Biden administration calls on OPEC to increase oil production

the Biden administration issued a declaration put pressure on OPEC to increase oil production. So it seems that the messages from US officials are a bit mixed at present. There is a conflict here, given Biden’s rhetoric about the climate and over put electric cars on the road.

the declaration says OPEC must do more to support the “global recovery” from the ongoing pandemic. Gas prices going up are a threat to this recovery, but I would hesitate to call anything we do now a recovery in the first place, as that implies that the pandemic is behind us. Either way, gasoline prices are higher today than they have been in recent months, as the Financial Time details:

Gasoline prices in the United States have increased in line with soaring demand for fuel as the US economy has reopened following coronavirus lockdowns. Gasoline sells for an average of $ 3.19 a gallon across the country, up nearly 50% from the same time last year, according to the AAA, an automotive association. The highest national average price recorded was over $ 4.10 per gallon in 2008.

The reason gas prices have increased is that global oil production is down, due to the pandemic. OPEC + has cut production by millions of barrels per day, according to a report by Reuters, due to the drop in oil demand during lockdowns:

OPEC + had implemented a record production cut of 10 million bpd, or about 10% of global demand, as global energy demand plummeted during the pandemic, but has gradually increased production since. . By July, the reduction had been relaxed to about 5.8 million bpd.

Last month, the organization’s member countries met and agreed to start ramping up production. Of Reuters:

In a July meeting, OPEC + agreed to increase production by 400,000 b / d per month from August until the remainder of the 5.8 million b / d reduction. j is gradually phased out. OPEC + is due to hold another meeting on September 1 to review the situation.

But, apparently, the pace set by OPEC + for increasing production is not enough for the Biden administration, who said in their declaration that increasing production takes too long:

While OPEC + recently agreed to production increases, these increases will not fully offset previous production cuts imposed by OPEC + during the pandemic until 2022. At a critical time in the global recovery, this is not the case. just not enough.

Again, this calls into question the administration’s plans to tackle climate change. We cannot successfully move away from fossil fuels if rising gas prices prompt the White House to give the green light to drill more. And I understand.

All of this gives me flashbacks to the recession when gasoline was costing over four dollars a gallon. On the one hand, I fear it will happen again. On the other hand, I understand that we’ve done shit on the environment for too long, and it is troubling that our response to rising gas costs in the so-called developed world is to literally go back to that well.