Thanks to OPEC production cuts, global oil prices rose to $87 a barrel this week.
That means gasoline prices nationwide will soon rise well above $4 a gallon.
These price increases are like a multi-billion dollar tax on American families and drivers, with the money going directly into the coffers of OPEC countries and Russia.
The Saudis and Vladimir Putin couldn’t have planned it better.
But there’s another villain here: President Joe Biden’s “Put America Last” war on our domestic fossil fuels.
Our best estimate, based on data from the Department of Energy forecasts, is that if we had stuck with Trump policies (and not the anti-oil and gas restrictions imposed by Biden’s climate change policies and related ESG initiatives) , to date the USA has produced around 1.2 to 3.5 billion barrels more since Biden took office.
This additional production could have completely neutralized the impact of OPEC’s production cuts and price increases.
The accompanying chart shows oil production forecasts through the end of 2023 before the pandemic and before Biden compared to actual drilling that occurred under Biden.
The value of oil production lost to this war on American energy and reduced drilling so far is between $104 billion and $396 billion.
This is also a National security a self-inflicted wound given the geopolitical importance of oil and gas production.
Even more bitterly ironic, this price increase comes even though Biden just canceled drilling on millions of acres of world-class oil and gas reserves in Alaska.
It has already drained 11 million hectares of rich oil resources from the Gulf of Mexico and crippled oil and gas pipelines.
He is pushing for new emissions standards to effectively ban the sale of new gasoline cars And proposes new taxes on the oil and gas industry — even as it sends over $300 billion in taxpayer money to the green energy movement.
The White House and the media are claiming that more energy is now being produced under Biden than ever before, as if he were suddenly big oil’s best friend.
Yes: As oil prices continue to rise, US drilling has increased.
But the current 12.7 million barrels per day is still below the 13 million barrels per day in 2019, when the price was about $60 per barrel, not $87 per barrel.
One day Biden is boasting that America is producing more oil than ever before, and the next day he is assuring his green allies that he has put the country on a path to “net zero” emissions – which means a complete stop to all oil – and gas drilling means.
Sorry, Mr. President.
Neither can be true.
The reality of the Biden energy strategy: Americans are paying near-record prices for gas and home heating; the oil companies and Saudi Arabia are becoming richer than ever; Global demand for fossil fuels is still near its peak. Domestic production is far below what it could and should be – and America’s status as an energy superpower is in grave danger.
Otherwise, Biden’s drilling and green energy policies are a huge success.
Stephen Moore is a Senior Fellow at the Heritage Foundation; Casey Mulligan is a professor at the University of Chicago. Moore is co-founder of the Committee to Unleash Prosperity, of which Mulligan is a senior fellow.