WH considers recommending US firms of pulling out from Saudi Arabia
No decisions have been made so far with respect to punishing Saudi Arabia for its role in the OPEC+ move as the US government juggles between the pros and cons of alternative ways of responding to Riyadh.
NBC reported on Tuesday that officials from the Biden administration are considering recommending US companies of pulling out their investments and cease business projects and ventures with Saudi Arabia in light of Riyadh’s alleged role in deciding on the oil cut in OPEC+'s most recent decision.
According to the report, citing a spokesperson for the White House, Adrienne Watson, the administration has not yet transferred the recommendation to US firms.
The report added the White House does not plan of sending any envoys to Saudi Arabia’s annual Future Investment Initiative conference which will be held in Riyadh next week.
It further stated that no decisions have been made so far with respect to punishing Saudi Arabia for its role in the OPEC+ move. The US government continues to weigh the pros and cons of alternative ways of responding to Ryadh to see which pathway will lead to securing its strategic interests in the Middle East.
Yet, some suggestions have been presented to the table. On October 10, US Democratic Senators Richard Blumenthal and Democratic Representative Ro Khanna proposed legislation to stop Washington from providing weapons to Riyadh, arguing that what the US regards as the kingdom's support for Russia deserves a "far-reaching review of the US-Saudi relationship."
When the oil cut was introduced, the US then began to lose composure and was trying to push additional volumes of its reserves on the market.
Saudi Minister of State Adel Al-Jubeir blamed Washington's incompetency in dealing with the high prices at home, arguing that "the reason you have high prices in the United States is because you have a refining shortage that has been in existence for more than 20 years. You haven't built refineries in decades."
On October 12, US President Joe Biden threatened Saudi Arabia with "consequences" after a coalition led by Riyadh agreed with Russia to cut output. He said that the United States' relationship with Saudi Arabia should be reconsidered in light of this decision.
Prior to OPEC's cut in oil production, US officials reached out to their Saudi counterparts and other Gulf producers with an appeal to delay the decision, according to people familiar with the conversations. However, the answer was nothing else than a resounding "no".
In a strong move, Russian President Vladimir Putin said on October 12 that Russia will stick to common sense and only supply energy to countries that have not introduced price caps on energy prices and will stop energy exports to countries with price caps.
"Russia will not act in a manner that goes against common sense by paying for someone else's well-being at its own expense. We will not supply energy resources to those countries that will limit their prices," Putin told the Russian Energy Week.
On October 15, Saudi Arabia announced $400 million in humanitarian aid for Ukraine, according to the Saudi Press Agency (SPA). A day later, the market index in Saudi Arabia, Tadawul All Share Index TASI, declined by 0.1% after Aramco was down by 1.1%, while Qatar's index QSI extended previous session losses after it was hit by a 0.7% decrease, according to Reuters.
Earlier today, the White House release up to 15 million barrels of oil from the country's emergency oil reserves to combat rising fuel costs. The oil release would be the latest portion of a deal struck last spring to release 180 million barrels of oil from energy companies.
It was likewise reported that US crude hit its lower end of $80 per barrel.
Read more: US oil reserves massively depleting