Biden’s new problem; Saudi efforts to increase the price of oil.
This English newspaper wrote that the resumption of efforts by Saudi Arabia and Russia to increase the price of oil and bring it to $100 per barrel has become a new challenge for Biden, who is using economic records and deflation as the focus of his election efforts.
Last week, the price of Brent crude oil reached $90 per barrel for the first time in 2023. This increase occurred at the same time as Riyadh and Moscow decided to extend the supply reduction of this product until the end of the year.
According to the Financial Times, Saudi Arabia’s move to increase oil prices also risks a new dispute between Saudi Arabia and Washington. The US is trying to reach a historic deal to normalize relations between Riyadh and Tel Aviv and strengthen the alliance against Russia at this week’s G20 summit in India.
Raad al-Qadri, an analyst at the Eurasia Group in Washington, said: “The Saudis currently do not have many friends in Washington.” If Washington wants to blame someone again for high prices or a slow economy, there is a real risk that the Saudis will be made the main culprits.
The extension of oil supply cuts also comes at a critical time for the White House in terms of domestic issues in Washington. The White House has tried to show that the economy is strong and inflation is under control; A case that shows what is being described as “Bidennomics” (Biden’s economic policy) is working well.
In the US, the price of oil plays an important role in how voters perceive the economy, and analysts say that supply cuts could push the price of oil to $100 a barrel before the end of this year, pushing up fuel costs at the same time. Reduce inflation in Western economies.
Economist and former Federal Reserve employee Alan Detmeister said he expects a “fairly significant” increase in the consumer price index in August due to higher gasoline costs. He also expects the September data, which will be released in October, to increase further.
This economist also said that the slower increase in product prices in other sectors can compensate for the inflation caused by the increase in energy costs, but the price of oil can easily increase the annual inflation rate in the United States to at least 4% in September. to give The inflation index in America is now 3.2%.
The pressure to increase prices in American gas stations is obvious; Where prices have risen by nearly a quarter this year to $3.80 per gallon. That’s down from a record high of more than $5 set last summer — but still 60 percent above the level it reached when Biden took office in January 2021.
Inflation caused by fuel prices has become an excuse to criticize Biden’s Republican opponents on the eve of the presidential election. Republicans blame the White House for prioritizing climate policy over domestic oil production.
Chris Christie, the former governor of New Jersey, who participated in the Republican primaries, said that Biden’s cold relations with Riyadh led to the decision of Saudi Crown Prince Mohammed bin Salman to “deal with Russia” to further reduce oil supply.
The American official said on the Fox Business program that with this decision, the Saudi Crown Prince sent the message to Biden that we will have good relations with Russia.
