President Bush used a private visit to Saudi King Abdullah's ranch in Riyadh on Friday to appeal for an increase in oil production that might give U.S. consumers some relief at the gasoline pump. The Saudis responded by announcing they had decided a week ago on a modest increase next month of 300,000 barrels a day to meet increased demand.
WHAT DOES IT MEAN?
Bush's request, his second in five months, coupled with rising anti-Saudi sentiment in the Democratic-led Congress, underscored the growing tensions between the two countries over oil.
Bush's visit here was, in many respects, a reprise of a trip he made to the king's ranch in January, when he asked for an increase in production and was rebuffed publicly by the oil minister and privately by the king. This time, the Saudis again resisted Bush while also offering at least the appearance of a concession.
WILL IT CHANGE PRICES?
It's unlikely, the White House said, that the change would lower gasoline prices, which are nearing $4 a gallon. Bernard Picchi, an energy analyst at Wall Street Access, said Saudi Arabia would have to boost production by 1 million or 1.5 million barrels a day to make a difference.
WHY THE INCREASE?
Oil Minister Ali al-Naimi said the kingdom had decided May 10 to increase production, not in response to Bush but because customers, mostly in the United States, had asked for it. He said it was doing what it could. "When supplies from Venezuela and Mexico were reduced to the U.S., who supplied the difference?" Naimi said. "We supplied, to the tune of an additional 300,000 barrels per day ... for our customers in the U.S. So how much more can we do?"
WHY IS KINGDOM KEY?
Saudi Arabia is the industry's only swing producer, keeping a significant reserve that allows it to raise output rapidly to make up for sudden global shortfalls.
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