The news: The Biden administration is in an escalating war of words with the government of Saudi Arabia — a debate that may do lasting damage to one of the longest-standing strategic partnerships the U.S. has in the Middle East.
Washington is enraged at the kingdom following the Oct. 5 decision by the Saudi-led Organization of the Petroleum Exporting Countries (OPEC+) to slash oil output by 2 million barrels a day. The move is already driving up the price of oil, which will help Russia, the world’s second-largest oil exporter, continue its ongoing war in Ukraine in the face of international sanctions. A rise in gas prices would also be very unwelcome for President Joe Biden’s Democrats just weeks ahead of midterm elections.
The Saudi foreign ministry has said the move was a consensus decision among OPEC+ members in response to market conditions. National Security Council spokesman John Kirby pushed back on Thursday, accusing the Saudis of trying to “spin or deflect,” and claimed that other OPEC+ members had been pressured into going along with a decision they did not believe was justified by the markets. White House press secretary Karine Jean-Pierre said the Saudis were backing the Kremlin at the expense of the U.S. and other Western nations: “They are certainly aligning themselves with Russia. This is not a time to be aligning with Russia.”
Biden himself has accused the Saudis of siding with Russia and the president vowed that “there will be consequences,” without specifying what those might be.
If anything, the anger on Capitol Hill is more palpable and the suggested response more specific. Sen. Robert Menendez (D-N.J.), chair of the Senate Foreign Relations Committee, has said the U.S. should immediately freeze all cooperation with the Saudis. A bill introduced in both the House and Senate would halt all arms sales to Saudi Arabia for one year. Democratic California Rep. Ro Khanna, the bill’s House sponsor, said, “There is no reason for the U.S. to kowtow to a regime that has massacred countless civilians in Yemen, hacked to death a Washington-based journalist and is now extorting Americans at the pump.”
As for the Saudis, the move seems to be a clear indication that after years of frustration with American lectures, they’re done taking marching orders from Washington.
Politics: The president and the prince
Biden came into office pledging to make Saudi Arabia’s de facto ruler, Crown Prince Mohammed bin Salman, a “pariah” for the murder of Washington Post journalist and U.S. resident Jamal Khashoggi — as well as for the kingdom’s discriminatory treatment of women, repression of dissent, and alleged war crimes in Yemen. Biden sought to draw a contrast with former President Donald Trump, who consistently defended and praised the kingdom as an ally against Iran and customer for U.S. weaponry. Around the time Biden took office, the Saudi government released several prominent women’s rights activists and lifted a blockade on neighboring Qatar, in what were widely seen as overtures to the new administration.
Since taking office, Biden has toned down the rhetoric and tried to walk a thin line on Saudi Arabia. The U.S. has ended its formal support for the war in Yemen, but continued selling the weapons the Saudis have used to fight that war. The administration released previously classified U.S. intelligence directly implicating the crown prince in Khashoggi’s murder but then declined to sanction him personally.
The balancing act tipped sharply toward the Saudis in June, when Biden made a controversial trip to Saudi Arabia and shared a now infamous fist bump with the prince he had vowed to isolate. (According to the New York Times, Biden was reluctant to make the trip but was persuaded by his advisers.) In the wake of the OPEC decision, Biden has come under renewed fire for going — to which he has responded that it was “not essentially for oil.”
Oil may not have been the only justification for the Saudi trip, which also involved talks on Iran policy and encouraging normalization with Israel. But the need to keep global oil supplies high and gas prices as low was certainly a major factor behind Biden’s decision to go.
It doesn’t seem to have paid off. The Wall Street Journal reported that U.S. officials had called their Saudi counterparts to lobby against an OPEC production cut, and the Saudi Foreign Ministry said the U.S. had pressed for a monthlong delay in the decision; both asks were rejected.
Khalid Aljabri, a U.S.-based Saudi dissident from a once-prominent political family whose siblings have been imprisoned in Saudi Arabia, told Grid that the Biden administration’s public questioning of the alliance is long overdue. “I’m glad that they’re coming to reality. This is a moment of reckoning,” said Aljabri. Still, he said, he’s not getting his hopes up for a major policy shift. “I came away with the impression that the Biden administration still doesn’t have at least a list of meaningful consequences that they can impose on [Mohammed bin Salman].”
Energy: Crude calculations
OPEC is a cartel of 13 oil-producing countries, mainly in the Middle East and Africa, that coordinates to set production targets in response to global economic conditions. In 2016, they joined with 10 other countries including Russia to form “OPEC Plus.” Saudi Arabia is the most influential country in the group because it’s the only one with a significant amount of “spare production capacity,” meaning the Saudis could produce millions of barrels of oil more per day than they actually do, and bring production online quickly or shut it down at will.
OPEC and the Saudi government have justified this latest production cut as a defensive move to keep prices stable, given that many analysts are predicting a global recession and an economic slowdown in China. Brent crude prices fell from over $123 in early June to a low of around $84 in late September, but in the wake of the OPEC announcement, surged to around $98.
A rise in oil prices is welcome news for Russian President Vladimir Putin, whose government relies on oil and gas revenues for one-third of its budget and, because of Western sanctions, is currently forced to sell its oil at a steep discount to those countries still willing to buy. A price hike also increases the pain for European consumers who are already facing a bleak winter of high energy prices and economic stagnation. That’s one more piece of welcome news for Putin, who hopes to divide the coalition of countries backing Ukraine and this week offered to resume natural gas shipments to Germany via the now-stalled Nord Stream 2 pipeline.
Even though the U.S. now exports more oil than it imports, it remains susceptible to fluctuations in the global market, and the price of petroleum is a major determinant of the price Americans pay for gas at the pump. The average price for gas in the United States is down significantly from when it peaked at over $5 per gallon in June, but in recent weeks gas prices have started to rise again.
The Biden administration denies that its pressure on the Saudis has anything to do with domestic politics, but it’s true that Democratic congressional candidates have fared better in the polls as gas prices have fallen in recent months, and that those two trends are almost certainly connected. This may be an added bonus for the Saudi government, which has made very clear that it preferred dealing with the much more cooperative Trump administration.
Geopolitics: The not-so-special relationship
The Biden administration has made the case that for all its flaws as a partner, Saudi Arabia is a partner worth keeping, and not only because of oil. Officials argue that the Saudis have been allies in countering Iran’s influence throughout the Middle East and noted the possibility that Saudi Arabia may normalize ties with Israel. (Saudi Arabia has not joined with other countries in the Trump-initiated “Abraham Accords,” and still doesn’t formally recognize the Jewish state, but relations between the two countries have improved.)
But right now the Biden administration has few larger priorities than the war in Ukraine, and OPEC’s unhelpful move has officials publicly musing about whether the Saudi relationship is still worth the trouble. National Security Adviser Jake Sullivan said the White House’s review process would examine the question, “Is the nature of the relationship serving the interest and values of the United States, and what changes would make it better serve the interests and values?”
That’s a tough question, and asking it publicly may suggest a major rupture in the relationship, but some perspective is needed. In the 77 years since the U.S.-Saudi partnership began with a meeting between President Franklin D. Roosevelt and bin Salman’s grandfather, Ibn Saud, on the deck of a ship in the Suez Canal, it has faced no shortage of ruptures.
Bruce Riedel, a former CIA analyst and veteran Saudi watcher now at the Brookings Institution, told Grid that the current crisis is far from the worst. He gives that honor to the 1973 oil embargo, during which OPEC cut off oil supplies to the U.S. in retaliation for American support for Israel during that year’s Yom Kippur War. And amid today’s warnings that Saudi Arabia might shift from the U.S. alliance toward a closer partnership with Russia and China, it’s worth remembering that Saudi Arabia made similar threats during President Barack Obama’s administration, when relations reached a nadir over disagreements on the Syrian civil war and the Iran nuclear agreement. There are already some signs that the Saudis are looking for ways to patch things up. The kingdom announced a $400 million aid package for Ukraine on Saturday.
In Riedel’s view, this crisis is less about any fundamental political shift than about “a personality, [Mohammad bin Salman], which is not susceptible to policy changes. He is reckless and dangerous, which Biden should have known from the beginning.”
That may be true. But even if this is just a matter of one personality, it’s a personality that is likely to be at the helm of power for a long time. The crown prince is 37 years old, and most Saudi-watchers don’t think he has any serious rivals for the throne. Biden won’t be the last president to try to figure out how to deal with him.
Saudi Arabia Defied U.S. Warnings Ahead of OPEC+ Production Cut (Wall Street Journal)
Saudi oil cuts and American international order (Abu Aardvark’s MENA Academy)
Thanks to Alicia Benjamin for copy editing this article.