In early October, the 23 member group of petroleum exporting states known as OPEC+ agreed amongst themselves to cut oil production by 2 million barrels per day. This amounts to about 2% of the prevailing daily oil production. This was in response to the price of crude oil falling to below $83 per barrel due to the slowdown in the global economy. The decision immediately set off alarm bells ringing in Washington, with the US administration calling it a ‘pro-Russia’ move, and members of the US Congress threatening to legislate punitive measures against members of OPEC+. The US imperialists are particularly angered because a country it has for decades considered to be its client state, Saudi Arabia, is a leading member of this group.
US imperialism considers Russia and China to be its main strategic rivals at the present time. After its attempts to politically and militarily encircle Russia with pro-West and NATO states was met with a pushback from Russia in Ukraine from the end of February this year, the US has focused its energies on punishing Russia. It has been trying to rally all its allies and other states behind this goal. In the process it is showing total disregard for the interests of its allies, including those in Europe and West Asia.
One of the key weapons US imperialism has been using against Russia has been to hit its export of oil and gas and thereby severely dent its revenues. It has placed sanctions on Russian oil companies and others dealing with them. Under its pressure, European countries like Germany which had built up a strong economic partnership with Russia for oil and gas, have been particularly hard hit. The rising prices of these vital energy supplies and the effects that this would have on the peoples of those countries, especially with winter coming, has not bothered the US. A complete oil embargo on Russian oil by European Union countries is expected to take effect in December, and measures to agree on a price cap for oil purchases are also likely to take place.
Despite these measures, US imperialism has not been able to cripple the Russian economy as it had hoped. Countries like India and China have actually increased their purchases of Russian oil in this period. Others are finding ways around the sanctions, looking out for their own interests. In this context, the recent OPEC+ decision to cut oil production and thereby keep up the price of oil in the world markets has rattled US imperialism.
OPEC (Organisation of Petroleum Exporting Countries) was initially formed by five petroleum exporting countries (Iran, Iraq, Kuwait, Saudi Arabia and Venezuela) in 1960. Over the years, the number of such countries joining OPEC increased to 14. More recently, the grouping has been renamed as OPEC+ after it was joined by Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia, South Sudan and Sudan. Saudi Arabia and Russia are the largest exporters in this group.
The US has one of the world’s largest reserves of oil and gas. It has become a major oil exporter over the last decade, particularly with the production of shale oil. Its purchases of oil from Saudi Arabia have come down to 5,00,000 barrels a day from 2 million barrels earlier. However, the US is not a member of OPEC+.
Over the decades, the US has used its hold over Saudi Arabia as its main military supplier to manipulate OPEC’s decisions about the quantum of oil production, to suit its own economic and strategic interests. However, in recent years Saudi Arabia has pursued a more independent line in these matters, even while it still maintains a close political and military relationship with the US. As a result, the tensions between the Saudi and US governments have increased.
Among the measures that the US government is contemplating taking against the OPEC+ states are: enacting legislation called NOPEC (No Oil Producing and Exporting Cartels) which would allow it to sue OPEC for anti-trust violations; bringing the matter before the World Trade Organisation (WTO); and seizing assets of OPEC+ members in the United States.
The drive of US imperialism for global domination is creating an extremely dangerous situation for the worlds peoples. The OPEC+ decision reveals that more and more countries and peoples are refusing to accept US dictate.