Posted on 04/30/2020 4:33:17 AM PDT by Oldeconomybuyer
WASHINGTON/LONDON/DUBAI - As the United States pressed Saudi Arabia to end its oil price war with Russia, President Donald Trump gave Saudi leaders an ultimatum.
In an April 2 phone call, Trump told Saudi Crown Prince Mohammed bin Salman that unless the Organization of the Petroleum Exporting Countries (OPEC) started cutting oil production, he would be powerless to stop lawmakers from passing legislation to withdraw U.S. troops from the kingdom, four sources familiar with the matter told Reuters.
The threat to upend a 75-year strategic alliance, which has not been previously reported, was central to the U.S. pressure campaign that led to a landmark global deal to slash oil supply as demand collapsed in the coronavirus pandemic - scoring a diplomatic victory for the White House.
Trump delivered the message to the crown prince 10 days before the announcement of production cuts. The kingdom’s de facto leader was so taken aback by the threat that he ordered his aides out of the room so he could continue the discussion in private, according to a U.S. source who was briefed on the discussion by senior administration officials.
The effort illustrated Trump’s strong desire to protect the U.S. oil industry from a historic price meltdown as governments shut down economies worldwide to fight the virus. It also reflected a telling reversal of Trump’s longstanding criticism of the oil cartel, which he has blasted for raising energy costs for Americans with supply cuts that usually lead to higher gasoline prices. Now, Trump was asking OPEC to slash output.
(Excerpt) Read more at reuters.com ...
That's a bizarre rationale. Tariffs are some kind of violation of "free market" principles ... but production cuts under threat are not? WTF? LOL.
“They buy high and sell low.”
Not with this guy in charge.
L
Optics....
Of course they are both violations of free (cheat) market (lack of) principles, but it is much harder to scream about the threat vs tariffs. Free markets are great in principle but the playing field is being tilted by the 800lb gorillas on the field. Fair market theory allows for putting your thumb on the field to level it. Trump merely put his thumb on the field and leveled it.
BTW, to see more field leveling see Amazon, the Postal Service rates and small retailers. Again, thumb, field and threats.
Hard. Ball.
TARIFF OIL IMPORTS NOW MR. PRESIDENT!!!
Hear hear!!!!
You are on fire today!!!
No. This has nothing to do with Flynn.
This is about the Saudis trying to take advantage of the economic slowdown due to the Wuhan Virus and kill off many smaller oil suppliers that could go completely under at today’s global oil price. In the process, it is damaging to the U.S. domestic oil business at a time when too many other U.S. businesses are suffering due to enforced lock downs.
Trump’s action is not about any media conspiracies. It is about the U.S. national interest.
The Saudis have to understand our alliance must be mutual, not one way. They deny our interests at their own peril.
While there is still time.
The Saudi royal bloodline should have been exterminated after 9/11.
“It just goes to show you how morally bankrupt and unprincipled we have become as a nation. We used to hate OPEC because they limited production to drive up energy prices. Now we want them to limit production to drive up energy prices. “
You are so silly sometimes.
There is nothing morally bankrupt in recognizing the even though the price directions back then and now are not the same, both have the Saudis trying to artificially create oil market conditions for purposes that have nothing to do with natural oil supply vs demand conditions.
When OPEC sought to drive up global oil prices it was political, to try to hurt western economies due to different perspectives, western vs Arab, over western Middle East policies, particularly regarding the Arabs of Palestine. We opposed the Saudi action because with the oil price increases OPEC was trying to extort different geopolitical policies from the west. There was no essential, natural supply demand problem supporting the OPEC price increases. There was nothing morally bankrupt about our opposition to what OPEC did at that time.
At this time, there is, again, no essential, fundamental, natural supply demand problem that calls for greater global oil production. In fact, the natural signals across the globe include depressed demand at this time due to extreme economic downturns resulting from the Wuhan Virus pandemic. The Saudis are again taking actions that have nothing to do with any natural supply demand imbalance. They are artificially creating, again, an imbalance between what the demand signals say the world needs, and what they are choosing to produce, in spite of depressed demand. Like they were before, the prices coming from the Saudis actions are driven by artificial means - intentionally over producing more oil than the world needs right now. Again, the Saudis are trying to artificially manufacture market conditions. There is nothing morally bankrupt about opposing what the Saudis are doing.
Yup.
However, SA waived through “students” there on student visas, so at least some of the terrorists could have come from Iraq or Iran.
Your thoughts are wrong.
Trump should go further.
Cut off all U.S. oil imports from OPEC or Russia (if there is any). That will support our domestic oil business and our non-OPEC oil partners.
“The U.S. became the world’s largest petroleum producer a couple of years ago. Don’t you find it bizarre that the country producing more oil than anyone else is telling other countries they’re producing too much oil? “
Not at all. Nothing bizarre about the oil industry increasing use of available U.S. oil supply at a time when the global oil demand was increasing, as the global economy was growing..
What is bizarre is the holder of the largest oil reserves in the world, increasing oil production at a time when no one in the world who uses oil is seeking greater oil supply. In fact all the natural supply demand signals on oil today scream for lower oil production because there is depressed demand for oil.
What is bizarre here is you thinking the U.S. position is bizarre, because you cannot put anything in context.
Trump and Greta agree on something. Trump wants to revive OPEC to help domestic producers. Greta wants to revive OPEC to limit what she thinks is our morally bad energy use.
Nonsense. The main goal is for them to be responsible market participants. Yo-yoing the supply is not being responsible.
It is possible that Trump threatened something else related to military matters, which an editor cut down to "troops", but this is Reuters which lies constantly about the US in general and Trump in particular, so I wouldn't cut them any slack. This looks too much like more lies by Reuters.
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