Almost every day this week, a new lawmaker has rallied behind a growing effort to legislate a fundamental rethink of US relations with Saudi Arabia.
On Monday, Senator Bob Menendez (D-NJ), the influential head of the Senate Foreign Relations Committee, released a statement calling on the US to “immediately freeze all aspects of our cooperation with Saudi Arabia.” Later in the week, Sen. Richard Blumenthal (D-CT) and Rep. Ro Khanna released a bill to temporarily halt US arms sales to the Kingdom.
This bill would “send a strong message to the Saudis as our country works to rebalance this one-sided relationship,” lawmakers say.
Sen. Richard Blumenthal (D-CT) and Rep. Ro Khanna (D-CA) held a news conference Wednesday to discuss legislation that would temporarily halt U.S. arms sales to Saudi Arabia. (Chip Somodevilla/Getty Images)
The agitation for action comes after OPEC+ – led by Saudi Arabia – announced cuts in oil production on Oct. 4 while Congress was not in session. Most lawmakers are currently focused at home on the upcoming midterm elections.
As Saxo Bank’s Head of Commodity Strategy Ole Hansen recently said on Yahoo Finance about its US and international positioning, “We see politics playing a bigger role in this oil market right now” as players “still trying to figure out what really happened at the OPEC+ meeting last week.”
While lawmakers are not expected to return to Washington until Nov. 14, White House action could come sooner as President Biden said in a CNN interview this week “there will be consequences” for Saudi Arabia. On Thursday, Biden teased some sort of White House action on gas prices in the coming days, though it’s unclear if next week’s move will directly affect Saudi Arabia.
Jared Bernstein, a member of the White House Council of Economic Advisers, underscored the point in an interview with Yahoo Finance Live on Thursday, saying, “We need to do more, especially given this misguided, and I think very misguided, decision by OPEC+.”
A set of action ideas
Back on Capitol Hill, the list of lawmakers calling for action has grown.
Additional calls have come in recent days from the likes of Senator Chris Murphy (D-CT), Senator Bernie Sanders (I-VT), Rep. Tom Malinowski (D-NJ) and more. Malinowski is leading her own efforts to order the withdrawal of US troops and missile defense systems from Saudi Arabia and the United Arab Emirates.
The story goes on
In the debate circling around Saudi Arabia, prominent Republican co-sponsors are missing (at least so far). In one of his only comments on the issue, Senate Minority Leader Mitch McConnell (R-KY) sent out a press release criticizing Democrats who are raising the issue for “voting on every opportunity to and choke gas production 2 years.”
Oil analyst Frank Macchiarola of the American Petroleum Institute recently underscored this perspective, telling Yahoo Finance that a lesson from the past few weeks is “the importance of producing energy here in the United States and not relying on foreign countries like OPEC+.” having to leave nations for our energy.”
Another idea that has come under renewed consideration in recent weeks is a bipartisan bill that has been floating around in Congress for years under the name “NOPEC” and was introduced in the Senate earlier this year. The bill would remove state immunity and empower the Justice Department to file antitrust lawsuits against Saudi Arabia and other members of OPEC+.
Last week, a prominent Republican supporter of that effort, Sen. Chuck Grassley (R-IA), urged a reconsideration. Capitol Hill leaders hope to consolidate the ideas into a coherent bill that can be passed this winter.
Biden ‘looks forward to engaging Congress on her return’
Meanwhile, the price of crude oil – after spiking on OPEC’s announcement – has fallen in recent days. Some energy analysts say many OPEC nations were producing below quotas ahead of last week’s announcement, so the impact may be less than initially feared.
But in the political sphere, the back and forth is likely to continue. In a recent statement, OPEC said the White House was trying to delay production cuts by a month while a parade of administration officials from the president down slammed the decision.
In one example, Treasury Secretary Janet Yellen warned that OPEC’s oil production cut will have a negative impact on the global economy, telling the Financial Times the decision was “unhelpful and unwise”.
In a call with reporters this week, National Security Advisor Jake Sullivan said “there are a number of interests and values that are implicated in our relationship with this country,” adding that Biden “looks forward to speaking to Congress.” to include their return”.
Ben Vershkul is the Washington correspondent for Yahoo Finance.
Read the latest financial and business news from Yahoo Finance
Follow Yahoo Finance on TwitterFacebook, Instagram, Flipboard, LinkedIn, YouTube and reddit.