Jason Bordoff
This week’s surprise oil production cut by OPEC and its allies will push up gasoline prices at a time when the U.S. Federal Reserve is already struggling to bring down inflation without triggering a recession or further chaos in the financial markets. The move also underlines the growing political distance between the United States and the oil cartel’s top producer, Saudi Arabia. By putting the prospect of $100-a-barrel oil back in view after it had dropped to around $70, the production cut reinforces the view that Saudi Arabia—with help from Russia and its other OPEC partners—is striving to regain its position as the dominant force shaping oil prices.
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