Yellen cries foul over OPEC+ production cuts ahead of US midterms

US Treasury Secretary Janet Yellen has cried foul over this week’s decision by the Organization of the Petroleum Exporting Countries and allies (OPEC+) to lower oil production, saying it will hurt the global economy.

“I think OPEC’s decision is unhelpful and unwise — it’s uncertain what impact it will end up having, but certainly, it’s something that, to me, did not seem appropriate, under the circumstances we face,” Yellen said in a phone interview with the Financial Times on Sunday. “We’re very worried about developing countries and the problems they face.”

However, independent observers believe the Biden administration is worried that the decision to cut oil production will cause a gas price hike in the US ahead of the November midterm elections which Democrats are already set to lose to the Republicans.  

The oil-exporting alliance, which includes the 13 OPEC nations and 11 non-members including Russia, made the production cut announcement on Wednesday. The group agreed to cut output by 2 million barrels per day, equal to 2 percent of global supply.

The OPEC move was a large blow to the administration of US President Joe Biden, who visited oil-rich Saudi Arabia on a July trip to appeal to Saudi Crown Prince Mohammed bin Salman.  

The decision was made as US-led Western nations continue attempts to curb Iran’s and Russia’s oil trade as part of illegal sanctions, while also grappling with soaring energy prices in the US.

“Saudi Arabia and the UAE’s drastic cut in oil production, despite President Biden’s overtures to both countries in recent months, is a hostile act against the United States and a clear signal that they have chosen to side with Russia in its war against Ukraine,” Democrat House Representatives Sean Casten, Tom Malinowski, and Susan Wild said in a joint statement on Thursday.

The group introduced a new bill on Wednesday that aims to end the US military support to Saudi Arabia.

“We see no reason why American troops and contractors should continue to provide this service to countries that are actively working against us,” they said.

Russia hails OPEC+ for slashing output, says it countered US 'mayhem' in global energy markets

Russia hails a decision by OPEC+ to reduce oil production despite US opposition, saying it successfully countered the "mayhem" sown by Washington in global energy markets.

Several congressional Democrats have had similar remarks on the announcement, which is poised to counter-sanctions on Russian oil and potentially drive up gas prices ahead of the midterm US elections.

Yellen declined to outline to the Financial Times any steps American officials would take to counter OPEC+’s production cut, which threatens to cause an increase in domestic gas prices.

“The president has been focused for a lot of time on exploring all available options to try to bring [oil prices] down,” Yellen said.

Independent US Senator and former Democratic presidential candidate Bernie Sanders has called for the withdrawal of American troops from Saudi Arabia and an end to military aid to the conservative kingdom for lowering oil production.

“If Saudi Arabia, one of the worst violators of human rights in the world, wants to partner with Russia to jack up US gas prices, it can get Putin to defend its monarchy,” the Vermont senator tweeted Friday.

Sanders calls for US troop withdrawal from Saudi Arabia, end of selling weapons

Bernie Sanders has called for the withdrawal of American troops from Saudi Arabia and an end to military aid to the conservative kingdom for lowering oil production.

“We must pull all US troops out of Saudi Arabia, stop selling them weapons & end its price-fixing oil cartel,” he added.

In August, the United States approved massive arms sales to Saudi Arabia and the United Arab Emirates worth more than $5 billion, amid criticism of their ongoing military aggression in Yemen which has inflicted heavy civilian casualties.

The State Department said Saudi Arabia would buy 300 Patriot MIM-104E missile systems and related equipment for an estimated $3.05 billion. The missile systems can be used to shoot down long-range incoming ballistic and cruise missiles, as well as fighter jets.

Separately, the United States will sell Terminal High Altitude Area Defense (THAAD) System Missiles and related equipment to the UAE for $2.25 billion.

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