OIL PRICE - NEW HAVEN. U.S. Treasury Secretary Janet Yellen on Monday said a surprise OPEC+ oil production cut is an "unconstructive act" that will add uncertainty to the global growth outlook and to burdens on consumers at a time of high inflation.
"I think it's a regrettable action that OPEC decided to take. I'm not sure yet just what the price impact will be. I think we need to wait a little longer for, you know, to really assess that," Yellen told reporters after an event at Yale University.
Yellen said a reduction in gasoline prices from last year's peaks had helped limit inflation and it would be detrimental if the trend were reversed.
Oil benchmark prices jumped 6% on Monday, the day after the OPEC+ group jolted markets with plans to cut more production, raising fears of tightening supplies.
"Clearly, it's not a positive for global growth," Yellen said. "And it adds to uncertainty and burdens at a time when inflation is already high" and holding prices down is a top priority.
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Asked about the impact of the $60 per barrel price cap on Russian crude oil imports that Western allies imposed, she said she did not view the OPEC+ production cut plan as a significant factor to "have any impact on the appropriate level of the cap.
"I see it as working," she said of the price cap, adding that it has led to steep discounts on Russian oil and increased bargaining power for purchasers.
She said coalition countries could revisit the price cap level if a change was deemed appropriate, "but I don't see that that's appropriate at this time."
"I want to withhold judgment now on just what impact this will have on oil prices, although I know there's been some reaction today," she said of the OPEC+ move.
