According to government officials in the United States and Saudi Arabia, the U.S. envoy first negotiated privately, and then publicly spent several weeks trying to persuade Saudi Arabia to continue to increase production. Soon, the 36-year-old Saudi Crown Prince Salman became a key figure in the negotiations. , The reason is that he has the ability to make decisions. However, despite the constant lobbying by American diplomats, Salman did not make any concessions. The report pointed out that Prince Mohammed is more worried about the fundamentals of oil supply and demand than the demand in Washington.In the end, the Biden administration did not obtain more capacity, which forced the White House to announce the use of strategic oil reserves to increase supply. This decision may lead to OPEC+ Response.
On this issue, Dr. Jason, an expert in financial commentary, issued a comment on Voice of Hope. Jason said, “This thing is to say that he is not willing to solve the problem at his doorstep. He went to ask OPEC. Of course, OPEC hopes that the higher the oil price, the better. Saudi Arabia has made the highest money in eight years. Yes, because the price of oil has gone up.”
“The high oil price is a good thing for these oil-producing countries. They have no incentive to increase production and bring down oil prices. Historically, the United States has the ability to force them to do so because the United States has a large amount of oil production. Without increasing production, the United States will occupy the international market. Some time ago, the United States had the highest crude oil production in the world. However, he knew that the Biden administration was boycotting domestic crude oil production in the United States, so OPEC has the right to speak again. The weight of the speech is heavy again, and I know that Biden has no leverage on this side.”
He said, “(If you release crude oil reserves), how much oil can you store? That means you are in a state of sitting on the sky. If you don’t produce a lot of oil, you can take out 50 million barrels of oil for three days in the United States. You use less than 1% of the fuel consumption 365 days a day, and the demand is there. It is really a drop in the bucket and cannot solve the proportional relationship between fuel supply and shortage. If OPEC or other oil-producing countries If the output cannot be increased. So in my opinion, many, including Goldman Sachs, said that this time he released 50 million barrels of oil (the news), and the slight fluctuation in oil prices called it a price cut. After taking into account the factors, oil prices will continue to rise accordingly, so this measure will not work at all.”
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