C8 wrote:Saudis Unwilling To Upset Putin As Biden Begs For More Crude
The Saudis may have the spare capacity but be lying about not having it. Biden can't know what they really have. If I were their king, I would lie and tell the US that I have no spare capacity anymore. It would save oil for future years, keep current prices high, and sounds like I would still help the US if I could. Te King would be dumb not to lie.
Agreed. Since I was a teen (50 years), it was obvious to me that OPEC, including the Saudis, and the Western wealthy economies each had their own self-interest, and would mostly hew to that, while sometimes pretending to be "friends", re to the extent of their long term economic self interest.
Over time, it's painfully obvious that total global crude oil demand will decline a LOT from here as the world transitions from ICE to BEV over the next few decades or so (varying speeds for different locales, depending on circumstances like infrastructure, wealth per capita, etc).
So though there will be a LOT of (likely) increasing demand globally for things like petrochemicals, the days of very high crude oil prices which OPEC can easily manipulate significantly are likely numbered. So if I were SA and more largely OPEC+, I'd be looking to try to keep prices relatively high for the long term. Once people get used to it, they'll complain less, resign themselves to it, and pay up. But of course they can't push TOO hard, because if prices are REALLY high, people get mad, more aware, etc. and will transfer to EV's, and especially cheap and quickly available HEV's far more rapidly, which is bad for crude prices over time.
And yeah, politicians lie all the time to protect their self interest, so if some minor lies will help KSA, et. al. with their goals to keep oil prices fairly high over time, I'd expect them to tell those to big customers like the EU and the US.
Like is always the case with economics, the forces of supply vs. demand creates a necessary balancing act.
I just roll my eyes whenever a POTUS cries about oil prices and asks OPEC, et. al. for help. If the west were SERIOUS about being energy independent and/or having low crude prices, they'd MAKE THAT HAPPEN over time by intelligent and persistent POLICY, pursuing what works, even if it's expensive and inconvenient in the short term.
CLEARLY the west mostly doesn't do that. Western Europe does a little by having a good public transport network generally, and having high enough crude oil product taxes to encourage conservation, having small or no cars, etc. The US -- basically, NOT AT ALL -- except the whining when oil prices spike significantly and that affects politics vs. the party in power.
Same as it's been since I started paying attention in the early 70's with the first big oil price spike and OPEC oil embargo.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.