President Joe Biden is desperate to ease intensifying inflation pressures in the United States today. He is employing every conceivable measure possible by turning over each rock, spending and printing trillions of dollars, and engaging in good old-fashioned hypocrisy, hoping nobody in the climate change cult notices. After the U.S. finally achieved energy independence under the previous administration, Biden is now relying on foreign oil and the world’s largest crude cartel to keep the automobile tanks full and the lights on back home. But oil-producing markets in the Middle East are exacting revenge on America for feasting on their market share and bringing them to their knees.
OPEC to Biden Again: Sorry, No Deal
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, OPEC+, recently held their monthly ministerial meeting. The 13-member cartel agreed to keep its output plan of 400,000 barrels per day (bpd) intact and eventually phase out the remaining production cuts that were installed in response to the coronavirus pandemic.
OPEC refused to budge on the number, citing concerns about another wave of COVID-19 that would threaten demand. Whether this is a legitimate excuse or not, it is unclear what price and consumption levels would be needed for OPEC nations to increase production significantly. Officials said in a statement following the videoconference:
“The meeting reaffirmed the continued commitment of the Participating Countries in the Declaration of Cooperation (DoC) to ensure a stable and a balanced oil market, the efficient and secure supply to consumers and to provide clarity to the market at times when other parts of the energy complex outside the boundaries of oil markets are experiencing extreme volatility and instability, and to continue to adopt a proactive and transparent approach which has provided stability to oil markets.”
For many of these crude-producing countries, the primary source of economic growth is oil, so these states are likely taking advantage of soaring prices after enduring immense financial suffering during the coronavirus pandemic and going deep into debt. This attitude could force the world to tap into its strategic reserves to ensure West Texas Intermediate (WTI) and Brent contracts do not hit the triple-digit mark ahead of winter.
One thing is for certain: The White House is irked by OPEC’s refusal to play ball with the globe and its rejection of international pressures – again.
Biden Abandons the Green Economy
The Biden administration immediately complained about OPEC’s decision, purporting that the group is “unwilling” to help accelerate the global economic recovery. A spokesperson for the White House’s National Security Council issued a statement following the news:
“Our view is that the global recovery should not be imperiled by a mismatch between supply and demand. OPEC+ seems unwilling to use the capacity and power it has now at this critical moment of global recovery for countries around the world.”
Speaking to CNBC during the COP26 climate summit in Glasgow, Energy Secretary Jennifer Granholm demanded OPEC and its allies loosen the taps to help cool the market. “In some places, we have strong relationships and in some places we wish our allies would move a little faster,” she averred. “The message is we need to increase supply at this moment so that people will not be hurt during the winter months.”
This came days after President Biden chastised the cartel for refraining from raising output to assist in reducing pricing pressures. During the G20 meeting in Rome, he told reporters that OPEC is mostly to blame for skyrocketing energy prices today. “The idea that Russia and Saudi Arabia and other major producers are not going to pump more oil so people can have gasoline to get to and from work, for example, is not right,” Biden said.
WTI futures are at $81 per barrel, Brent is flirting with $83 a barrel, and gasoline stands at $2.30 per gallon. Natural gas prices are having the time of their life, testing $6 per million British thermal units.
Can’t Windmills Save the World?
Biden fired the opening salvos on the oil and gas sector in the first few months of his administration, keeping his election promise of dismantling the fossil fuel industry. From putting the kibosh on the Keystone XL pipeline to suspending oil and gas leasing, the Oval Office initiated a full-frontal assault on energy companies. Rather than issue an apology letter and allow these businesses to drill, baby, drill, Biden is demanding a dozen other countries to pollute the planet, emit greenhouse gas emissions, and supply the rest of the world with oil. Despite promises of a carbon-free future and a goodbye to oil and gas, it turns out that the United States cannot depend on windmills and solar panels in the post-pandemic economy. Biden has performed a complete 180; now he is begging OPEC to pump more crude into global energy markets, and effectively get rich in the process.
Rather than keep America’s energy sector intact, it turns out that Biden wants to make OPEC great again.
~ Read more from Andrew Moran.