You may have wondered like many others: which leads the other… Politics or the economy? Given the rapid developments and available data, the majority are leaning towards believing that the economy is the leader.
When I review many files, I too lean towards the same conclusion, however, what I witnessed recently, namely the change in what can be described as international values, made me reconsider my old convictions.
One thing is for sure, neither the economy nor politics have permanent leadership, as this changes according to the temporary interest of each country or situation.
Furthermore, the accompanying circumstances can change the situation drastically and determine the leader.
All of this is to simply say that some countries’ attitudes in dealing with oil, more specifically their attitudes towards “OPEC” and the “OPEC+”, stem primarily from their political positions towards the oil-producing countries.
Therefore, you can often find the media exaggerating the narrative of the rising oil prices (regulated markets), while deliberately ignoring inflation in the gas markets and the rest of the (unregulated) energy markets.
For example, the White House overreacted to the recent decision by OPEC+ to reduce oil production by 2 million barrels per day, framing the decision as an attempt to influence the course of the midterm elections by raising the cost of fuel on the American voter and angering the democrats.
Some jumped to strange conclusions, suggesting that “OPEC” chose to ally with Moscow in its war on the West.
Furthermore, US President Biden’s administration seems to want “OPEC+” to punish Russia, by reducing its oil revenues and depriving Moscow of revenues used to finance the war on Ukraine, which means that it is asking countries such as Saudi Arabia, the UAE, and others, to pay the bill for punishing Putin’s regime, without considering the interests of these countries and their security concerns regarding some urgent issues in the region.
Even though it had political repercussions, the decision made by OPEC+ is a technical one, however, what Washington is asking for is a purely political oil decision that aims to militarize energy to counter Putin’s move to do the same by stopping gas exports to Europe.
It is a mistake to think that what’s happening in oil prices is driven by political calculations because the last thing OPEC+ is thinking about is using oil as a weapon to balance the scene or hurt one party.
“Oil is not a weapon, nor a fighter plane, nor a tank that can be used to shoot enemies, and more importantly, the relationship between the Arab Gulf states and the United States is a deep historical bilateral relationship, spanning decades, in the fields of politics, defense, economy, investment, and energy, so It cannot be summed up in oil prices, and it is certainly beyond partisan interests and temporary electoral races,” said Adel al-Jubeir, Saudi Minister of State for Foreign Affairs on Fox News.