US Treasury secretary Janet Yellen said the move by Opec+ to cut oil production was “unhelpful and unwise” for the global economy, particularly emerging markets already struggling with high energy prices.
The Biden administration has been loudly critical of the decision by the oil cartel backed by Saudi Arabia and Russia this week, which took the step in defiance of US pressure to keep global oil prices down.
“I think Opec’s decision is unhelpful and unwise — it’s uncertain what impact it will end up having, but certainly, it’s something that, to me, did not seem appropriate, under the circumstances we face,” said Yellen in a phone interview with the Financial Times. “We’re very worried about developing countries and the problems they face.”
Yellen was speaking ahead of the IMF and World Bank’s annual meetings in Washington next week, which will be dominated by discussions of high inflation and commodity prices, the impact of the sharp tightening of monetary policy by many central banks, and the economic and financial impact of the war in Ukraine.
“I think we’re going to exchange views on whether our countries are addressing these problems, and try to consider whether our collective reaction adds up to something that is sensible, and the best we can do, in that difficult environment,” she said.
The US is hoping to use the meetings to push European countries to deliver economic aid to Ukraine much more rapidly, amid growing frustration in Washington that some of its allies are behind in terms of fulfilling their vows to help Kyiv financially.
“A number of countries have pledged significant economic assistance, but simply haven’t quite gotten around to disperse it. The pace of transferring money to Ukraine is far too slow. There are commitments but the money needs to be deployed,” Yellen said, noting that the US had delivered $8.5bn in grants for Ukraine and another $4-5bn were just approved by Congress.
“We need to see other countries meet the pledges that they’ve made. And it’s critical to get this funding to Ukraine as rapidly as possible,” she added.
Speaking on Tuesday, Valdis Dombrovskis, European Commission executive vice-president, said the EU was seeking to speed up its disbursements of funding to Ukraine and would “work intensively” with member states to unlock the final €3bn of a €9bn package tha •tted to earlier this year.