Saudis and UAE reject calls to break up Russia’s oil alliance

Two influential OPEC members, Saudi Arabia and the United Arab Emirates, have dismissed calls to cut Russia out of a larger oil-producing alliance with nearly two dozen countries, saying the group has a long history of working together in armed conflicts.

A partnership called OPEC+ between the Saudi Arabia-led Organization of Petroleum Exporting Countries and Russia has refused to pump more oil while oil prices have surged above $100 a barrel. Production of more crude oil could lower prices, some analysts say.

Saudi Energy Minister Prince Abdulaziz bin Salman described OPEC’s decision to stay with Russia as a way for the group to resolve disagreements among members. The Saudis and Emiratis have condemned Russia’s invasion of Ukraine in votes at the United Nations General Assembly.

“When it comes to OPEC+, everyone leaves politics at the door,” Prince Abdulaziz said at a conference in Dubai on Tuesday. “We have managed to separate our political differences from what we all consider to be the common good.”

His Emirates counterpart, Suhail bin Mohammed al-Mazrouei, said kicking Russia out of the alliance would lead to a spike in oil prices.

“Consumers are asking us to calm down prices. How can we squeeze out some of the partners?” he said.

Her comments come before OPEC, Russia and other producers meet on Thursday, when they are expected to approve a further increase in production of 400,000 barrels a day, part of a plan agreed in July 2021 to slowly increase production in monthly increments. Oil investors have generally not viewed the group’s production increases as enough to tame rising prices.

Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman.


Photo:

Ebrahim Noroozi/Associated Press

In its 62-year history, OPEC has generally not fired members, even when they have been involved in violent conflicts with each other.

Two OPEC members, Iran and Iraq, were at war for most of the 1980s. A delegation from the Kuwaiti government-in-exile attended an OPEC meeting after Iraq, a member country, invaded in 1990.

Prince Abdulaziz said OPEC is now in the same situation. He said another OPEC member funded and trained Yemeni rebels behind a series of attacks on Saudi oil facilities last week. The attacks were alleged by the Houthis, a group the US and Saudis said was armed by Iran, which denies the charge.

Russia’s attack on Ukraine helped push oil prices above $100 a barrel for the first time since 2014. For example, rising oil prices could further fuel inflation across the US economy. Photo illustration: Todd Johnson

write to Benoit Faucon at benoit.faucon@wsj.com and Summer Said at summer.said@wsj.com

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