OPEC Plus suggested in a news release that it was responding to a reopening from lockdowns in countries like China. Not mentioned was pressure from Washington for an increase in supply to address rising prices.
The Saudis are trying to improve their relationship with the Biden administration, which wants to prevent soaring oil prices from alienating American voters in midterm elections and damaging the economies of the United States and other countries. But Riyadh also does not seem to want to break its five-year alliance on oil matters with Moscow, which is a co-leader of OPEC Plus.
Oil prices, which had fallen about 3 percent before the meeting as traders anticipated a significant increase in production, reversed direction after the OPEC Plus announcement, with West Texas Intermediate crude, the U.S. benchmark, up more than 1 percent, to nearly $117 a barrel.
Nevertheless, the OPEC Plus decision received praise from the White House.
“The United States welcomes the important decision from OPEC Plus today to increase supply by more than 200,000 barrels per day in July and August based on new market conditions,” the White House press secretary, Karine Jean-Pierre, said in a statement.
The Russia-Ukraine War and the Global Economy
A visit by President Biden to Saudi Arabia has been under consideration, but the White House would not confirm any plans. Asked about possibility of a trip, Ms. Jean-Pierre said on Wednesday that Mr. Biden stood by his vow to make Saudi Arabia a pariah after the brutal killing of the journalist Jamal Khashoggi in 2018.
“I don’t have a visit to preview and don’t have a trip to announce,” she said.
While the Saudis had until now shrugged off requests for more oil, blaming high prices on geopolitics and shortages of refining capacity, analysts say they may now be concerned that real shortages that could damage the world economy and cut demand are on the horizon.
By August OPEC Plus will have, at least theoretically, returned to prepandemic production levels. Analysts say that moment could be an opportunity for the organization to reassess issues like production quotas or even Russia’s role in the organization.