The U.S. and Saudi Arabia have reached a detente after weeks of hostility about high oil prices, with the OPEC+ cartel announcing a production hike even as the new COVID-19 variant threatens demand.
The group, led by Saudi Arabia and Russia, has surprised markets by agreeing to add 400,000 barrels a day of oil from January, even as the virus undermines prices for oil-producing nations. It left the door open to changing its mind, however, saying ministers could gather again at any moment to review the decision if conditions change.
After weeks of diplomatic tension between Saudi Arabia and the U.S. — with President Joe Biden calling for more oil to ease pump prices and OPEC pushing back — a truce has emerged. U.S. officials have been in the Gulf this week, and the result of their talks has been a game-changer that goes beyond oil policy, according to a person familiar with the meetings. Neither side said what concessions each had extracted.