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Oil and Elections… Have US Actions Backfired?

Oil and Elections… Have US Actions Backfired?

Monday, 17 October, 2022 - 10:15
Salman Al-Dossary
Salman Al-Dossary is the former editor-in-chief of Asharq Al-Awsat newspaper.

Days ago, Riyadh sent Washington, through a foreign ministry statement, a strongly-worded message firmly pushing back against claims that the OPEC+ decision reflects a position on international conflicts.


The statement also stressed that the decision was unanimous and taken on economic grounds, as it aimed to create a balance in supply and demand and to limit volatility.


Most importantly, it made crystal clear who is using oil as a political tool and who is committed to safeguarding the interests of both producers and consumers. The rest of the story is well known; we all saw how the actions of the US backfired.


Saudi Arabia, as well as other countries, have made clear (and continue to do so) to the US administration the importance of their relationship and shared interests, that Saudi Arabia cannot exploit economic issues for political ends, and that the Kingdom cannot be on one faction’s side, seeking to improve the victory chances of the other side.


Indeed, Riyadh gives its relationship with Washington full attention and sees it as pivotal, but it cannot be prioritized at the expense of Saudi interests. The Kingdom has expressed its point of view candidly and clearly, and it did the right thing with its reasonable stance regarding the demand for postponing cuts in oil production.


This stance was taken first for well-established economic reasons and second because the request had been a political trap that the Kingdom averted wisely and firmly, without niceties.


One matter that has been kept quiet about and should be prioritized in discussions is the constant and continuous US assault on oil prices, which is intended to conceal its unprecedented destabilizing actions to manipulate gas markets.


This was exposed by one of its allies, French President Emanuel Macron, when he said: We are going to say with great friendship toward our American friends, our Norwegian friends, that 'you are great, you provide us with gas.' But there is one thing that can't work for a very long time, that is we can't pay for gas that is four times more expensive."


Let me tell you the story chronologically. It has already been reported, and it is well-known. However, it is a complex issue, and the story has been told in bits and pieces. That is why I have connected this scattered series of events together to clarify what happened- what the Democrats do not want to say clearly… at least from my point of view as a journalist.


First and foremost, although it is a purely economic question, its foundations are political. Since the Biden administration made the issue of climate a top priority, all the countries of the West have become excessively concerned with the matter and have been discussing it passionately.


The implications of this have accumulated, leading to an end to investments in fracking, with countries like Britain, for example, having halted investments in petroleum before reversing this decision recently. With this wave of enthusiasm for the climate, countries “that have other resources like coal and gas” went back to using them. Nonetheless, no one presents these developments in the same way that they put forward questions regarding oil, and this is where the secret games of the media come into play… It is one of the reasons why coal has made a strong comeback in Britain and why the United States has gone back to gas- despite the fact that coal is particularly bad for the environment; rather, it is worse than oil.


Through the concerted efforts of the members of OPEC+, oil markets have been kept stable; in fact, oil is the only commodity that did see significant price rises. Prices are stable and transparent, and we should always keep in mind that an organization (OPEC+) is managing this market successfully, preventing shocks or disasters for the global economy.


In fact, it has succeeded, to a large extent, in ensuring balance and stability in the markets. Meanwhile, no similar organization does the same for gas or coal, for example, leading prices to spike unfathomably, rising to multiples of what they had been. Of course, when it comes to this question, no one is willing to point fingers and assign blame.


With the latest cuts made around two years ago, US President Donald Trump personally contacted the president of Mexico and asked him to cut his county’s share and to push for a general agreement and meeting of OPEC+; the goal was to protect US interests.


The question here is: why are gas and coal prices so high? The direct answer: because of supply shortages and the Russian-Ukrainian crisis. The US administration does not want to recognize the first segment so that it can exploit the second.


We should always remember that the petroleum market was politicized because it is successful, despite the fact that OPEC has always worked to safeguard the interests of both consumers and producers, as well as to protect investments and balance supply with the demands of the market. It creates a balance that serves producers so they can continue producing, and it serves consumers by making prices balanced and averting volatility.


Saudi Energy Minister Prince Abdulaziz bin Salman confirmed this matter recently, stressing that OPEC+ is committed to safeguarding the interests of both producers and consumers and that it will continue to fulfill its duty on the markets. He added that OPEC+ will remain a pivotal guarantor of the global economy’s stability and that its recent steps had been taken out of necessity- not only for OPEC+ members but all oil-exporting countries.


Oil prices, with all the clamor that comes with them, remain temporary. Saudi Arabia has a fixed, sovereign position. It takes its decisions independently, as was apparent in the strongly-worded statement. Most importantly… and this is something many seem unaware of, what is happening with oil markets is only one of many issues and political stances, but the others are not usually discussed publicly.


In the end, Saudi Arabia has demonstrated, as it does every time, that it alone can tolerate attacks and false accusations like none of its opponents can, despite the fact that its stance is 100 percent correct.


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