Biden vows 'consequences' for Saudi Arabia after oil production cut

WASHINGTON — President Joe Biden vowed Tuesday to impose "consequences" on Saudi Arabia for teaming up with Russia to cut oil production, signaling a rupture in the relationship between two longtime allies and a reversal of his own effort to cultivate the energy-rich kingdom.

Amid deep anger over last week's decision by the Saudi-led OPEC+, Biden's staff announced that he would reevaluate the entire relationship with Saudi Arabia and expressed openness to retaliatory measures offered by congressional Democrats such as curbing arms sales or permitting legal action against the cartel.

"There's going to be some consequences for what they've done with Russia," Biden told CNN's Jake Tapper in an interview broadcast Tuesday night. The president would not specify his options or his timetable, leaving the details intentionally vague. "I'm not going to get into what I'd consider and what I have in mind. But there will be consequences."

The presidential pushback underscored the domestic and international ramifications of the move to scale back petroleum supplies on the market by up to 2 million barrels per day to bolster the price of oil. Coming just weeks before critical midterm elections that could turn on the cost of gasoline at the pump, the production cut was viewed as a betrayal by the White House, which believed it had an understanding with Saudi leaders when Biden visited over the summer to keep the oil flowing.

It also undercut Biden's efforts to isolate President Vladimir Putin's Russia for his invasion of Ukraine, providing considerable relief for Moscow, which is dependent on oil exports. Rather than stick with its traditional ally in Washington, Saudi Arabia effectively sided with Russia even as China and India have been distancing themselves from the Kremlin.

The decision came after what U.S. and foreign officials Tuesday described as an intense last-minute lobbying effort by the Biden administration and other OPEC members that were reluctant to pump less oil. Saudi officials insisted on paring back production by arguing that the price could fall dangerously low.

Biden advisers implored Saudi officials to wait another month until OPEC+ members were expected to meet again Nov. 3 to see if markets actually did slide the way Riyadh feared. Sheikh Mohammed bin Zayed Al Nahyan, the president of the United Arab Emirates, sent his national security adviser to Riyadh to urge caution.

But Crown Prince Mohammed bin Salman of Saudi Arabia, who has embarked on ambitious and costly projects such as building a futuristic $500 billion high-tech metropolis in the desert, rebuffed the pleas, arguing that falling oil prices would jeopardize his energy-dependent budget.

Maintaining that the decision was not meant as a slap at Biden or the United States, Saudi officials have privately assured U.S. officials that they are prepared to increase production significantly in December when the European Union is set to curb Russian crude exports. To mollify U.S. leaders, the Saudis may also vote against Russia's annexation of Ukrainian provinces at the United Nations this week.

With the latest barrage of Russian missiles across Ukraine, however, the outrage in Washington directed at Riyadh has only grown in recent days. Biden's decision to review the relationship came a day after Sen. Bob Menendez, D-N.J., the chair of the Foreign Relations Committee, called for an immediate freeze on "all aspects of our cooperation with Saudi Arabia," vowing to use his power to block future arms sales.

Sen. Dick Durbin of Illinois, the second-ranking Democrat in the Senate, said Tuesday that Saudi Arabia clearly wanted Russia to win the war in Ukraine. "Let's be very candid about this," he said on CNN. "It's Putin and Saudi Arabia against the United States."

Two other Democrats, Sen. Richard Blumenthal of Connecticut and Rep. Ro Khanna of California, announced Tuesday that they would introduce legislation cutting arms sales to Saudi Arabia.

Blumenthal said Biden should take action. "I would do more than reevaluate. I would act immediately," he said in an interview. "He has been misled and double-crossed, and I don't think he should or will take lightly to it."

John Kirby, the strategic communications coordinator for the National Security Council, said the president was willing to discuss next steps with members of Congress. "Certainly in light of recent developments and OPEC+'s decision about oil production, the president believes that we should review the bilateral relationship with Saudi Arabia and to take a look to see if that relationship is where it needs to be and that it is serving our national security interests," he told reporters.

In an initial gesture of discontent, the Biden administration informed the Saudis that it would not participate in a scheduled meeting of a regional working group dedicated to defending against potential Iran airstrikes, according to a U.S. official, although the session will be rescheduled. The postponement was previously reported by Semafor, a new news outlet.

Still, it was not clear how far Biden was willing to go, or whether he was using the public comments as a warning to Saudi Arabia or as an effort to quiet domestic critics who have faulted him for being soft on the kingdom. No special team of aides was established to conduct a formal review; no deadline was set for a conclusion; and no options were mentioned for consideration.

The White House has done nothing yet to consult Democratic leaders on Capitol Hill. Congressional officials, who spoke on condition of anonymity to describe internal deliberations, said Sen. Chuck Schumer, D-N.Y., the majority leader, was "seriously considering" bringing up legislation to punish the Saudis by allowing lawsuits for price fixing. But they said congressional Democrats were seeking more guidance from the White House on its preferences.

The legislation, named NOPEC, for the No Oil Producing and Exporting Cartels Act, has been kicking around on Capitol Hill with bipartisan support but never reached serious consideration absent a push from the White House and because of fears of retaliation.

But Congress has taken on the Saudis in the past in a similar vein. In 2016, Congress for the first time overrode the veto of President Barack Obama and passed legislation allowing families of victims of the Sept. 11, 2001, attacks to sue Saudi Arabia. Fifteen of the 19 hijackers were Saudi nationals.

Saudi officials on Tuesday defended the production cut and insisted their alliance with the United States remained strong. "Our relationship with the United States has been institutional since it was established," Prince Faisal bin Farhan Al Saud, the foreign minister, told Al-Arabiya television. "The OPEC+ decision was purely economic and was taken unanimously by the member states."

Some foreign policy veterans cautioned Biden against drastic action penalizing Saudi Arabia, long a valued ally to the United States in fighting terrorism and countering Iran in the region.

"The United States should seek a new strategic compact with Saudi Arabia rather than a divorce," said Martin S. Indyk, a former diplomat in the Middle East who is now at the Council on Foreign Relations. "We need a more responsible Saudi leadership when it comes to oil production and regional behavior. They need a more reliable U.S. security understanding to deal with the threats they face. We should both step back from the brink."

The president endured withering criticism for visiting Saudi Arabia in July and giving a fist bump to Crown Prince Mohammed, despite a campaign promise to make the kingdom an international "pariah" for the killing of Saudi journalist Jamal Khashoggi. The CIA has determined that Crown Prince Mohammed ordered the operation that led to the 2018 murder and dismemberment of Khashoggi, who was a columnist for The Washington Post and a resident of the United States.

Overcoming his own reservations, Biden went along with advisers who had argued that it was worth the political hit to restore ties with Saudi Arabia for a variety of reasons, including the need to bolster energy markets given the Ukraine war. While no specific announcements were made during Biden's visit to Jiddah, Saudi Arabia, in July, U.S. officials said at the time that they had an understanding with Saudi Arabia that it would increase oil production in the fall and lower gasoline prices heading into the crucial congressional elections.

After falling for more than three months, gas prices are rising again, increasing by 12 cents a gallon on average over the past week to $3.92, according to AAA, although they remain far below the June peak of just over $5.

Saudi officials and commentators have bristled at the idea that Washington should expect to dictate Saudi oil policy and insisted that the kingdom's action was aimed at keeping markets in balance.

The Saudis accuse the United States of neglecting its historical commitment to the kingdom's security and being overly accommodating to Iran, the Saudis' regional nemesis, tracing the grievances back to Obama's administration when Biden was vice president.

They cited Biden's decision last year to remove some Patriot missile batteries from the kingdom while it was being subjected to frequent missile attacks from Houthi rebels in Yemen backed by Iran. The United States transferred some Patriot interceptor missiles to Saudi Arabia this year to fend off attacks."

Iranian missiles are hitting Saudi oil facilities, but at the same time they are coming to Saudi Arabia to ask for help with oil markets," said Mohammed Alyahya, a fellow at the Belfer Center at Harvard and a senior fellow at the Hudson Institute. "The Saudis have stated that while their facilities are being attacked, security was their priority. The U.S. has been used to having its cake and eating it too."

Ben Hubbard contributed reporting from Istanbul, and Carl Hulse from Washington.

This article originally appeared in The New York Times.