U.S.-Saudi Oil Accord One Idea Discussed, Energy Secretary Says

(Bloomberg) -- U.S. Energy Secretary Dan Brouillette said the possibility of a joint U.S.-Saudi oil alliance is one idea under consideration to stabilize prices after the worst crash in a generation.

“There are many, many ideas that are floated around the policy space, that is one of them,” he said in an interview with Bloomberg Television on Monday. “I don’t know that it is going to be presented in any formal way.”

Brouillette was referring to a report last week that some U.S. energy officials are in favor of setting up an alliance with Saudi Arabia. The discussion comes after the price of crude in New York has plunged by around 65% since early January, driven by the combination of an ongoing price war between the Saudis and Russia and the spreading coronavirus pandemic.

“As part of the public policy process, if you will, our interagency partners often get together and talk about a number of different items, but we’ve made no decision on this,” he said. “At some point we will engage in a diplomatic effort down the road. But no decisions have made on anything of that nature.”

Last week, Brouillette announced plans to initially buy 30 million barrels of crude to help struggling drillers, as part of a total program of purchases reaching as much as 77 million barrels. The Energy Department is seeking $3 billion from Congress to cover the cost.

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