OPEC + oil production cuts, why did the United States "jump on its feet"?

In July this year, in order to alleviate the high oil price in the United States, US President Biden gave up his vow to make Saudi Arabia a "pariah" country and reluctantly went to Saudi Arabia to show goodwill
.
Today, that strategy seems to have failed – the relationship between the two countries is in tatters
.
At the time, Biden visited Saudi Arabia in hopes of persuading the world's largest oil producer to increase production to offset the rising
cost of gasoline caused by the Russian-Ukrainian war.

Instead, last week, the Saudi Arabia-led OPEC+ announced it would slash oil production, which would push prices higher, a move that could lead to higher
gasoline prices in the U.
S.
just weeks before the U.
S.
midterm elections.
In an interview on Monday, Biden threatened OPEC+ with unspecified "consequences"
for the decision.
On Wednesday night, U.
S.
Democrats told Saudi Arabia that if the kingdom does not change course, the United States must immediately freeze all U.
S.
cooperation with Saudi Arabia, including arms sales
.

So why did OPEC+ agree to a production cut at this juncture? What does the production cut mean for the United States?

OPEC+ agrees to cut production?

OPEC was founded in 1960 as a way
to counter U.
S.
import restrictions and the enormous influence of multinational oil and gas companies to force oil prices up.
Today, the organization has 13 member states, with Saudi Arabia being the most influential
.
Russia is a member of
the expanded OPEC+ of the organization.
The group was founded in 2016 to address major new challenges facing OPEC's control of the market, including the rise of the United States as a major exporter and the growth of
renewable energy.

Economists tend to think of OPEC and OPEC+ as textbook cartel examples: members agree to coordinate oil production to influence prices
.
OPEC+ countries control about 50% of the world's crude oil and 90% of proven reserves; When they agree to slash production like they did last week, it drives up costs
.

Those who believe that Biden's trip to Saudi Arabia was doomed from the start may point to the fact that as early as the start of the conflict in Ukraine, a Saudi company invested $500 million in Russian oil giants Gazprom, Rosneft and Lukoil, or the Saudi government decided this summer to double the amount of Russian oil purchased by its power plants to free up more domestic crude
。

Meanwhile, the president of the UAE, a close OPEC ally, visited Russia on Tuesday for face-to-face talks
with Putin.
All this shows that Saudi Arabia and its partners have made a decisive shift
towards Russia this year.
In part, this is an economic calculation
based on the common interest of high oil prices.

Julian Borger, world affairs editor at The Guardian, pointed to another possible factor in OPEC+ decision: Prince Mohammed believes it would be advantageous
for a Trump to be elected president and Republicans to take control of Congress.
Borger said that by the possible impact on U.
S.
gasoline prices, "they're putting their thumbs on the scales of the U.
S.
election.
"

Why did the United States react so much?

OPEC has been a recognized bellwether for oil markets for decades, but the context of this decision is very different
.
For the United States, in a time of economic turmoil, this move, in addition to pushing up gasoline prices (and thus inflation), is also of great benefit
to Russia.

Moscow's oil revenues fell
sharply after European countries began to reduce oil imports.
Crucially, despite the nominal 2 million barrels per day cuts in OPEC and OPEC+, Russia's output is already well below its quota, meaning this decision will allow it to produce more oil
at a higher price.

Second, the news is especially unpopular in the United States, where the possible consequences of higher oil prices are painful for Biden ahead of
the crucial midterm elections.
It is also bad for the campaign, which could also be seen as a shame given Biden's decision this summer to make a 180-degree turn, abandoning a campaign promise
to marginalize Prince Mohammed over Khashoggi's death.

Borger said: "There are a lot of people in the Democratic Party who are against this, and the whole moral dimension, the war in Yemen and the death of Khashoggi
.
To visit Saudi Arabia, Biden spent a lot of political capital
.
Democratic senators believe they have reservations on the matter, giving Biden some leeway
.
”

Neil Quilliam, a senior fellow at Chatham House, a British think tank, said that even within OPEC+, there was some unease: member states would undoubtedly be uneasy
about the strength of the US counterattack.
Kuwait, for example, still attaches great importance to relations with the United States and will undoubtedly be disturbed
by the current situation.

How will the United States and its allies respond?

In an interview on Monday, Biden threatened to hold OPEC responsible for the "consequences" of the cuts, but did not specify what the consequences might be
.
Senior Democrats in the U.
S.
Congress have called for aggressive action that would have a substantial impact
on Saudi Arabia's economic and military power.

Sen.
Bob Menendez, chairman of the Foreign Relations Committee, said he would vote to block future arms sales, while Senate Majority Leader Chuck Schumer was reportedly "seriously considering" legislation to allow lawsuits
against Saudi Arabia for price fixing.
In the article, Senator Richard Blumenthal and Rep.
RoKhanna called for legislation to force the United States to immediately halt all arms sales
.
They argue that it will take decades for the Saudi government to switch to alternative suppliers, and Prince Mohammed will have no choice but to negotiate
.

Borger argues that "it's a matter of bipartisanship, at least for now — Republicans will support this kind of action
.
" But for the upcoming midterm elections in the United States, some analysts pointed out that the Republican Party may reduce its willingness to intervene to lose the Democratic Party's advantage
.

What happens next?

Quilliam noted that this is not a "time of no turning back" that "relations between the United States and Saudi Arabia will be restored," in part because the relationship between the two countries is more deeply rooted in
both countries' institutions.
But he added that it was a "subtle rupture"
.
"The relationship between Saudi Arabia and the Biden administration cannot be repaired, but other Democratic administrations are likely to remember this moment"
.

On Tuesday, the Saudi foreign minister insisted that the relationship between Saudi Arabia and the United States "has been institutional" since its inception and claimed that OPEC+'s decision was "purely economic.
"
Saudi Arabia joined the United Nations in an overwhelming vote Wednesday night to condemn Russia's annexation of parts of Ukraine, which Borger said was "a way to show that they are still willing to do business.
"

To assess Saudi Arabia's possible path forward, he added, it is important to remember that "Prince Mohammed has shown disobedience during every downturn in relations between the two countries after Khashoggi's death
.
" There seems to be a very personal feeling that he is not respected"
.
In this analysis, the Guardian's Middle East correspondent Martin Chulov argues that his ambition is to make Saudi Arabia "no longer a theocratic state that escapes progress and hides under the American security umbrella.
.
.
but a rich, medium-sized country that chooses its friends on its own terms and on its own terms"
.

In the short term, this seems to be good news for Russia and bad news
for the United States and its allies.
In the long run, a breakdown in relations between the two countries could be catastrophic
for Saudi Arabia.