Correlation ≠ Causation

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DAILY ENERGY NEWS | 04/12/2022

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Sleepy Joe's political showmanship is not what is bringing oil prices down.

Daily Caller (4/11/22) reports: "Global crude oil prices continued to slide Monday because of the sudden decreased demand sparked by China’s massive COVID-19 lockdowns, experts said. The Brent crude index, the worldwide oil benchmark, dropped to $98.93 per barrel Monday morning, falling more than 3.39% overnight. The U.S. WTI index decreased more than 3.75% below $94.30 per barrel Monday...President Joe Biden ordered the Department of Energy to release a whopping 180 million barrels of oil over the next six months on March 31. The International Energy Agency coordinated a separate release of 62.7 million barrels of oil among its 31 member nations. However, analysts said the release would be insignificant and have little impact on gasoline prices. Days after the release, global oil prices surged higher. 'It’s not a ‘strategic price reserve.’ It was never intended for this and it won’t do anything, just like the last one,' Institute for Energy Research President Tom Pyle told the Daily Caller News Foundation after Biden unveiled the action. The White House didn’t immediately respond to a request for comment from the DCNF."

"Instead of shifting blame to energy companies and disingenuous attempts to distract with political grandstanding, the Biden administration should be finding long-term solutions by taking advantage of our robust energy resources here at home."

–William Shughart II,
The Indpenedent Institute

Dear EU, why did you think it was such a great idea to become dependent on Russia's oil (and gas)?

Reuters (4/11/22) reports: "OPEC told the European Union on Monday that current and future sanctions on Russia could create one of the worst ever oil supply shocks and it would be impossible to replace those volumes, and signalled it would not pump more. European Union officials held talks in Vienna with representatives of the Organization of the Petroleum Exporting Countries amid calls for the group to increase output and as the EU considers potential sanctions on Russian oil. 'We could potentially see the loss of more than 7 million barrels per day (bpd) of Russian oil and other liquids exports, resulting from current and future sanctions or other voluntary actions,' OPEC Secretary-General Mohammad Barkindo said, according to a copy of his speech seen by Reuters. The European Union reiterated its call in the meeting for oil-producing countries to look at whether they can increase deliveries to help cool soaring oil prices, a European Commission official told Reuters."

Here’s a reminder that co2 emissions from coal are up 10% since Paris.

How many times do the "experts" have to get it wrong before they stop being experts?

Oilprice.com (4/10/22) editorial: "There has been an unspoken assumption that the West knows what it’s doing because it has been doing it longer than the East. Almost all developed economies are in Western Europe and North America. Yet recently, the tables have turned in one vital respect: energy policy. During the last few years, the EU has doubled down on its ambition to become the world’s first net-zero region. It has built up massive amounts of renewable energy, has slated huge investments in green hydrogen, and has been adopting policy after policy to discourage the consumption of fossil fuels. In the U.S., the big push into renewables started two years ago as President Joe Biden took office. The transition from a fossil fuel-based economy to one based on and fueled by renewable energy was a central tenet in his campaign, and he got to work from day one, banning the Keystone XL pipeline from Canada and soon after temporarily banning oil and gas drilling on federal lands. Meanwhile, far, far, away in the East, OPEC+ was formed to include two of the world’s largest oil producers—Russia and Saudi Arabia—as well as the Central Asian oil producers from the former Soviet Union, including Kazakhstan and Azerbaijan. The expanded cartel hasn’t always seen eye to eye, and just before the pandemic really blew up, the Russians and the Saudis engaged in a brief price war. Yet since then, OPEC+ has worked like a well-oiled machine."

Energy Markets

WTI Crude Oil: ↑ $100.60
Natural Gas: ↑ $6.67
Gasoline: ↓ $4.09

Diesel: ↓ $5.02
Heating Oil: ↑ $345.22
Brent Crude Oil: ↑ $104.90
US Rig Count: ↓ 752

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