Kingdom Lashes Out Over Dipping Into Reserves As US Does It First
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Alaina
- . October 26, 2022
- . Update: November 11, 2022 1:22 am
The United States has dipped into its strategic reserves of oil and Saudi Arabia is not happy about it. The Kingdom has called it a simple attempt to ‘manipulate markets.’ Speaking at an investor conference in the Saudi capital, Prince Abdulaziz bin Salman shared that he felt, “People are depleting their emergency stocks, had depleted it, used it as a mechanism to manipulate markets while its profound purpose was to mitigate shortage of supply. However, it is my profound duty to make it clear to the world that losing emergency stock may become painful in the months to come.”
He might not have singled out one country over this statement, as he didn’t name the US categorically. But there are indications to believe this might be true as the US itself had made a declaration to have dipped into its reserves due to a decision that the Kingdom took a few days ago.
According to the US, Saudi Arabia has favoured Russia when it has taken the decision of curtailing its oil production, despite insistence by the US. Last week US President Joe Biden announced he was putting the final 15 million barrels on the market from a record release of US strategic reserves. That tranche was to complete a 180-million-barrel release authorised in the spring, in response to price hikes linked to Russia’s invasion of Ukraine.
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A decision by the OPEC+ oil cartel, which Riyadh co-leads with Moscow, to cut oil production by two million barrels a day from November. The Kingdom had retorted to allegations of siding with Russia by saying that it should be understood that siding could have been done with Iran also, as both Russia and Iran are OPEC+ members, but the oil productions have still been cut down.
Meanwhile, the secretary general of OPEC Haitham Al-Ghais said on Sunday that the organization does not target a specific price, but rather targets balance between supply and demand. “Slow economic growth reflects on oil demand and OPEC+ took a pre-emptive decision,” he said.
“The stability of oil markets is important for the future; it is not only about today. Our decisions are purely technical,” the official said.
