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U.S. senators press Saudi officials to put oil cut in motion

Published 04/11/2020, 04:18 PM
Updated 04/12/2020, 09:40 AM
© Reuters. An employee rides a bicycle next to oil tanks at Saudi Aramco oil facility in Abqaiq

(This April 11 story has been refiled to replace "boost" with "cut" in paragraph six.)

By Timothy Gardner

WASHINGTON (Reuters) - Republican U.S. senators from oil states who recently introduced legislation to remove American troops from Saudi Arabia said on Saturday they had spoken with three officials from the kingdom and urged them to take concrete action to cut crude output.

Saudi Arabia and Russia were close to finalizing a deal with other producers in the informal OPEC+ group to cut crude output by a record 10 million barrels per day (bpd), or about 10% of global output.

Oil prices had fallen to 18-year lows as the coronavirus outbreak has closed down economies across the world and after Saudi Arabia and Russia boosted output in a race for market share.

The call was led by Senators Dan Sullivan and Kevin Cramer, who introduced legislation in March to remove U.S. troops, Patriot missiles and THAAD defense systems from Saudi Arabia unless it cut output.

There were 11 Republican senators on the nearly two-hour call, including Bill Cassidy, who introduced legislation last week to remove the U.S. troops in 30 days, a month faster than the previous legislation.

While the bills are unlikely to pass, the senators have played an unusual role in raising pressure on longtime ally Saudi Arabia, as President Donald Trump, a fellow Republican, has been in talks with Crown Prince Mohammed bin Salman urging him to cut output.

They spoke with Saudi Energy Minister Prince Abdulaziz bin Salman, Deputy Defense Minister Khalid bin Salman and the Saudi ambassador to the United States, Princess Reema bint Bandar bin Sultan.

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Sullivan, of Alaska, applauded Saudi Arabia's taking part in the agreement to cut output, but said "actions speak louder than words."

"The Kingdom needs to take sustainable, concrete actions to significantly cut oil production, and it needs to do so soon," Sullivan said.

Saudi Arabia's action to boost production during a pandemic was "inexcusable" and "won't be forgotten," said Cramer, of North Dakota.

The United States, the world's top oil producer, is gradually cutting about 2 million bpd of output as reduced demand and low oil prices force some heavily leveraged producers into bankruptcy.

The push by Republican senators was a sign of how Congress could raise pressure on Saudi Arabia if it does not stick to the oil cut plan. If the kingdom does not cut output, pointed measures could be included later this year in must-pass legislation such as the annual defense policy bill.

In January, the United States had 2,500 military personnel in Saudi Arabia. In October 2019, Washington deployed about 3,000 troops there at a time of heightened tensions with Iran.

The Saudi embassy in Washington did not immediately respond to a request for comment.

Latest comments

Antitrust Act only work beside america.
Unless US joins No Deal.
Why would saudi cut oil production and take this hit given that they dont have much of a diverse portfolio and oil is their primary source of income?
Especially now that china is going back to work.
Oil is worth what it's current price is right now
OIL is worth 40$ a barrel no matter what. Dont get left in the dust
how much is the sea water in the sea?
Congress do as I say not as I do.
let the prices bottom where they will. Gas prices are still not as low as they should be. The middle people are holding prices up and we consumers are still suffering under big oil. we always have and there is no reason for it. Political pay offs are a standard from big oil and consumers foot the bill.we have enough oil here and our country wants to play the boss of the playground to keep the U S dollar from loosing it's hold on the oil market. let it fall out to who can survive.
We finally got to live in a world of crooks.
Russian planed very wisely to bankrupt USA oil producer and Crona also help this way.
you love Pukin much?
In each series of crisis we see how the Americans are hypocrites, on the one hand blasting countries for "unfair practices" while on the other hand propping up a zombie market and forcing others to manipulate the prices of commodities for it's unfair benefit
Didnt this happen right before the 1929 Great Depression? Seems like history repeating itself again
Not all Americans just those in power.
I think US troop can attack Saudi oil facility as if they start Vietnam war on purpose. They always do like that.
It cost SA less than the current price. They r making goid profit. if thats not Capitalism, what is! y'all senators say actions speaks louder than words. Y'all call yourselves Capitalist, but your actions say Communist with a side of Dictatorship!
This is funny , lets see ... colapse again
so our troops are in saudi Arabia to protect Saudis from Iran. really?
The World doesn’t need this deal. Let the market decide the price like everything else. Our drilling & small oil companies have already been strangled & made their layoffs. Exxon & the big boys will always survive No need to encourage higher prices to help Russia, Arabia & other kings!
Sounds like a lot of assumptions being made. There are many independent oil companies that are hanging on and if oil could go to $30-$35 many jobs would be saved. So if you do not care about saving US jobs take oil to $5. But then you will be whining about something else.
actually, you personally always welcome to pay even more)) Its like in Big Lebowski: Her life was in your hands!!
First wanted cheap oil, got it, now save dirty oil. Promoted travel as usual, got virus spread to every corner of u.s., now ******all small business with lockdown but money flows first to bail airlines, travel, oil, etc. Missed priorities of health and safety, just trillions to ease rich owners pain let the common people die cutting Medicare and ss expenditures long term goal. Revolt and unrest coming.
Hope black Monday coming soon, so exciting. People all get panic. This is third week, stay at home, no salary. Nice, it’s all fake call last week. Let’s short it again.
And all us taxpayer's get the bill in the end!
not all tax payers. the top will leave the country and live somewhere else because they can. the poor will be on the streets. its the middle class or i dare say the new poor class.
A big healthy 5% corrrection is required
Since trump could care less about this virus if he looses in November he’ll just let the next president clean up the mess no conscience
First trump wanted cheap oil, he got it.
Lol trump got oil buddies that want price to go up yea let’s pay more for gas in a recession sounds good
Threat and bullying is US politian core virtue?
I solidly concur.
That’s called neo imperialism
Thanks there’s no demand for gas nobody’s working genius
We will see how Sunday futures and Monday markets react to us leading in virus infection
Unemployment at record who’s buying gas and they want to have higher prices 🤪
That’s US problems, not saudi’s.
lol. Good one. 15 a barrel not a Saudi problem?
Not at all. Saudi just pull out its investment out of Wall street whenever they need some cash.
Belows 20usd per a barel
Fracking has been shut down because of Covid-19 concerns. Fracking plant in Beaver County, PA has stopped its new plant construction. What will gas prices look like in a few months with fracking being stopped and Saudi production being cut..? A big fricken mess. That is what it's going to look like. A big mess.
Hence, take advantage of the low price and stock. But god forbid, these idots actually try and think ahead.
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