Photo by Timothy Newman on Unsplash

Is the only way to stop oil prices from going up is to impose another covid style like lockdown? That’s what the International Energy Agency (IEA) seems to be suggesting. IEA Executive Director. Dr. Fatih Birol is quoted as saying that there is an oil emergency and “that reducing oil demand does not depend only on governments but also citizens and corporations. Measures that they should take would include lowering speed limits, making people work from home, more public transportation, and urban car-free days. Birol says that this could quickly cut oil demand by 2.7 million barrels a day but one of the reasons we are in this energy crisis in the first place is because International Energy didn’t do a very good job in reporting global oil inventories.

The International Energy Agency admitted that they lost 200 million barrels of oil. That was probably due to either underestimating demand or overestimating global oil production. It raises the question of whether the International Energy Agency manipulated data to try to push a green energy agenda. Now that the world is facing an energy crisis, they want to go back to the days of lockdowns which of course has caused a lot of negative consequences on society.

The energy conservation days harkens back to the days of President Jimmy Carter who famously wore a sweater try to tell the American people that the only way the world was going to survive the energy crisis was to change our way of life. The United States did become much more energy-efficient and President Carter did help that. Still, we miss all the cars that used to give us 10 miles to the gallon. They were cool. Back in the 1970s, we created that false notion that we couldn’t drill our way to energy independence. That may have seemed true back in the 1970s but innovation by the US energy industry changed all of that. Determination, grit and the pursuit of profits helped unlock the mystery of shale oil and gas and forever changed the energy landscape.

Mr. Birol also is saying that he hopes that OPEC will be able to relieve oil market strain. Yet while he is calling for more from OPEC, his organization last May said that countries must halt all investment in new fossil fuel supply projects and green light no new coal plants. Many listened to him and the war on oil investment was on adding to our global shortfall. Reuters reported a year ago that U.S. Treasury Secretary Janet Yellen said she will push multilateral development banks further away from fossil fuel projects, saying she would ask them to increase their climate ambition “to support the Paris Agreement on carbon emissions reductions. Yellen said to development lenders and the World Bank, to boost efforts to encourage more private-sector climate-friendly investment.

That’s what Europe did and that’s why they are still dependent on Russia for natural gas and oil. Even as Russia invades Ukraine and commits unspeakable acts against a sovereign nation, Europe is still sending them money to pay for oil and gas.

The main reason is that Europe bought into the Paris climate accord madness which subsidizes countries like Russia and China so they can continue to pollute while the rest of the world becomes more dependent on rogue nations such as Russia and OPEC. This is also why the Biden administration is desperate to try to get a nuclear deal with Iran and is reaching out to Venezuelan President Maduro.

Now there must be a study done as to the damage caused by global lenders. When the Treasury Secretary of the world’s largest economy tells lenders around the world to stop investing in fossil fuels and should move that money towards green energy, I think it deserves an investigation. How much money was diverted away from fossil fuels into green energy projects? How much energy has been provided to the world from that diverted money?

How come the International Energy Agency is calling on OPEC to raise production and not looking towards the green energy companies to raise production or provide more energy or solve our problems? It’s possible that we diverted billions of dollars away from fossil fuel investment into green energy. Where is the return for the investment? We need to know how many dollars have been diverted away from fossil fuels and into green energy projects. We need to know how much and where is the energy return from those billions of dollars of investment was pushed by the Treasury Secretary of the United States?  I think it’s a fair question.

In the meantime, small oil and gas producers are having a hard time getting credit. It seems that these policies are going to squeeze out the small mom-and-pop oil producer. Maybe this is the plan or maybe they have no plan. Or maybe they see the world through green-colored glasses and can’t see their nose in front of their face.

Bloomberg reported that “Texas is seeking information from BlackRock Inc., JPMorgan Chase & Co., Invesco Ltd., and 16 other firms on whether they discriminate against the fossil-fuel industry “Many of the largest U.S. banks are restructuring their lending portfolio in response to pledges by President Joe Biden and other world leaders to pursue a net-zero emissions future. Citigroup Inc. last year said it won’t provide services to certain oil and coal projects, and Bank of America Corp. has promised to zero out greenhouse-gas emissions across its operations. Blackstone is telling its clients its private-equity arm will no longer invest in crude exploration and production. Hegar’s office declined to identify the firms it has contacted but said another round of letters will be mailed to more than 100 other investment houses that appear to have at least one fund boycotting fossil fuels.

There has to be accountability. Trying to starve the EU oil and gas industry of capital coming down from the highest part of the Biden administration, has hurt our energy industry. To keep gasoline prices low, energy companies need a constant flow of capital and if it gets cut off, it is going to restrain production and supplies. If there are fewer supplies, then markets go up.

Oil prices rebounded back above$100.00 a barrel. The outlook is bullish. Get hedged.

Natural gas prices had a nice run with a retouch of $5. Global demand for LNG exports and the Biden administration moving on that is going to support prices. Still, at $5 we may get a bit of a pullback but you might want to get hedged for the summer months.