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As Biden Loses Saudi Arabia, Gas Prices to Skyrocket Again

Posted on Tuesday, October 11, 2022
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by Daniel Berman
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AMAC Exclusive – By Daniel Berman

Hopefully everyone enjoyed “lower” gas prices while they lasted. OPEC leaders, meeting in Vienna, voted last week to cut global production by 2 million barrels a day – a shot across the bow of both the European Union, which has angered OPEC by trying to impose price caps on gas, and the Biden administration, which had publicly begged Saudi Arabia to increase production as it runs the U.S. strategic petroleum reserve down to historic lows.

In taking this step, the Saudis and other OPEC members have decided to make clear that they, not the European Union, set prices, and that they can cut production for longer and further than Biden can manipulate prices with his strategic reserve. It was a power-play, plain and simple – one that undercuts Biden’s international credibility and Democrat hopes of winning the midterms by manipulating gas prices. It is also one which Democrats, by their own actions in 2020, left themselves open to.

In the spring of 2020 amid the onset of the pandemic, prices for oil futures in North America briefly dropped into negative territory. While markets panicked, the Trump administration spotted an opportunity to pull off a spectacular deal for the American people: the United States government would purchase the oil to refill the strategic oil reserves at almost no cost, while the energy industry would be saved from collapse in the midst of COVID-19.

But House Democrats, convinced that fossil fuels were on the way out, a belief only reinforced by the collapsing price of oil, rejected what they termed a “bailout” of the energy sector. Their actions not only discouraged investment, reducing production capacity at home which the Biden administration would have dearly wished to have this spring, but has also now left the strategic reserve depleted, and the taxpayers on the hook to replenish it at four times the cost in 2020.

Having weakened domestic production, Biden also spent a year antagonizing Saudi Arabia before pivoting toward conciliation only after the Russian invasion of Ukraine shifted the balance of power in the relationship decisively in favor of Riyadh, which reduced the effectiveness of any shift. Rather than a restoration of relations in which a supplicant Saudi Arabia accepted Biden’s leadership, the President’s trip to Saudi Arabia this summer was a series of slights.

The bankruptcy of U.S. influence was evident in the leadup to the OPEC summit. According to CNN, the White House undertook a massive lobbying effort which included sending Secretary of the Treasury Janet Yellen to the region to personally lobby gulf leaders. “There is great political risk to your reputation and relations with the United States and the West if you move forward,” read some draft White House talking points for Yellen. The White House’s communications strategy was similarly a bizarre mixture of threats, only effective if the U.S. radiated confidence. Panic, which advertised weakness, nullified the threats. As CNN reported: “Some of the draft talking points circulated by the White House to the Treasury Department on Monday that were obtained by CNN framed the prospect of a production cut as a ‘total disaster’ and warned that it could be taken as a ‘hostile act.’”

Threats can be effective if they are credible. The problem is that the actions of the Biden administration, along with those of the European Union, sought to threaten OPEC without the credibility which would have made them effective. The Biden administration’s efforts to use the strategic oil reserve to manipulate prices may have been primarily intended to buy the Democratic Party votes, but it also came off as an effort to prove that Biden and his team could challenge OPEC control of prices. If Biden could succeed, even for a few months, in making U.S. oil prices “international production-proof,” then a wiser President, one who had adopted Trump’s approach and built up the strategic reserve to two or three times its current level, might be able to sustain a geopolitical standoff with the Saudis long enough to prevail. Therefore, Biden’s very effort to lower prices without Saudi help ensured that Saudi help would not only not be forthcoming, but that the Saudis would do everything possible to raise prices.

At this point, Biden’s only direct weapon was geopolitical threats – hence the leaked Yellen talking points. But these threats could only be effective if Riyadh believed Biden could actually follow through.

There was never a chance of this. First of all, the Saudis know the level of the U.S. strategic reserve. They therefore know that they can cut production whenever they choose, but Biden only has a finite amount of oil he can release. Secondly, it is unclear what leverage Biden has over the Saudis. What is the risk to Riyadh’s “relations and reputation” with the West if Biden’s team have already called the Saudi Crown Prince and new Prime Minister a murderer, and accused Saudi Arabia of atrocities in Yemen? If Biden will consider a production cut a “hostile act,” what will he do in response? Refuse to buy Saudi oil in addition to Russian oil? Where will he then get the oil he needs?

In short, by bluffing, and doing so transparently, Biden forced the Saudis and their allies to call his bluff. Even if the Saudis had wanted to help the United States geopolitically, if they had declined to raise oil prices after Biden threatened them if they did, they would have been sending the message that they had given in to Biden’s threats. This in turn would have encouraged Biden and his team to think this approach worked and to threaten the Saudis in the future with “risking their relations and reputation with the West” if they committed “a hostile act” by doing anything Biden disliked.

In short, in 2020, Democrats removed much of the United States’ leverage by undermining its energy independence and opposing the replenishment of the strategic oil reserve. Not only are they now being forced to authorize purchases to refill it at $80 a barrel when Donald Trump had secured a deal to do at $24 a barrel, but they also left themselves without leverage in their relationship with Saudi Arabia. Then, rather than recognizing that this precluded conducting the relationship with Riyadh from a position of strength, they proceeded to make impotent threats, all but forcing the Saudis to call their bluff.

In the aftermath of the meeting last week, Biden and his team were desperately trying to spin the outcome, suggesting that his visit to Saudi Arabia this summer had not been about oil in any case, and therefore could not be a failure. Yet they could not hide their disappointment. Jake Sullivan, the National Security Adviser, and Brian Deese, the Director of the National Economic Council, issued a statement declaring that “the President is disappointed by the shortsighted decision by OPEC+ to cut production quotas while the global economy is dealing with the continued negative impact of Putin’s invasion of Ukraine,” while promising to consult with “Congress” on future moves.

In the meantime, far too many Democrats let vent to their impotent frustration. New Jersey’s Bob Menendez, the chair of the Senate Foreign Relations Committee, at least until the midterms, declared “enough is enough,” threatening to cut off arms sales unless the Saudis change their position on the Russo-Ukrainian conflict.

Yet behind this bluster, lay panic. Having ruled out any further use of the strategic reserve a mere 24 hours earlier, with White House Press Secretary Karine Jeane-Pierre declaring that “We’re not going to be considering any more releases from the Strategic Petroleum Reserve beyond the 180 million barrels” Biden had previously ordered released, the administration reversed course and announced the release of an additional 10 million barrels. Conveniently, this release would only last through early November, when the midterm elections take place.

Let there be no mistake: there are few options available to the administration. They can try and accelerate the depletion of America’s strategic reserves to try and aid Democrats in the midterms and then blame the subsequent price increases on Republicans, but the simple truth is that when it comes to energy and the geopolitics around it, they have checkmated themselves. Without domestic self-sufficiency, Biden and the Democrats have made the American people dependent on foreign sources, and the more foreign suppliers Biden and the Democrats alienate for political reasons, the less leverage they have with the remainder.

The administration needs to get serious about an energy strategy, rather than resorting to the same impotent threats with which they have conducted domestic policy.

Daniel Berman is a frequent commentator and lecturer on foreign policy and political affairs, both nationally and internationally. He holds a Ph.D. in International Relations from the London School of Economics. He also writes as Daniel Roman.               

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Michael J
Michael J
1 year ago

Can this idiot and his handlers destroy this nation any further?

Stephen Russell
Stephen Russell
1 year ago

GET Our own energy back up OK NO Games

Carole Wenger
Carole Wenger
1 year ago

Biden and all his crew should be in jail for treason!! They are corrupt, evil and worthless!

Patty L
Patty L
1 year ago

I miss Paul E’s comments. Are you still out there, Paul?

Kendall
Kendall
1 year ago

They, biden and his communist pos cronies, caused every single bit of this problem. EVERY SINGLE BIT!

Patriot Will
Patriot Will
1 year ago

Biden has no credibility in being a player in the world market for greater oil production. The Saudis do not respect Biden, since he has seriously cut America’s ability to produce its own oil, while sporadically spouting off negative remarks and making false proclamations of his ability to influence the Mid East, The Saudis know that Biden is inconsistent, flippant, full of himself, and incompetent. They do not consider Biden a strong leader, because he isn’t. Biden does not even have the sense to allow his own country to produce as much of its own oil as possible.

Nick Murphy
Nick Murphy
1 year ago

It is unbelievable how stupid Democrats are. It’s obvious to anybody what can be done, turn on the oil production here that you already shut off don’t go begging to dictators for more and quit selling oil to China. Biden is really making Carter look like a good president. I don’t know how anyone can belong to that party and look at themselves in the mirror everyday. I wonder how many people are on the government payroll that do nothing everyday but cover for Biden, and that does not count the media

Dave
Dave
1 year ago

Thank-you

Jeb
Jeb
1 year ago

This should be beyond obvious. Shame on you if you are in shock and awe.

Ken Westenkirchner
Ken Westenkirchner
1 year ago

Biden recently mentioned “Armegeddon”….I’m praying the elections in 30 days are just that..a referendum eliminating/minimizing Biden & his fidiot administration.
Please just go away. U & ur ideas r destroying this country.

Bob Curtis
Bob Curtis
1 year ago

The republicans/conservative parties should attack the democrats with vigor. The Democrats are the slavery party. The party of the KKK. Biden gave a eulogy for Sen. Byrd of West Virginia when the senator died.

Duluth Tom
Duluth Tom
1 year ago

Obama called it. Joe has been wrong on every decision. Dems live purely on emotion. Conservatives, for the most part, rely on logic. Their energy policy is lollipops and sugar plums and it’s going to hurt the US and the world. Very sad what they have done in two years.

Charles
Charles
1 year ago

We all know the solution , get rid Of The Biden Administration , Close The Border , Open The Pipeline , Return Justice To AMERICA , Stop The Drug’s & Crime . We Can Begin in NOV By Voting G O P & Turn The Congress in our favor – GOD BLESS AMERICA , ONE NATION UNDER GOD , WHERE FREEDOM LIVES BECAUSE OF THE BRAVE

Smili'in Jack
Smili'in Jack
1 year ago

To the rear, march!!!

porterv
porterv
1 year ago

Not only are we cursed with the dumbest most inept individual to ever be named the president, Joe Biden, but he has surrounded himself with people even dumber than he is.

Scott S.
Scott S.
1 year ago

Very well stated. To the point and absolutely the truth about what is happening with this incompetent and disingenuous administration. They are all corrupt to the core!

THX 1138
THX 1138
1 year ago

We were completely energy independent less than two years ago and all it took to trample that into nothingness was the installment of two Executive Branch jacka$$e$ by 2000Mules!

Philip Hammersley
Philip Hammersley
1 year ago

Biden and his wokesters (and some Republicans) didn’t like the fake “journalist” Khashoggi being killed so they call the crown prince and Saudi Arabia names. Khashoggi was supporting Yemeni terrorists and the crown prince, unlike our people, try to eliminate traitors. Now, they expect the Saudis to bail us out after Senile Joe shut down OUR oil. Like the old saying goes, “Don’t p*** on my leg and tell me it’s rain.”

Kyle Buy you some guns,and learn how to shoot
Kyle Buy you some guns,and learn how to shoot
1 year ago

I dont see a problem. Horse and buggy will get you to work. Now where you gonna get all them horses and buggys ???? Kyle L.

Kyle Buy you some guns,and learn how to shoot
Kyle Buy you some guns,and learn how to shoot
1 year ago

wELL LESS SEE. 16 YEARS OF GAS BEING 3 DOLLARS AND UP A GALLON. 4 YEARS OF tRUMP ,GAS GETS DOWN JUST UNDER 2 DOLLARS A GAL. wAY TO GO dEMS. kYLE l.

Cindy
Cindy
1 year ago

If Biden had not cut off America’s own gas production, we wouldn’t be where we are today my other real problem with this and all matters of big government, tyranny that has overthrown our government, the republiczn party have sat back and allowed thus take over. Why? Because most of them are bought by democrats, deep State, the globalist. They have turned their backs on we the American people. They are just as guilty. Our Republican Party needs to repent, bring God back in their lives, back in the White House and the American people need to do the same. If not we will leave a communist ONE WORLD GOVERNNENT for our children and grandchildren. We will have ourselves to blame. I cannit live with such guilt.I love God, my family, my fellowman and my country. I can’t believe I sit here today saddened and disappointed in the Republican party and the American people. God and our Founding Fathers made clear a one nation under God stands, a nation devided, a nation of people who have turned from God will fall. It does not take a college degree to understand basic Godly principles. Please awaken America to the real truth . We are fast running out of time

michael deprisco
michael deprisco
1 year ago

This radical left Democrat thinking is wracking this country. Biden goes around we are going to eliminate fossil fuels. Can you please make more oil. What a joke this looser is and the people that put him in office.

PIDL
PIDL
1 year ago

Is this not a ploy by the Socialist Democrats to deplete our reserves so low that we would not have the reserves to keep the U.S. going and supply a military effort.? I do not trust Biden or any of the people now in power in the deep state not to do that.

They are looking for the way to destroy America and make it look like it was the Saudis, Russia, and OPEC members who are at fault. Then they can declare war on them and start this next world war, or capitulate to the Chinese knowing we have no way to defend ourselves because we do not have enough oil reserves.

This is an extremely scary situation!

Cindy
Cindy
1 year ago

Someone explain to me first of all, why is a CCP allowed to even exist in America? Why is a CCP police force allowed in New York City? Wake up people! Why would our so called Republican Party just sit back and allow this? Do people think our Founding Fathers would have allowed this or any of what has taken place? The answer is clearly, NO! We better get ourselves united together under God. Repent, put God back in our lives and stand up together united under God, stand up for God, our Founding Fathers, our Constitution. for those who have not read the Constitution, Bill of Rights and Declaration of Indeoendence, you better start reading them all, these are tights and laws given to us, the people. It instructs on how Government is to be run. When tyranny takes over, its then up to us to help save our Nation, our Government, especialky when Manu of the Republican party has been bought and a part of the tyranny. God only intended there be a small Governmeny that worked and do good for the people. To many say they believe in God, yet are doing nothing but waiting on Trump or someone to save them. We as a people must make the Republican Party understabd that WE THE PEOPLE will understand no we no longer except excuses, for useless theatrical committee hearings that bring no results. .look at where the Republucan party stands in your state, in Washington DC on digital currency that will take ALL of our freedoms. They are not Stabding up and saying No people THIS should be a STRONG NO with every Republivmcan senator, congressman and women. The majority of the Reoublucan Party are not standing. Fighting for the rights, laws and freedoms bestowed upon us by God. They have ventured away from Constitutiinal rights and laws because they are themselves caught up in packing their own wallets at our expense, at the expense of our children, grandchildren and future generations. I email, call my senators, congressmen and demand answers, to get nothing back. If I’m lucky I get told the sane old sentence over, ” I am doing all I can to fight fir the people of our state and America! That is NOT good enough for ne. It’s empty words We as a people have allowed this to happen but we as a people can get right with God and do exactly what our Constitution gives us the right and law to do. Our Founding Fathers through inspiration from God built this Nation. We would not have an Ameruca had it nit been Gods plan and used our Founding Fatgers whom he knew were Godly men to build this Natiin and see to it that we the people were a free people. Able to exercise the freedoms, the free agency given to us at birth. I ask, are we going to just ignore God’s plan for us all ? Or are we going to stand abd preserve our freedoms, our liberty that God so freely lovingly blessed us with? It’s up to us now to do the right and Godly thing fir our families and our Nation.

johnh
johnh
1 year ago

Someone needs to explain to Joe Biden that the Strategic Oil Reserve should be only used for national emergency. Also, this article says Biden will replace at $80 bbl & how do you know that & you are assuming he will replace during his term.

Adonis
Adonis
1 year ago

For the radical left someone else’s oil is good, but never our own. To expect OPC to bail out our radical left while they are shutting down our own oil exploration and production is beyond lunacy. Now they are going to push Saudis into the arms of our greatest adversary Chi-coms. Speaking of destroying our country? It doesn’t get any worse.

Hdrydr
Hdrydr
1 year ago

This is real easy… You can’t lose what you never had. The saudi’s were doing what the rest of the world is doing. LAUGHING at the second “pretender” president that’s doing the bidding of the 1st “pretender” president. It was planned this way in advance. Obozo is the stink on the crap of biden’s illegitimate regime.

johnh
johnh
1 year ago

I have heard somewhere that the USA is exporting 3-million bbl of oil/day at current time & that USA is still buying oil from Russia. Can anyone verify these or are these just rumors ?

EMG
EMG
1 year ago

Seems Biden is rushing helter-skelter to petroleum Armageddon! No oil left in reserve and no country to import from. Wonder what clown act he will come up with then?

Morbious
Morbious
1 year ago

I could stand five buck gas if it meant dem robots would wake from their trance but they wont so its hard to see a silver lining in this. It might get a few independents to vote however.

Steven Tapper
Steven Tapper
1 year ago

If you ever doubted the clear logic of the America first doctrine of Donald Trump this is it. It’s utterly insane and naive to try to kill off the fossil fuel energy industry without totally killing our economy! The Democrats love to pick winners and losers in their policies. However they never quite think through all of their actions in the long run. Now it’s going to cost them the midterm elections and the Presidential election in 2024. It’s just the shame that we all have to live with their bad decisions that are costing us and the country big time!

Enuf Said
Enuf Said
1 year ago

As AMAC pointed out last month, the Dim ideal is to either===RULE or RUIN!!

Granny25
Granny25
1 year ago

Why do we keep getting oil from other countries when our own country has enough to supply the US for years to come? Biden is a dementia ridden idiot.

james carlyle
james carlyle
1 year ago

The KSA has never been a reliable allay of the USA and is currently following their traditional path of of protecting their assets.

Phyl
Phyl
1 year ago

Bozo Joe, open the pipelines. Think about We, the people, for once in your sorry life.

TOMASD
TOMASD
1 year ago

I’m glad it happened before the mid-terms. I can’t believe I’ve been hearing people say that gas prices have gone down thanks to Joke Biden. It’s amazing how stupid a lot of people really are. I guess they forget where the gas prices were BEFORE Joke took office. Americans are just getting dumber and dumber and the dems count on it.

Randall L. Beatty
Randall L. Beatty
1 year ago

Big Joe’s plan make his party look good before the mid terms but it backfired on them. I thought that the price for gas would go back up what surprised them it went up faster then they planned they are busted the oil reserves are down and we are at the mercy of other countries which does not bother this Biden party one lie after another they will find out come November.

Hal
Hal
1 year ago

One thing you can count on with Joe Hidin’ Biden ….if he is for something, that something is almost surely bad for the Nation.

GTPatriot
GTPatriot
1 year ago

As the value of used gas cars shrink to $1500 and the price of e-vehicles rises to $150K, US citizens ( not Americans. Venezuela is part of America. STOP CALLING ME AN AMERICAN !!!) will be buying more bicycles. Chicago will look like Amsterdam. In fact, where I live on weekends the roads are full of bikers on $3000 bikes which is more than a gas powered car costs. No wonder everyone is looking for a stay-at-home job. US business better wake up and realize that having employees who drive to the office every day with $25 parking cost and $50 per day gas cost is now a luxury. Plus pay $15 for lunch. Only for the $150K +crowd. Good luck in finding a competent, educated, reliable daily worker for $75K (peanuts) willing to drive to the office and home each day with a smile on their face. Added to that is the 2 hour ( 1 hour each way) drive time that workers in cities like Atlanta have to put in. The days of the 80’s -90’s- when employers expected workers to stand on their head are GONE. Send those jobs to China ( I think we already have, fortunately). Rather be unemployed here that be a Commie there.

GTPatriot
GTPatriot
1 year ago

With my new bicycle and candles at home with a wood stove, I think I can make it this winter.
Anything to make Joe happy. My public school 4th grader can now count to three. What more should I expect. Many of us are just too greedy.

dennis
dennis
1 year ago

Burizma Biden went to Saudia with orders to persuade them to increase oil production. Old senile fool, ended offering to sell all US oil reserves to them.

dennis
dennis
1 year ago

tis outrageous how high these gas prices are!" - Complained an old Scotsman to his friends. "But what are you griping about Mc.Donel? - You dont even drive a car?” Reminded him his friend. “Yay, I don`t drive cars, but my LIGHTER works on gasoline!” Justified himself, the old thrifty Scot…

Michael Lewis
Michael Lewis
1 year ago

OPEC Rejects US Dollar as Oil Currency! The West is Done!
Shawn Paul Melvilleby Shawn Paul Melville
civilianintelligencenetwork.ca/2022/03/17/opec-rejects-us-dollar-as-oil-currency-the-west-is-done/

BAE
BAE
1 year ago

Joe Biden has lost everything. He is so BAD I have no words left. He and his stupid administration are the worst. Disgusting president and democratic administration ever!!!!!!!!!!!!

Marie Langley
Marie Langley
1 year ago

DRILL BABY DRILL!!!!!!!!! It’s amazing to me how this president can be so stupid. Shame on all the people who voted for him because their feelings were hurt by mean Tweets by Trump. GET OVER IT!!!!!!
LET’S GO BRANDON!!!!!!!

Tom
Tom
1 year ago

Did you stop sending notification that the comment has been approved?

Sid
Sid
1 year ago

President Cabbage Brain couldn’t find his ass with both hands and a flashlight.

Steve Kujawski
Steve Kujawski
1 year ago

Yet again Joe and his knuckle headed administration and his flock of sheep in Congress have successfully lead us into another abyss that will be shackled onto the American public to pay for his blunders! He should never ever have put himself on his knees groveling to OPEC or Saudi Arabia, especially when we have access to oil reserves domestically! Complete the pipeline and DRILL!

Karen
Karen
1 year ago

IDIOT! ALWAYS WAS AND ALWAYS WILL BE.

A.Grace
A.Grace
1 year ago

I bet that if the Keystone Pipeline was reopened and drilling in America would be allowed again, OPEC would lower their gas prices because they basically wouldn’t have any other choice. It’s just unimaginable that the Democrats are so ignorant to that idea.

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