London — A decision by the OPEC+ oil producer group last week to rein in output has driven up prices and could push the global economy into recession, the International Energy Agency said on Thursday.
“The relentless deterioration of the economy and higher prices sparked by an OPEC+ plan to cut supply are slowing world oil demand,” the Paris-based agency, which includes the United States and other top consumer countries, said.
The warning from the agency highlights a rift with Saudi Arabia, the world’s top oil exporter and OPEC’s de facto leader.
U.S. President Joe Biden vowed unspecified “consequences” for relations with Saudi Arabia after the OPEC+ move, but Riyadh rejected criticism and said the move was not political and aimed at balancing the market and curbing volatility.
Actual supply losses will likely be around 1 million barrels per day and not the 2 million barrels announced by the OPEC+ bloc, which unites the producer club and allies like Russia, the IEA said.
The EU this month endorsed a plan by the G7 club of wealthy nations to impose a cap on prices for Russian oil exports, a complex set of new global sanctions aimed at depriving Moscow of revenue for its invasion of Ukraine.
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