The White House terrified by the cut in production planned by Opec +
Probably today OPEC + will cut its oil production quotas by 500,000 – 2,000,000 barrels extracted per day, to prevent a drop in the price of oil linked to a drop in consumption due to the global economic crisis that appears at the gates. Surely this decline cannot be offset by an increase in US shale oil production. The result will be a rise in prices that will reignite inflation and fuel prices on the eve of the US primary elections, and this is sending the White House into crisis, which is trying to avoid or minimize the cut in every way.
According to a CNN report, all human resources available in the administration have been mobilized, with the White House "in spasm and panic," according to an unnamed official.
"It is difficult to overstate the Biden administration's anxiety about a potential recovery in oil prices," Bob McNally, of Rapidan Energy, told Bloomberg ahead of the OPEC + meeting in Vienna today.
"A major cut by OPEC + would antagonize the White House, although officials may wait to see how prices react before pulling the trigger on policy responses."
In fact, CNN reports that some of the urgent White House talking points have suggested that the cut in OPEC + production is seen as "a hostile act."
Figures such as Amos Hochstein, Janet Yellen and Brett McGurk were tasked with advocating the no to cuts with the Gulf countries, and CNN said the Secretary of the Treasury's talking points would focus on potential reputational damage in the West for OPEC Gulf members supporting the cut.
"There is a great political risk to your reputation and your relations with the United States and the West if you move forward," CNN said, citing draft talking points. The main argument that is put forward in lobbying, however, is that of the negative effect that the tightening of the oil supply would have on the global economy at this time, an effect that could cause the economy to fall vertically and therefore further reducing the demand for hydrocarbons, creating a negative cycle that would damage the producers themselves.
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The article The White House terrified by the cut in production planned by Opec + comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/la-casa-bianca-terrorizzata-dal-taglio-della-produzione-previsto-da-opec/ on Wed, 05 Oct 2022 08:00:06 +0000.