On Joe Biden’s first day in office, he began his long fight against the fossil fuel industry in earnest, promptly canceling the Keystone XL Pipeline with a nod to climate fanatics, while also pledging to kill additional pipeline projects. He then went into buck-passing Biden mode as gas prices skyrocketed, falsely blaming oil company “profiteering,” Vladimir Putin, and even the Republican Party for his intentionally-created crisis.
In July, Biden went hat in hand, to beg Saudi Arabia to increase oil production, as my colleague Nick Arama wrote, returning with only his hat. In early August, the Saudis humiliated Biden with a minuscule increase. Now, it looks like OPEC is about to stick it to Biden, bigly — indirectly, at least.
As reported by the Wall Street Journal, the Organization of the Petroleum Exporting Countries and Moscow-led allies, collectively known as OPEC+, are set to consider an oil output cut of more than a million barrels per day (bpd) when it meets on Oct. 5, according to OPEC+ sources.
The figure is substantially above the estimates given last week, which ranged between 500,000 bpd and 1 million bpd. The drastic reduction of production — the largest since the pandemic began — will likely put pressure on global economic growth, according to the group’s delegates.
Here’s more, via the WSJ:
Concerns about a slowing global economy have dragged oil prices down at their fastest pace since the Covid-19 outbreak began in early 2020, prompting OPEC+ to consider ways to prop up the price of oil.
Any move by OPEC+ to raise oil prices could put further pressure on Western consumers already hurting from high energy costs while also helping Russia—one of the biggest energy producers in the world—fill its state coffers as it wages war against Ukraine.
Oil prices had shot up over $100 a barrel and stayed there for months but Brent crude, the global oil benchmark, is now down 23% this quarter, falling to $87.96 a barrel last week, and its swiftest decline since 2020.
Falling oil prices are often a pressure-release valve for the global economy, reducing costs as demand falls in a cycle that repeats itself. OPEC+ often holds itself out as a regulator of the oil market, aiming to keep supply and demand balanced, but a production cut would support prices at a time when they are at historically high levels.
After the intentional Biden Energy Crisis™ led to runaway gas prices and tens of millions of angry Americans, pump prices began to fall (and Biden, of course, pathetically tried to take credit) in part due to China’s Gestapo-like COVID lockdown which led to a slowing economy. But Joe forgot to mention that part.
The pending OPEC+ production cut isn’t the first challenge to the fossil-fuel-hating president. As my colleague Brandon Morse reported in March, ten oil industry associations from all over the country wrote an open letter to Biden that destroyed his buck-passing blame-game accusations that fossil fuel companies were “profiteering” and attempting to price-gouge customers in times of turmoil and economic distress. His “profiteering” charge was thoroughly debunked by Federal Reserve economists in May.
To date, Biden’s only significant attempt to curb run-away prices and energy disruptions has been to recklessly drain the nation’s Strategic Petroleum Reserve, which anyone with an ounce of political savvy can clearly see as a desperate attempt to insulate Democrats in the upcoming midterm elections.
U.S. Oil and Gas Association President Tim Stewart slammed Biden’s reckless actions with an analogy:
This is the first time in history, honestly, that the Strategic Petroleum Reserve has been used as a campaign credit card to buy down political risk for the midterms.
Biden’s latest self-induced oil crisis, if it occurs as predicted— won’t be solved by his campaign credit card. Besides, that thing went into overdraft status, months ago.