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Iraq, Algeria, Oman, Kuwait and Bahrain Affirm Support for OPEC+ Production Cut

Assurances from OPEC members on the importance of reducing production refute US allegations (Reuters)
Assurances from OPEC members on the importance of reducing production refute US allegations (Reuters)
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Iraq, Algeria, Oman, Kuwait and Bahrain Affirm Support for OPEC+ Production Cut

Assurances from OPEC members on the importance of reducing production refute US allegations (Reuters)
Assurances from OPEC members on the importance of reducing production refute US allegations (Reuters)

OPEC+ member states lined up on Sunday to endorse the production cut agreed this month after the US had accused Riyadh of coercing some other nations into supporting the move.

Algeria's Energy Minister Mohamed Arkab called the decision “historic” and expressed his full confidence in it, Algeria's Ennahar TV reported.

“There is complete consensus among OPEC+ countries that the best approach in dealing with the oil market conditions during the current period of uncertainty and lack of clarity is a pre-emptive approach that supports market stability and provides the guidance needed for the future,” Iraq's state oil marketer SOMO said in a statement.

Iraq is OPEC’s second largest oil producer.

SOMO’s statement explained that “there is a close link between the demand for oil and the growth of the global economy, as one is greatly affected by the other.”

The International Monetary Fund (IMF) had indicated that the global economy is on the verge of recession at a very large rate.

“If a global recession takes place, it will reduce the demand for crude oil,” SOMO explained, adding that the oil production cut decision by OPEC+ was necessary to achieve market balance considering the deteriorating situation.

Kuwait Petroleum Corporation Chief Executive Officer Nawaf Saud al-Sabah also welcomed the decision by OPEC+ and said the body was keen to maintain a balanced oil market, state news agency KUNA reported.

Oman and Bahrain said in separate statements that OPEC had unanimously agreed on the reduction.

Oman’s Energy Ministry said that the decision to cut oil production by 2 million barrels per day was necessary to reassure the market and stabilize it.

The ministry said that OPEC+ decisions are based on purely economic considerations and realities of supply and demand in the market.

The Organization of Arab Petroleum Exporting Countries (OAPEC) said on Saturday that the decision of OPEC+ to cut its oil production target was exact and was taken at the right time.

OAPEC comprises Algeria, Bahrain, Egypt, Iraq, Kuwait, Libya, Qatar, Saudi Arabia, Syria, Tunisia and the UAE.

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US Treasury Targets Russia's Gazprombank with New Sanctions

FILE PHOTO: A bronze seal for the Department of the Treasury is shown at the US Treasury building in Washington, US, January 20, 2023. REUTERS/Kevin Lamarque/File Photo
FILE PHOTO: A bronze seal for the Department of the Treasury is shown at the US Treasury building in Washington, US, January 20, 2023. REUTERS/Kevin Lamarque/File Photo
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US Treasury Targets Russia's Gazprombank with New Sanctions

FILE PHOTO: A bronze seal for the Department of the Treasury is shown at the US Treasury building in Washington, US, January 20, 2023. REUTERS/Kevin Lamarque/File Photo
FILE PHOTO: A bronze seal for the Department of the Treasury is shown at the US Treasury building in Washington, US, January 20, 2023. REUTERS/Kevin Lamarque/File Photo

The United States imposed new sanctions on Russia's Gazprombank on Thursday, the Treasury Department said, as President Joe Biden steps up actions to punish Moscow for its invasion of Ukraine before he leaves office in January.
The move, which wields the department's most powerful sanctions tool, effectively kicks Gazprombank out of the US banking system, bans its trade with Americans and freezes its US assets, Reuters reported.
Gazprombank is one of Russia's largest banks and is partially owned by Kremlin-owned gas company Gazprom. Since Russia's invasion in February 2022, Ukraine has been urging the US to impose more sanctions on the bank, which receives payments for natural gas from Gazprom's customers in Europe.
The fresh sanctions come days after the Biden administration allowed Kyiv to use US ATACMS missiles to strike Russian territory. On Tuesday, Ukraine fired the weapons, the longest range missiles Washington has supplied for such attacks on Russia, on the war's 1,000th day.
The Treasury also imposed sanctions on 50 small-to-medium Russian banks to curtail the country's connections to the international financial system and prevent it from abusing it to pay for technology and equipment needed for the war. It warned that foreign financial institutions that maintain correspondent relationships with the targeted banks "entails significant sanctions risk."
"This sweeping action will make it harder for the Kremlin to evade US sanctions and fund and equip its military," Treasury Secretary Janet Yellen said. "We will continue to take decisive steps against any financial channels Russia uses to support its illegal and unprovoked war in Ukraine."
Gazprombank said Washington's latest move would not affect its operations. The Russian embassy in Washington did not respond to requests for comment.
Along with the sanctions, Treasury also issued two new general licenses authorizing US entities to wind down transactions involving Gazprombank, among other financial institutions, and to take steps to divest from debt or equity issued by Gazprombank.
Gazprombank is a conduit for Russia to purchase military materiel in its war against Ukraine, the Treasury said. The Russian government also uses the bank to pay its soldiers, including for combat bonuses, and to compensate the families of its soldiers killed in the war.
The administration believes the new sanctions improve Ukraine's position on the battlefield and ability to achieve a just peace, a source familiar with the matter said.
COLLATERAL IMPACT
While Gazprombank has been on the administration's radar for years, it has been seen as a last resort because of its focus on energy and the desire to avoid collateral impact on Europe, a Washington-based trade lawyer said.
"I think that the current administration is trying to put as much pressure and add as many sanctions as possible prior to January 20th to make it harder for the next administration to unwind," said the lawyer, Douglas Jacobson.
Officials in Slovakia and Hungary said they were studying the impacts of the new US sanctions.
Trump would have the power to remove the sanctions, which were imposed under an executive order by Biden, if he wants to take a different stance, Jacobson said.
After Russia's invasion in 2022, the Treasury placed debt and equity restrictions on 13 Russian firms, including Gazprombank, Sberbank and the Russian Agricultural Bank.
The US Treasury has also worked to provide Ukraine with funds from windfall proceeds of frozen Russian assets.