Tag Archives: oil production cuts

How You Vote Impacts YOU!

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On Tuesday, The Associated Press reported the following:

DUBAI, United Arab Emirates (AP) — Saudi Arabia and Russia agreed Tuesday to extend their voluntary oil production cuts through the end of this year, trimming 1.3 million barrels of crude out of the global market and boosting energy prices.

The dual announcements from Riyadh and Moscow pushed benchmark Brent crude above $90 a barrel in trading Tuesday afternoon, a price unseen in the market since November.

The countries’ moves could increase inflation and the cost for motorists at gasoline pumps. It also puts new pressure on Saudi Arabia’s relationship with the United States, as President Joe Biden last year warned the kingdom there would be unspecified “consequences” for partnering with Russia on cuts as Moscow wages war on Ukraine.

Because of the Biden administration’s energy policies, we are not in a position to make any threats to any oil-producing country! Like it or not, fossil fuel is one of the major foundations of our economy. Fossil fuel powers the trucks that move products, the factories that produce products (those factories the Biden administration tax policies have not driven out of the country), and provides Americans with comfort and mobility. Under President Trump we were energy independent and inflation was under control. Until we go back to the policies that worked for the American people, our standard of living will continue to decline and inflation will continue to rise.

The article concludes:

In recent months, tensions eased slightly as Biden’s administration sought a deal with Riyadh for it to diplomatically recognize Israel.

But those talks include Saudi Arabia pushing for a nuclear cooperation deal that includes America allowing it to enrich uranium in the kingdom — something that worries nonproliferation experts, as spinning centrifuges open the door to a possible weapons program.

Prince Mohammed already has said the kingdom would pursue an atomic bomb if Iran had one, potentially creating a nuclear arms race in the region as Tehran’s program continues to advance closer to weapons-grade levels. Saudi Arabia and Iran reached a détente in recent months, though the region remains tense amid the wider tensions between Iran and the U.S.

Higher oil prices would also help Russian President Vladimir Putin fund his war on Ukraine. Western countries have used a price cap to try to cut into Moscow’s revenues. But those sanctions have seen Moscow be forced to sell its oil at a discount to countries like China and India.

This Is Not Good News For America

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Today, NewsMax posted an article about the most recent meeting of the Organization of the Petroleum Exporting Countries (OPEC).

The article reports:

OPEC and its allies met on Sunday to try to agree further cuts in production, sources told Reuters, as the group faces flagging oil prices and a looming supply glut.

The group, known as OPEC+, delayed the start of formal talks by at least three and a half hours due to members’ discussions on the sidelines of production baselines, from which cuts and quotas are calculated, sources said.

OPEC’s most influential members and biggest Gulf producers led by Saudi Arabia were trying to persuade under-producing African nations such as Nigeria and Angola to have more realistic output targets, sources said.

“Talks with African producers are proving to be difficult,” one OPEC+ source said. Gulf producer, the United Arab Emirates, was meanwhile seeking a higher baseline to reflect its growing production capacity, sources said.

OPEC+, which groups the Organization of the Petroleum Exporting Countries and allies led by Russia, pumps around 40% of the world’s crude, meaning its policy decisions can have a major impact on oil prices.

Four sources familiar with OPEC+ discussions have told Reuters that additional production cuts were being discussed among options for Sunday’s session.

“We are discussing the full package (of changes to the deal),” one of the four sources said.

Three out of four sources said cuts could amount to 1 million bpd on top of existing cuts of 2 million bpd and voluntary cuts of 1.6 million bpd, announced in a surprise move in April and that took effect in May.

The article concludes:

Western nations have accused OPEC of manipulating oil prices and undermining the global economy through high energy costs. The West has also accused OPEC of siding with Russia despite Western sanctions over Moscow’s invasion of Ukraine.

In response, OPEC insiders have said the West’s money-printing over the last decade has driven inflation and forced oil-producing nations to act to maintain the value of their main export.

Asian countries, such as China and India, have bought the greatest share of Russian oil exports and refused to join Western sanctions on Russia.

OPEC has denied media access to its headquarters to reporters from Reuters and other news media.

According to a U.S. News article written in January 2021:

MMT (Modern Monetary Theory) argues that nations with the ability to produce their fiat currency can issue as much money as they need, and as a result, they have no pressures when it comes to financing. In other words, the government cannot run out of money and it essentially has no financial constraints. While the government should have a budget, under this theory, the government doesn’t necessarily have to worry about the deficit because it can fund projects by printing new money from its central bank.

That seems to be the theory that the government is currently operating under. It is a theory that will prove disastrous for America.

This Is Not Good News For The American Economy

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Remember when America was energy independent and gas was less than $2 at the pump? Those days are long gone, and if the Biden administration and OPEC have anything to say about it, we will never see them again.

On Monday, CNSNews reported the following:

Saudi Arabia and half a dozen other members of OPEC+ announced on Sunday that they plan to cut up to a combined 1.15 million barrels of oil a day from May until the end of 2023, calling the decision a “precautionary measure” aimed at ensuring market stability.

The unexpected move comes six months after a decision to cut production by two million barrels a day, also through the end of 2023, sparked a serious diplomatic spat between the Biden administration and the kingdom.

…“We don’t think cuts are advisable at this moment given market uncertainty – and we’ve made that clear,” Reuters quoted a U.S. National Security Council spokesperson as saying in response to Sunday’s announcements.

The announcements by the various oil producers made clear that the new cuts were additional to those announced last October, when OPEC+ agreed on a reduction by two million barrels a day until the end of 2023.

That decision, shortly before the U.S. midterm elections, came despite Washington’s appeals for OPEC+ to increase supply. The administration responded bitterly, portraying the move as one that would hurt U.S. interests and benefit Russia’s war in Ukraine.

President Biden warned of “consequences” and White House and State Department officials said the administration would consult with Congress after the midterms and look to “recalibrate” the 70-plus year relationship with Saudi Arabia.

President Biden needs to realize that no one is listening to him. He has undermined the power of America on the world stage to the point where no one cares what he says. The only real way to avoid the economic crisis that this production cut will create is to resume ALL American drilling immediately. Those involved in the extreme environmental movement need to realize that if they crash the American economy, their movement will lose a lot of support and economic clout. America needs to be energy independent for national security purposes and for geopolitical purposes. If we do not turn the Biden administration’s energy policies around quickly, we are in danger of failing as a nation.