At today’s October Meeting, the Organization of the Petroleum Exporting Countries (OPEC) announced it will slash collective production by 2 million barrels of oil per day. The news confirms reporting from earlier this week that such an “historic” cut would take place, and could push oil prices back towards $100 per barrel according to some analysts. OPEC’s decision to restrict supply threatens to exacerbate the ongoing global energy crisis and drive inflation higher.
Energy markets reacted swiftly following the announcement from OPEC. As of Wednesday morning, oil prices are now $10 more expensive per barrel than just last week. As CNN notes, this move would “be the largest cut since the beginning of the pandemic and could lead to a dramatic spike in oil prices.”
Below is a statement that can be attributed to me, Craig Stevens, spokesman for the GAIN Coalition:
“Instead of working to make America energy independent, President Biden has undermined energy development and infrastructure at every turn and drained our Strategic Petroleum Reserve. As a consequence, our domestic oil output has not yet rebounded to the level it was prior to the pandemic and the SPR is half empty. Now, with OPEC tightening their production levels, these vulnerabilities are being exposed in real time and will drive prices higher and exacerbate the ongoing energy crisis.
North America and our allies have ample natural energy resources to act as a hedge against global supply disruptions, however, bad energy policy decisions in Washington hamstring that ability. Washington should take off the regulatory handcuffs and deliver certainty in federal oil and gas lease sales, pipeline approvals, and permitting. By utilizing the energy resources we have throughout North and Central America, we can meet our growing energy demands and provide additional energy supply to the global markets, limiting pricing shocks around the world.”