This is an amazing story, and almost no one is talking about it. Fundamentally, between 2022 and 2024, President Biden took away OPEC's power to dictate global oil prices, and gave that power to the United States instead.
I'm having difficulty finding much mention of it in the U.S. media (there is a paywalled article in The Economist), other than this video segment from All in with Chris Hayes.
Basically, when oil prices were at record highs in 2022, Biden let the world know that the United States would do what it takes to drive prices down, including flooding the market with oil from our strategic petroleum reserve (SPR), a cache of millions of barrels of oil the U.S. government keeps on hand for emergencies.
He then proceeded to sell off 180 million barrels of crude oil at $95 a barrel. This had three significant effects, all of which benefited the U.S.:
- It brought in $17 billion in revenue to the U.S.
- It drove down global oil prices by flooding the market with oil.
- It put world markets on notice that the U.S. had the resources and resolve to push prices down, causing a further drop in oil prices.
And that's not all!
Two years later, when oil prices are lower and OPEC nations are increasing production, Biden is putting oil back into the SPR at lower prices. In other words, he sold high, and now he's buying low.
And that's not all!
Since the U.S. has the capital to prop up oil markets, and keep global prices from bottoming out, this has helped domestic oil producers as well.
The net result of which is that OPEC is no longer calling the shots when it comes to world oil prices. The United States is, and it's all thanks to Joe Biden.
