Biden Prepares to “Re-Evaluate” U.S.-Saudi Relationship
The U.S.-Saudi relationship plunged deeper into uncertainty on Tuesday when Biden administration officials said Washington planned to “re-evaluate” relations over OPEC+’s decision to slash oil production.
Led by Saudi Arabia, the group of top oil producers had decided to slash oil production by 2 million barrels per day—although the actual difference will likely be smaller since many were already missing their output targets. U.S. President Joe Biden had previously pushed to boost production to drag down prices and shake Russia’s finances, which depend on oil export revenues.
“The U.S. has definitely taken this as a snub,” said Amrita Sen, the co-founder of Energy Aspects, an energy consultancy. “There’s a lot of anger against Saudi Arabia right now.”
But as fears of a global recession grow, experts say Saudi Arabia also has key economic reasons for propping up prices—namely that elevating prices now could help shield it from lower revenues due to an economic slowdown. Oil producers are also rattled by Washington’s push for a Russian oil price cap, which would effectively create a situation in which consumers set a lower market price at which the commodity is sold.
“For OPEC, this is a pre-emptive cut,” said Sen, who noted that the U.S. Federal Reserve Bank’s interest rate hikes have helped spur a slowdown in the global economy. “They want to get ahead of it. That’s why they did it.”
Within Washington, OPEC+’s decision fueled pressure for Biden to halt weapons sales to Riyadh, with Senator Bob Menendez urging him to “immediately freeze all aspects of our cooperation with Saudi Arabia.”
“Enough is enough,” he added.
Such turmoil has long roiled the U.S.-Saudi relationship. In April 2020, FP’s Keith Johnson and Robbie Gramer chronicled how the two countries’ “rocky marriage of convenience” evolved—and came close to a breaking point—in the decades since its inception.
“Today’s tensions stem, in many ways, from the original foundations of the odd-couple relationship: an oil-for-security bargain that always sought, but never fully managed, to bridge the divide between a liberal democracy and a conservative religious monarchy,” they wrote.
The same tensions are now making a resurgence—although, like before, their ties may ultimately withstand the pressures.
Even though the relationship has had its difficulties, “both countries have come back as well,” said Sen. “Both countries do need each other—one for the energy, one for security.”