US Said To Be Nudging OPEC+ To Avoid Big Output Cuts: Why It Matters For Biden And Democrats

The United States is nudging the Organization of the Petroleum Exporting Countries and its allies, known as the OPEC+ nations, to avoid significant oil output cuts when President Joe Biden is seeking to prevent U.S. gasoline prices from rising, reported Reuters.

What Happened: Washington is arguing with OPEC+ that economic fundamentals don’t support an output cut, reported Reuters, citing sources.

Oil prices have been falling over the last four months, dragged by fears of a global recession after central banks worldwide tightened their policy rates aggressively to rein in inflation. However, prices soared over 3% on Monday after reports indicated the OPEC+ is likely to consider an output cut of over a million barrels per day in the fresh trading week.

Also Read: The Best Oil ETFs Of 2022

The United States Brent Oil Fund BNO closed 3% higher on Tuesday, while the Vanguard Energy Index Fund ETF VDE closed over 4%.

White House Press Secretary Karine Jean-Pierre said they would not comment on any OPEC action until the Organization acts. “In any event, we will continue to take steps to protect American consumers. Our focus — and it’s been very clear for the past several — several months — has been on taking every step to ensure markets are sufficiently supplied to meet the demand for a growing global economy,” she said.

Why It Matters: An increase in oil prices could potentially impact Democratic prospects during the Nov. 8 midterm congressional elections, the report said. OPEC+ had reduced its output by 100,000 barrels per day in September.

Read Next: Oil Jumps Over 3% As OPEC+ Meet Eyed: Analysts Say This Is The Bare Minimum Supply Cut For Markets To Care

 

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Posted In: NewsSector ETFsCommoditiesPoliticsMarketsMediaETFsGeneralDemocratsJoe BidenMidterm ElectionsOPEC
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