Thread by @ShellenbergerMD

In 2020, Democrats blocked Trump's proposal to buy American oil at $24 a barrel.

Yesterday, a Biden official disclosed a secret offer to buy OPEC+ oil at $80 a barrel in exchange for not cutting production.

Biden's efforts backfired. The US is weakened.

michaelshellenberger.substack.com/p/bidens-secre…

In early September, United States Secretary of Energy, Jennifer Granholm, told Reuters that President Joe Biden was considering extending the release of oil from America’s emergency stockpiles, the Strategic Petroleum Reserve (SPR), through October.

But then, a few hours later, an official with the DOE called Reuters and contradicted Granholm, saying that the White House was not, in fact, considering more SPR releases. Five days later, the WH said it was considering *refilling* the SPR — the opposite of what Granholm said.

The confusion around the Biden administration’s petroleum policy was cleared up yesterday after a senior official revealed that the White House had made a secret offer to buy up to 200 million barrels of OPEC+ oil to replenish the SPR in exchange for OPEC+ not cutting production.

The official said the White House wanted to reassure OPEC+ that the US “won’t leave them hanging dry.” The fact that this offer was made through the WH, not DOE, may explain why DOE called Reuters back. Granholm has been out-of-the-loop on key oil & gas policy decisions.

The revelation poses political risks for Democrats who, in the spring of 2020, killed a proposal by President Donald Trump to replenish the SPR with oil from American producers, not OPEC+ ones, and at a price of $24/BBL not the $80/BBL that Biden promised to OPEC+.

Trump was seeking to stabilize the US oil industry after the pandemic massively reduced demand. Trump proposed spending $3B to fill the SPR. Sen. Dem. Leader Chuck Schumer successfully defeated the proposal, and later bragged that his party had blocked a “bailout for big oil.”

Even White House boosters viewed the Democrats’ opposition to refilling the SPR as a blunder. “That decision,” noted Bloomberg, “effectively cost the US billions in potential profits and meant Biden had millions fewer barrels at his disposal with which to counter price surges.”

Moreover, it will take significantly more oil today to fill the SPR than it would have two years ago. In spring 2020, the SPR contained 634 million barrels out of a capacity of 727 million. Now, the reserve is below 442 million barrels, its lowest level in 38 years.

The decision looks even worse in light of the decision by OPEC+ today to cut production. The Biden admin. in recent days has been pulling out the stops trying to persuade Saudi Arabia and other OPEC+ members, a group that includes Russia, to maintain today’s levels of production.

Last Friday, the Biden administration sought a 45-day delay in a civil court proceeding over whether Saudi Arabia’s Crown Prince should have sovereign immunity for the murder of Washington Post columnist Jamal Khashoggi, for which bin Salman has taken responsibility.

Biden has sacrificed America’s commitment to human rights for his short-term political needs. Instead of pleading with OPEC+ to maintain or increase high levels of oil production, Biden could have allowed for expanded domestic oil production.

Instead, Biden issued fewer leases oil production than any president since World War II.

As such, the pleadings by Biden & his officials have backfired. The perception of the U.S. in the minds of OPEC+ members has weakened while the influence of Putin has strengthened.

Why is that? Why did the Biden administration decide to spend so much political capital trying, and failing, to get Saudi Arabia and other OPEC+ members to expand production when it could have simply expanded oil production domestically? What, exactly, is going on?

To find out the answer, please visit my Substack to read the rest of the article!

michaelshellenberger.substack.com/p/bidens-secre…