US accuses OPEC+ of aligning interests with Russia

Group announced reduction in oil production by 2 million barrels per day; Biden wants to seek energy independence

The White House said the OPEC+ is lining up with Russia after the group announced a reduction in oil production by 2 million barrels a day this Wednesday (5.Oct.2022). The measure will take effect from November.

This is the biggest cut of the group led by Saudi Arabia. since the beginning of the pandemic. According to the organization, the decision was made “in light of the uncertainty surrounding the global economic outlook and the oil market”.

Here’s the intact from the OPEC+ communiqué (120 KB).

According to the White House, the cut favors Russia, as the trend is that the drop in production will increase the price of oil.

Joe Biden called on Congress and the administration to look for solutions to increase energy production in the US, seeking to reduce OPEC+’s control over prices.

“OPEC+’s decision to cut production quotas is short-sighted as the global economy is dealing with the continued negative impact of Putin’s invasion of Ukraine.“, said Karine Jean-Pierre, spokesperson for the White House, in an interview with journalists. “If there is a significant price impact from the OPEC decision, it will be particularly in low- and middle-income countries.“, he stated.

“It is clear that OPEC+ is lining up with Russia with today’s announcement“, added Jean-Pierre.

The movement of producing countries to keep prices high is a response to the decrease in global demand for the input.

The decision pushed up the price of Brent oil, by 2.2%, to US$ 93.90 by 12:40 pm on Wednesday (5.Oct.2022). Shares of oil companies such as Petrobras, rose with the news. The role of the Brazilian state-owned company advanced 2.7%, to R$ 32.3 in the early afternoon.