Resolving the OPEC+ Impasse: is the US intervention imminent?

 

Saudi UAE Spat

With no prospect of the next OPEC+ ministerial meeting to get round the impasse involving its key players in the Middle East, the likelihood of the direct intervention by the US has increased dramatically.

Since the price of crude oil rose to the highest in three years, the price at pumps has worried both economists and key policy makers in the West; the inflationary pressure is growing which could potentially derail the feeble revival of the economies across the world; the emergence of new variants of the Coronavirus is not encouraging news either.

The White House admitted that the US administration took up the issue with the relevant parties in the OPEC+. By coincidence, the Deputy Saudi defence minister travelled to the US on Tuesday to meet the Pentagon officials.

“We’re not a party to these talks but over the weekend and into this week, we’ve had a number of high-level conversations with officials in Saudi Arabia, the UAE and other relevant partners,” said Jen Psaki, the White House press secretary.

She, however, said that the US administration is monitoring the global supply and made it clear that the Biden administration wanted the American to have access to affordable and reliable energy; she implied the how serious the team is about the price of oil at the pumps.

The price of crude oil, meanwhile, stumbled in response to the new development, despite the stalled talks over reviving the JCPOA, 2015 Iranian nuclear deal; the possibility of Iran returning to the crude oil markets as a normal player looks bleaker than it was few weeks ago.

Analysts believe when the deputy Saudi defence minister is back in the Kingdom, there will be some movements to restart the negotiations of the OPEC+, with the UAE and Saudi Arabia finding some common ground to reach a compromise.; it remains to be seen, though.

Saudi Arabia has taken some harsh economic measures against its long-term ally, the UAE; the UAE has not responded in kind – a good sign that the dispute may be resolved with the US help.

 

 

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