OPEC, the Organization of Petroleum Exporting Countries, is reportedly considering a production cut of one million barrels per day — which is causing panic within the Biden administration.
President Joe Biden’s favorability among the American people has been negatively impacted by gas prices throughout his presidency, and a cut in oil production from OPEC will likely make that problem worse.
The main reason behind the potential production cut is reduced demand within China, as the communist country has continued its harsh lockdown of cities because of COVID outbreaks. Over the past four months, China’s reduced demand — along with recession fears in other countries — has led to a reduction in the price of oil from $120 per barrel to less than $90. Last month, OPEC reduced production by 100,000 barrels per day.
Some reports, including a segment from FOX Business host Stuart Varney, have indicated that the cut in production could even go as high as two million barrels per day.
Responding to the news during an appearance on CNN’s “The Lead” on Tuesday, CNN Senior National Security Correspondent Alex Marquardt asserted that the White House is “panicking” and has begun a “furious, last-ditch, wide-scale effort” to lobby against the production cut.
According to the CNN correspondent, a “U.S. official” within the Biden administration said that “the White House, in fact, is panicking, that this is something that they desperately do not want to happen.”
“Cutting oil production means higher oil prices, it means higher gas prices,” Marquardt continued. “That, of course, is something that the Biden administration does not want to happen right now.”
The CNN correspondent went on to explain the situation with OPEC and describe the Biden administration’s response to the news.
“So, tomorrow, there’s this meeting of the oil-producing countries, this cartel known as OPEC,” Marquardt said. “It is ostensibly led by Saudi Arabia. Russia is also a member. The United States is not a member. And what we have learned, myself and our colleagues Natasha Bertrand and Phil Mattingly, is that there is this furious, last-ditch, wide-scale effort to lobby the OPEC-plus oil-producing countries to not cut oil production, that senior members of the Biden administration are reaching out to members of the cartel, including Saudi Arabia, Kuwait, and the United Arab Emirates.”
“The cartel could cut as much as 1 million barrels a day in production, that would be the biggest cut since the beginning of the pandemic,” he added. “Now, this effort is being led by the top Biden administration official for energy, Amos Hochstein. They’ve also enlisted the top White House official for the Middle East, Brett McGurk. But interestingly, they’ve also — just to show you how widespread this is — reached out to the Treasury Secretary, Janet Yellen, asking her to reach out to counterparts around the world. And we actually got talking points that the White House sent to Treasury that have very blunt language suggesting that Yellen say some of this to her counterparts. They say that this would be a ‘total disaster[,]’ it would be seen as a ‘hostile act’ against the United States. This is very blunt language. The White House says that these were draft talking points and not used. But it does give insight into how nervous they are, Jake.”
Leaked White House talking points say an OPEC oil cut would be a “total disaster” & propose threatening OPEC members.
A U.S. official said the White House is “having a spasm & panicking.”
All to avoid more domestic oil production.https://t.co/PhuMFt7jZY
— Michael Shellenberger (@ShellenbergerMD) October 4, 2022