OPEC dropping oil output, Biden’s sale of federal leases at record low

IT’S BEEN QUITE THE ROLLER COASTER FOR ENERGY PRICES THIS SUMMER.

AFTER HITTING RECORD HIGHS IN MARCH, OIL PRICES HAVE STEADILY DECLINED GIVING DRIVERS A MUCH-NEEDED REPRIEVE AT THE PUMP.

NOW, BECAUSE OF THOSE FALLING PRICES, OPEC AND ITS ALLIED OIL- PRODUCING COUNTRIES INCLUDING RUSSIA ARE GOING TO TRIM BACK THEIR GLOBAL OUTPUT.

THE OPEC+ COALITION ANNOUNCED THIS WEEK IT WOULD PUMP 100,000 FEWER BARRELS PER DAY.

OPEC+ AND ITS MEMBER NATIONS SET A GOAL OF 43.8 MILLION BARRELS PER DAY FOR OCTOBER, SO THE REDUCTION IN OUTPUT IS REALLY JUST A DROP IN THE BUCKET.  

HOWEVER, INDUSTRY EXPERTS SAY THE ANNOUNCEMENT FROM OPEC+ SHOWS THE ORGANIZATION THINKS PRICES HAVE FALLEN ENOUGH.

MEANWHILE, THE WALLSTREET JOURNAL IS REPORTING FEDERAL OIL LEASES UNDER THE BIDEN ADMINISTRATION ARE DOWN 97%.

IN HIS FIRST 19 MONTHS IN OFFICE, PRESIDENT BIDEN’S ADMINISTRATION AWARDED JUST 203 LEASES TO OIL PRODUCERS TOTALING AROUND 130,000 ACRES. 

FORMER PRESIDENTS TRUMP AND OBAMA APPROVED 10 TIMES AS MANY LEASES AT THE SAME POINT IN THEIR RESPECTIVE PRESIDENCIES.

PRESIDENTS CARTER AND REAGAN PUMPED UP OIL LEASES TO RECORD HIGHS DURING THE 70’S AND 80’S TO COMBAT THE OIL CRISES OF THAT TIME.  

REDUCING OIL AND GAS PRODUCTION ON FEDERAL LANDS WAS A CAMPAIGN PROMISE BY BIDEN, AND THE INDUSTRY HAS BEEN MOVING TOWARD DRILLING ON PRIVATE OR STATE-OWNED LANDS. BUT THIS YEAR’S RECORD GAS PRICES, BROUGHT ON BY SOARING INFLATION AND RUSSIA’S INVASION OF UKRAINE, IS FORCING THE BIDEN ADMINISTRATION’S HAND TO SELL MORE LEASES.

THERE ARE ABOUT 35 MILLION ACRES BEING LEASED FROM THE FEDERAL GOVERNMENT RIGHT NOW, AND WHILE MORE THAN HALF OF THOSE ACRES AREN’T ACTIVELY PRODUCING, OIL EXECS SAY THOSE LEASES ARE LIKE RAW MATERIALS. AND HAVING A STEADY SUPPLY OF RAW MATERIALS IS ONE OF THE BEST WAYS TO KEEP COSTS DOWN.  

WITHIN WEEKS OF THE UKRAINE INVASION, PRESIDENT BIDEN ANNOUNCED HE WOULD RESTART THE GOVERNMENT’S ONSHORE LEASING PROGRAM.

KEEPING THE PRICE OF OIL DOWN WILL BE CRITICAL IN THE COMING YEARS, AS FEARS OF A GLOBAL RECESSION CONTINUE TO MOUNT AND THE PRICE FOR OTHER ENERGY SOURCES ARE ALSO GOING UP. THIS WEEK, THE INTERNATIONAL ENERGY AGENCY SAID DEMAND FOR COAL WILL REACH RECORD HIGHS, SENDING GLOBAL COAL PRICES TO RECORD HIGHS AS WELL.