US Energy Envoy: "OPEC+ Actual Production Cut Will Amount to 500,000 Barrels... Political Decision"

"Biden, Extremely Disappointed" Warning to Saudi Arabia
"Strategic Oil Reserves to Be Released in Line with Russia Oil Price Cap Implementation"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Hyunwoo Lee] Amos Hochstein, the White House Senior Advisor for Energy Security and the U.S. energy envoy under the Joe Biden administration, criticized the OPEC+ production cut decision as a political rather than an economic decision. He pointed out that the actual production cut by these countries would be around 500,000 barrels, not the previously announced 2 million barrels.

On the 23rd, Hochstein appeared on CBS News and stated, "The actual scale of OPEC+ production cuts may be only about a quarter of the announced 2 million barrels," adding, "Such a level of production cut will not have a significant impact on the market, so this can be seen more as a political decision."

Earlier, on the 5th, OPEC+ announced a decision to reduce daily crude oil production by 2 million barrels starting next month. The U.S. strongly opposed this, calling it a political decision that financially supports Russia, which invaded Ukraine. In an unusual move, President Biden himself criticized it as a "short-sighted decision" and announced plans to reconsider diplomatic relations with Saudi Arabia, which led the OPEC+ decision.

Hochstein emphasized, "President Biden is extremely disappointed and believes this decision is a mistake," adding, "No one can say this is based on economic reasons." Previously, Saudi Arabia and other major Middle Eastern OPEC+ members explained that the production cut decision was a purely economic decision without political intent.

In response to OPEC+'s production cut decision, the U.S. government plans to implement a price cap on Russian crude oil together with the European Union (EU) and release strategic petroleum reserves in line with the implementation period of this measure. When asked about the impact on oil prices if the Western price cap on Russian crude oil is implemented in December, Hochstein stressed, "That is why President Biden announced the release of strategic petroleum reserves starting in December when the price cap will be enforced."

He further highlighted that gasoline prices have decreased due to the Biden administration's policies, stating, "We are working in cooperation with Europe, the other G7 countries, and Asian nations to ensure that Russian oil continues to be supplied to the market while suppressing the oil prices, which are the revenues Russia can earn from it."

This content was produced with the assistance of AI translation services.