HOUSTON – (Oct. 19, 2022) – Relations between the United States and Saudi Arabia could affect prices at the gas pump as well as perceptions of the American government, according to experts from Rice University's Baker Institute for Public Policy.
The Saudi government has demonstrated increasing support for Russia’s interests while distancing itself from U.S. influence, say Kristian Coates Ulrichsen, Mark Finley and Jim Krane.
“In particular, the kingdom has grown less willing to consent to U.S. presidential requests to increase oil production or follow the U.S. lead in isolating Russia over its invasion of Ukraine,” they wrote in a new report. “The OPEC+ group’s Oct. 5 decision to aggressively cut production despite vehement U.S. opposition is emblematic of this changed dynamic.”
As a result, the Biden administration is left with few options to deal with rising oil prices, according to the report. Choosing when to activate spare oil production capacity — and when to refuse — gives the Saudi regime influence over the domestic popularity of the president, the authors argue.
“As long as oil prices remain a major risk factor in U.S. politics, future U.S. administrations would be advised to tread carefully with the kingdom,” the co-authors wrote. “Likewise for Saudi Arabia, caution is warranted. Public displays of discontent with Washington are a matter that Washington can probably get used to. But when Saudi actions deliberately inflate U.S. gasoline prices at election time, such actions are perceived as hostile political interference and can undermine and damage bilateral relations.”