The oil cartel OPEC’s decision to cut oil supply will harm the global economy and especially developing countries, says US Treasury Secretary Janet Yellen told Financial Times in an interview published on Sunday.
“I think OPEC’s decision is inappropriate and unwise — it’s uncertain what effect it will end up having, but it’s certainly something that didn’t seem appropriate to me under the circumstances we’re facing,” Yellen said, adding that “we” are very concerned about developing countries and the problems they face.”
The cartel of 13 oil-producing countries on Wednesday agreed to cut production by 2 million barrels per day from November in the context of an already tight market and rising world inflation, caused in part by high energy prices.
OPEC’s move marks a victory for Russia against the EU and the US – Russia is a major oil producer and an OPEC+ country that cooperates with the cartel. Ever since Moscow’s invasion of Ukraine, the West has imposed economic sanctions on Russia, including on its oil sector, and urged other countries around the world to follow suit. Despite this effort, Moscow continues to sell its oil to countries such as IndiaChina and Turkey.
OPEC made the decision despite a flurry of trips by EU and US leaders to Saudi Arabia in recent weeks to try to convince the country’s crown prince and new prime minister Mohammed bin Salman to increase oil production to fight inflation.
World oil prices already started to rise after the announcement on Wednesday. moving from about $86 to over $93 per barrel.
Meanwhile, Moscow congratulated “the truly balanced, thoughtful and planned work” of the OPEC countries, which served to “oppose the actions of the United States,” Kremlin spokesman Dmitry Peskov said in a television interview that aired Sunday.