Washington has stressed the world’s major oil producing nations over the production cuts agreed to last year and stressed they should be scrapped as nations begin to recover and their demand for energy grows.
The 13-member Organization of the Petroleum Exporting Countries (OPEC) and its OPEC+ partners, which include other major oil producers such as Russia, agreed to reduce crude oil production last year in the wake of last year’s dramatic economic downturn associated with the Covid-19 crisis.
Washington’s director of the national economic council had asked the chair of the federal trade commission to use every available tool to monitor the US gasoline market.
The US market must be protected against any potential illegal conduct that might be contributing to price increases at the pump if the global price of oil is going down.
Washington was now engaging with relevant OPEC+ members on the importance of competitive markets in setting prices, but did not mention specifically which countries US officials were speaking to.
Earlier Wednesday, a source from an unnamed nation’s OPEC+ delegation told Sputnik that the oil-producing bloc had not yet discussed Washington’s demands for increased output, but added that consultations on the matter would not be ruled out.
OPEC includes Saudi Arabia, Algeria, Angola, Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, the Republic of the Congo, the United Arab Emirates and Venezuela.
Its ten major oil-producing partners constituting OPEC+ are Russia, Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Sudan and South Sudan cooperating in determining crude oil demand in 2016, ostensibly in a bid to stabilize both prices and output.
In early 2020, Saudi Arabia began a brief crude price war against other producers after its efforts to ram through a major cut in output was rejected by other OPEC+ partners, chiefly Russia.
The conflict led to a historic glut which saw demand drop through the floor and futures temporarily dip into negative territory, but was resolved after producers reached a compromise solution on necessary cuts in April 2020.
The United States, which is not a member of OPEC+, thanked Russia and Saudi Arabia for coming to an agreement, and helped the oil producing-bloc bring a reluctant Mexico into the agreement on cuts.
Sputnik / ABC Flash Point OPEC+ News 2021.