Bush Tells Saudi Leaders That High Cost of Oil Hurts American Economy
President Bush on Tuesday urged Saudi Arabia and other members of OPEC to consider the strain the high cost of oil was having on the American economy, addressing an issue that has begun to color the last year of his presidency and dominate the presidential election campaign.
Speaking to a group of Saudi entrepreneurs and later to reporters, Bush expressed concern about the economy in some of his starkest language yet, saying that rising oil costs and gasoline prices were causing hardship for American families. He vowed to raise the issue with the Saudi leader, King Abdullah, during a meeting and dinner at the king’s lush horse farm in the desert outside of Riyadh, the capital.
“My point to His Majesty is going to be, when consumers have less purchasing power because of high prices of gasoline — in other words, when it affects their families, it could cause this economy to slow down,” the president said in an expansive interview summarizing his eight-day trip to the Middle East. “If the economy slows down, there will be less barrels of oil purchased.”
It was unclear whether Bush’s entreaties alone will have any significant effect on the price of oil, since, as the president himself acknowledged, demand continues to rise faster than supplies, especially in expanding markets in China and India, as well as the United States.
Neither Abdullah nor Bush discussed the matter publicly as they met for dinner inside a tentlike hall on Tuesday night, exchanging pleasantries instead about the unusually cold weather. But Saudi Arabia’s oil minister, Ali al-Naimi, appeared to rebuff the president’s appeal earlier in the day.
Saudi Arabia, he said, shared the president’s concern that a downturn in the American economy could have profound effects around the world, including in the oil market. He even raised the prospect of “recession,” a word Bush studiously avoided in the interview, even when pressed about “the R-word.” But Naimi said Saudi Arabia would raise production only “when the market justifies it.”
“Presidents and kings have every right, every privilege, to comment or ask or say whatever they want,” Naimi said in a news conference after Bush’s remarks. “The concern for the U.S. economy is valid, but what affects the U.S. economy is more than the price of oil.”
Bush’s remarks on oil, which came as voters went to the polls in the Michigan primary, underscored a growing worry inside the White House that the economy could sour in his final year in office.
Bush last met Abdullah in Crawford, Texas, in April 2005, before the Saudi leader’s half brother, King Fahd, died and he assumed the Saudi throne. Then, too, concern about rising oil prices prompted the Bush administration to prod Saudi Arabia, OPEC’s largest producer, to raise production to ease prices.