Saudi Arabia doubles up on Russia's request to cut down production

By Al Mayadeen English
Source: The Intercept
21 Oct 2022 00:08
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Russia requested a one million barrels reduction in OPEC+ production, but Saudi Arabia insisted on a two million barrels reduction, which was a surprise even to Putin.

The oil cut was deliberately planned by Saudi Arabia to hurt Dems, the

The Intercept published an article on Thursday that detailed the reasons why Saudi Arabia pushed for an oil cut on October 5, which rankled Democrats in Washington ahead of the upcoming midterms elections which are set to take place on November 8.

OPEC+ had announced earlier this month that it was slashing 2 million barrels of oil per day, leading the Democrats to accuse Riyadh of taking Russia's side in that decision.

"What Saudi Arabia did to help Putin continue to wage his despicable, vicious war against Ukraine will long be remembered by Americans," said Senate Majority Leader Chuck Schumer.

However, according to two anonymous Saudi sources familiar with the matter, Saudi Arabia pushed the oil cut twice as much as Russia intended, thus revealing motives that "run deeper than what top Democrats want to admit."

The media has especially made it obvious that Saudi Arabia intended to drive an oil cut that was far more aggressive than Russia's.

On September 27, Russia sought to implement a 1 million barrel per day cut — just half of what would later be agreed upon.

This is what the world initially expected.

Then came the fatal announcement on October 5 that OPEC+ would double that cut by 2 million barrels a day.

On October 14, the White House National Security Council Spokesperson John Kirby accused Saudi Arabia of coercing other OPEC+ members who did not initially agree on the cut though he failed to specify which countries.

According to The Wall Street Journal, the members who were "coerced" into agreeing to the cut include Kuwait, Iraq, Bahrain, and the UAE.

That is obviously untrue since Iraq recently expressed that it fully supported OPEC+'s decision.

These countries reportedly feared that the production cuts could lead to a recession that would ultimately reduce demand for oil.

But Saudi Arabia's decision came as a shock to the US.

"People in D.C. think MBS is siding with Putin, but I think MBS is even more Putinian than Putin," one of the sources, a Saudi close to the royal family, said, referring to Saudi Arabia’s de facto ruler, Crown Prince Mohammed bin Salman.

Despite that Saudi Arabia argued that its decision was based on goodwill and wholly economic and aimed at stabilizing the energy markets, the Democrats accused the Saudis of "pursuing a conscious alignment with Russia."

"The Saudi foreign ministry can try to spin or deflect, but the facts are simple," Kirby said, alleging that "they knew" that the oil production cut would "increase Russian revenues and blunt the effectiveness of sanctions” against Russia amid its special operation in Ukraine.

Some Democratic experts argue that the cut particularly targets the Democratic Party, something that officials have been reluctant to admit.

Bruce Riedel, a senior fellow at the Brookings Institution, told The Intercept in an email, "The Saudis are well aware that the price of gasoline at the pump has been a crucial political issue in the United States since 1973."

"They want a big increase to help the Republicans,” he added, explaining that MBS sees the GOP winning back Congress as the “first step to Trump winning in 2024 and a setback for Biden."

During the 1970s, Saudi Arabia led two oil embargoes that had a decisive impact on the US economy and on presidential elections which cost Jimmy Carter to lose to Ronald Reagan in 1980.

Following this defeat, Carter placed solar panels on the White House roof to bring to light the US' over-dependency on oil; a gesture he was mocked for.

Since MBS stepped into power, it was clear that the Conservatives had less difficulty dealing with oil demands.

MBS complied with Donald Trump two times over the fluctuation of gas prices: the first in 2018 and the second in 2020 so that Trump can ensure that the domestic American shale industry would survive the pandemic.

"MBS enjoyed a sweetheart relationship with Trump," Riedel said. "Trump stood by MBS when he murdered Khashoggi and his war in Yemen which has starved tens of thousands of children; there was never any criticism of the Saudi’s human rights abuses from the Trump administration."

As soon as Trump got elected, the first thing he did was fly to Riyadh as President where he was generously well-received and struck a record-breaking $350 billion weapons deal with the Saudi government.

He also vetoed three separate congressional bills that would have blocked the sale of weapons to Riyadh, and he even boasted about covering MBS from consequences for the murder of journalist Jamal Khashoggi, saying, "I saved his a**."

Sarah Leah Whitson, executive director of Democracy in the Arab World Now, said, "You don’t need to look hard to understand that MBS is deliberately and persistently acting against U.S. interests and the Biden administration in particular. His actions are not just ‘snubs’ but punches in the face."

"He’s very nakedly using oil as a lever to try to influence the midterm elections with the aim of bringing in more compliant Republicans, trying to show us all who’s boss even in our own democracy."

Saudi officials have themselves acknowledged that they could exert an impact on the domestic US.

In 2004, Prince Bandar bin Sultan Al Saud, the Saudi aQmbassador to the US from 1983 to 2006, said during a talk show, "The kingdom’s oil decisions can influence the election or non-election of the president of the United States, the largest and strongest country in the world. For that to be taken into consideration, regardless of what the kingdom decides to do, is in itself evidence of the strategic weight for the kingdom of Saudi Arabia."

In another interview in 2004, Bandar said, "President [Bill] Clinton asked us to keep the prices down in the year 2000. In fact, I can go back to 1979, President Carter asked us to keep the prices down to avoid the malaise."

In October 2018, following the assassination of Khashoggi, a Washington Post columnist, Turki Aldakhil warned of an economic disaster if the US sanctioned Riyadh.

"If U.S. sanctions are imposed on Saudi Arabia, we will be facing an economic disaster that would rock the entire world,” wrote Turki Aldakhil. "It would lead to Saudi Arabia’s failure to commit to producing 7.5 million barrels [of oil]."

We are not saying here that Saudi Arabia under MBS hasn’t pursued cozier relations with Russia.

Relations between Putin and MBS go back to 2015 when former US President Barack Obama turned down MBS’ requests for a meeting. MBS had then opted to meet with Putin on the sidelines of the 19th St. Petersburg International Economic Forum.

In response to the oil slash OPEC+ imposed, and after using up all other possible options, the White House was left with no choice but to release 15 million barrels of oil from its strategic emergency oil reserves.

It even considered lifting sanctions on Venezuela to alleviate the negative effects of OPEC+’s production cut.

An executive vice president of the Quincy Institute, Trita Parsi, told The Intercept, "The U.S. has helped artificially make Saudi Arabia more powerful on the energy markets by sanctioning the oil of other major producers."

"Just as [Secretary of State] Tony Blinken said that the destruction of the Nord Stream gas pipeline was an opportunity for Europe to reduce its dependence on Russian gas, Biden should turn the current crisis into an opportunity to reduce its own dependence on Riyadh by rethinking its unsuccessful energy sanctions on Venezuela and Iran."