nearly $93 per barrel. U.S. crude oil rose 1.5% to $87.75.
On the same day, Assistant to the National Security Affairs of the US President Sullivan and White House Director of the National Economic Commission Diss issued a statement saying: "The president is disappointed with this short-sighted decision."
statement pointed out that supply cuts will hit countries that "already shaking due to high oil prices", and the global economy is being affected by the continued negative impact of the Russian-Ukrainian conflict.
The US also announced that under the instructions of President Biden, the Ministry of Energy will provide another 10 million barrels of oil to the market from its strategic oil reserves next month. Biden called on U.S. energy companies to continue to lower oil prices by closing the gap between wholesale and retail gasoline prices.
In July this year, US President Biden visited Saudi , hoping to promote oil-producing countries represented by Saudi Arabia to make commitments to increase production. However, Saudi Arabia did not mention in a joint statement issued on the same day that it would increase oil supply. After a slight increase in production in August, "OPEC+" began to reduce production "symbolically".
U.S. gasoline prices have begun to rise again recently, and there is only one month left before the key US midterm elections. CNN (CNN) reported that this constitutes a political risk that White House is trying hard to avoid. OPEC+ announced a "major production cut plan" at this time, which will bring severe challenges to the Biden administration.
Global Times-Global Times Report Reporter Hu Xinyu
