Biden is ‘re-evaluating’ the relationship with Saudi Arabia after OPEC production cut – as top Democrat says kingdom wants Putin to win in Ukraine and JPMorgan CEO says America needs to pump more oil

  • White House spokesman John Kirby said Biden is reconsidering his Saudi stance
  • Added that the president is willing to work with Congress on future of relations
  • Top Democrats have called for a freeze on arm sales after the OPEC decision
  • Senator Dick Durbin said Saudi Arabia wants Russia to win the war in Ukraine 
  • JP Morgan CEO Jamie Dimon took a veiled swipe at Biden as he said the U.S. should pump more oil and gas and should have been doing so for a long time 

Biden is considering getting tough on Saudi Arabia by re-evaluating the relationship with the kingdom after OPEC+ slashed oil production last week.

‘This is a relationship that we need to continue to reevaluate, that we need to be willing to revisit,’ White House national security spokesman John Kirby said Tuesday.

Biden is willing to work with Congress on the future of Saudi relations, Kirby added in an interview with CNN, after Democratic Senator Bob Menendez called for a freeze on cooperation with Saudi Arabia, including most arms sales.

Cutting oil production in the Middle East by two million barrels a day is sure to push gas prices even higher – just one month before midterm elections – and has led to claims Saudi Arabia is ‘aligned’ with Russia.

For months, since the U.S. cut off exports of Russian oil and the European Union moved toward divestment, Moscow has instead been selling its product to Saudi Arabia. The Saudis keep Russian oil for their own use and then sell theirs on the world market.

The Democrats have now vowed to get tough on the kingdom for the production cut, after Biden fist-bumped Crown Prince Mohamed bin Salman in Jeddah in July.

Democratic Senator Dick Durbin also accused Saudi Arabia of wanting to Russia to win the war in Ukraine.

‘Do you think Saudi Arabia wants Russia to win in Ukraine?’ CNN’s John Berman asked him.

‘Yes…let’s be very candid about this. It’s Putin and Saudi Arabia against the United States,’ he responded.

Menendez, the chair of the Senate Foreign Relations Committee who has veto power over foreign arms sales, said in a statement that he ‘will not green light any cooperation with Riyadh until the Kingdom reassesses its position with respect to the war in Ukraine.’

Last week Durbin, the Senate’s no. 2 Democrat, wrote in a tweet Saudi Arabia has ‘never been a trustworthy ally’ and it’s time for the U.S. to ‘imagine a world without their alliance.’

Energy ministers from the OPEC cartel, whose leading member is Saudi Arabia, and allied non-members including Russia met in person at the group’s Vienna headquarters last week for the first time since early 2020.

Their announced production cutback on Tuesday is the largest since the start of the COVID-19 pandemic.

Just this summer Biden made a trip to the Middle East and met with crown prince Mohammed Bin Salman to discuss energy security and soaring gas prices in the U.S. To avoid a problematic handshake with the leader Biden fist bumped bin Salman.

Last week’s announcement will boost Russian oil prices to bankroll the Kremlin’s invasion of Ukraine. It also thwarts the West’s efforts to choke off Moscow’s energy dollars.

JP Morgan CEO Jamie Dimon took a veiled swipe at Biden as he said the U.S. should pump more oil and gas and should have been doing so for a long time.

‘In my view, America should have been pumping more oil and gas and it should have been supported,’ the famed billionaire chairman told CNBC on Monday.

‘America needs to play a real leadership role. America is the swing producer, not Saudi Arabia. We should have gotten that right starting in March,’ he added.

In retaliation, Rep. Ro Khanna of California and Senator Richard Blumenthal of Connecticut called for new legislation to ‘immediately halt all U.S. arms sales’ to the Middle Eastern kingdom, which leads OPEC+, in a joint editorial published in Politico on Sunday.

They blasted Russia’s autocratic leader Vladimir Putin as a ‘nuclear bomb extortionist’ for his increasingly hostile threats to use such force in Ukraine.

OPEC+’s cutback of 2 million oil barrels per day will ‘worsen global inflation, undermine successful efforts in the U.S. to bring down the price of gas, and help fuel Putin’s unprovoked invasion of Ukraine,’ the lawmakers wrote.

Other Democrats joined a chorus of criticism of longstanding U.S. policy toward Saudi Arabia.

‘I thought the whole point of selling arms to the Gulf States despite their human rights abuses, nonsensical Yemen War, working against US interests in Libya, Sudan etc, was that when an international crisis came, the Gulf could choose America over Russia/China,’ Sen. Chris Murphy, D-Conn., tweeted.

Prices are now likely to continue to surge as crude oil prices climb, according to Patrick De Haan, the chief petroleum analyst at GasBuddy.

In a blog post on Monday, he wrote: ‘With OPEC+ deciding to cut oil production by 2 million barrels a day, we’ve seen oil prices surge 20 percent, which is the primary factor in the national average rising for the third straight week.’

De Haan now expects prices to rise as much as $0.30 from their September lows, creeping toward $4 a gallon. The average price on Tuesday was $3.92, up 12 cents from one week ago.

Andy Lipow, president of Lipow Oil Associates LLC consultancy, also said he expects drivers throughout the US to soon shell out $4 a gallon, according to NBC News.

In a note to clients on Monday, he explained that gasoline reserves have plummeted across much of the United States because the lower prices have driven up demand.