OPEC+ rejects Biden call to ramp up oil production

FRANKFURT, Germany — OPEC and allied oil-producing countries rebuffed pressure from President Joe Biden to pump significantly more oil and lower gasoline prices for U.S. drivers, deciding Thursday to stick with their plan for cautious monthly increases even as prices surge and the global economy is thirsty for fuel.

The OPEC+ alliance, made up of OPEC members led by Saudi Arabia and nonmembers led by Russia, approved an increase in production of 400,000 barrels per day for the month of December at an online meeting.

That is in line with the group’s road map to add that amount of oil to the market every month into next year. The plan is to open the petroleum taps bit by bit — even as oil prices have surged to seven-year highs — until deep production cuts made during the coronavirus pandemic are restored.

That hasn’t gone down well with Biden, who has made repeated calls to pump more oil. The U.S. used the Group of 20 summit last weekend in Rome to consult with other oil-consuming countries on how to exert influence over the producing countries and what they might do if the Saudis and Russians continue to hold back.

“Our view is that the global recovery should not be imperiled by a mismatch between supply and demand,” a White House National Security Council statement said Thursday. “OPEC+ seems unwilling to use the capacity and power it has now at this critical moment of global recovery for countries around the world.”

The caution from OPEC+ means higher prices worldwide and more revenue for producing countries.

Slower increases also mean less risk of increasing production too fast and sending prices suddenly lower as the group braces for the possibility of more economic turbulence from COVID-19 outbreaks this winter or from supply chain backups, labor shortages and rising consumer prices that have threatened the global recovery.

The average U.S. price of gas rose to $3.40 a gallon, but the 2-cent rise over the past week is the smallest weekly increase in a month.

AAA predicted that elevated crude prices will likely keep pushing up gas prices as long as oil prices are above $80 per barrel.