Energy Report: Cool Down

Red hot oil prices cooled down after reports that OPEC Plus was prepared to “cool down the oil market with extra production.” The Bloomberg report caused oil prices to sell off into yesterday's close after recovering from the China bubble talk sell-off. Yet should the market have been surprised by that announcement? OPEC Plus not only expected to raise output but probably leaked that statement. It came by increasing pressure from India that has been complaining that the cartel has been driving oil prices higher. That is a role that the U.S. used to take yet the Biden Administration has been silent on OPEC Plus because they want higher prices. They want higher prices because it makes green energy more economical. Pressure from the Biden is causing talk and a major change in the outlook from the American Petroleum Institute that will further increase oil and gasoline prices.

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Image Source: Pixabay

The Wall Street Journal reported that “The oil industry’s top lobbying group is preparing to endorse setting a price on carbon emissions in what would be the strongest signal, yet that oil and gas producers are ready to accept government efforts to confront climate change. The American Petroleum Institute, one of the most powerful trade associations in Washington, is poised to embrace putting a price on carbon emissions as a policy that would “lead to the most economic paths to achieve the ambitions of the Paris Agreement,” according to a draft statement reviewed by The Wall Street Journal. “API supports economy-wide carbon pricing as the primary government climate policy instrument to reduce CO2 emissions while helping keep energy affordable, instead of mandates or prescriptive regulatory action,” the draft statement says. API’s executive committee was slated to discuss the proposed statement this week. In a statement to the Journal, API’s senior vice president of communications, Megan Bolomen, said the group’s efforts “are focused on supporting a new U.S. contribution to the global Paris agreement.” If you cannot beat them join them but America better is ready to pay through the nose for oil and gas.

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