Biden administration officials have been working with their Middle Eastern oil-producing counterparts for more than a week to minimize production cuts by OPEC+, a Saudi-led group, to curb rising global oil prices. Talks went dramatically.
That engagement includes outreach by senior State, Treasury and National Security Council officials. An official familiar with the call said the effort does not deviate from the administration’s efforts over the past year to urge oil producers to maintain high production levels after Russia’s invasion of Ukraine, which disrupted global markets. I’m here.
“We are in constant dialogue with all producers and consumers, including our OPEC+ partners,” said National Security Council spokeswoman Adrian Watson. This is true across bipartisan governments, including: It is clear that energy supply must meet demand in order to support economic growth and keep prices down for consumers around the world, and we will discuss this with our partners. We will continue.”
Administration officials have reminded their counterparts that the United States plans to boost global oil demand in the near future by purchasing oil at fixed prices to replenish the country’s strategic oil reserves. Biden began releasing 1 million barrels a day from reserves in March to boost oil supplies and keep prices down. White House press secretary Karine Jean-Pierre told reporters this week that the administration has no plans to continue the release beyond the end of the month when the effort is due to expire.
Replenishing reserves could ultimately help stabilize oil demand and boost incomes for large oil producers.energy sector proposed a regulation This summer, the government will be able to enter into contracts to replenish reserves at a fixed price in the future. The effort could help boost oil production, as it gives oil producers reassurance that they can sell their crude at the set rate even if global oil prices fall again. said a government official.
This debate, and the decisions made by the world’s oil producers, come at a volatile time for global oil markets and Biden’s domestic political calculations. After falling over the summer, global oil prices have started to rise again. Gasoline prices across the country have done the same, undermining Mr. Biden’s bragging rights in recent months.
But as central banks around the world aggressively raise interest rates to stem high inflation, fears of a global recession are growing. That could cut demand for oil, sending prices plummeting and hurting big oil producers. Conversely, if new European sanctions forced millions of barrels of Russian oil out of global markets every day, prices could skyrocket at the end of the year. This is why administration officials and their allies are pushing an untested plan to keep the Russian oil flow going. Market it, but only at a discounted price.