alt Hacker NewsThe US has long sought to erode OPEC’s ability to dictate global oil prices. The US has made massive progress in being broadly energy independent to isolate it from challenges elsewhere. The US has been a net energy exporter since 2019. Global oil pricing was always an annoying thorn in that strategy.
This is an initial but big crack in shaking up global oil markets in a way that meaningfully shifts global power dynamics.
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They export because their own refineries along the Gulf coast esp were designed for middle east heavy crude cuz the US once upon a time believed it was about to run out of American light sweet crude. So the story is not black and white.
Cheap and plentiful fossil fuels.
We’re rolling back CAFE standards too.
I think the initial crack was ousting Maduro in Venezuela. Since OPEC exempts Venezuela from production caps, it gives the US government a lever on non US production.
Global pricing affects all fossil fuels and always will. Energy independence will remain a fantasy until we are fully on renewables. Which is entirely within reach and requires fighting zero wars.
The US isn't insulated from global oil supply shocks because crude oil and refined petroleum products are traded on global markets and natural gas is somewhat traded on global markets (there are limits to LNG exports).
So yes the US could limit or ban exports. Many countries (including China) have done this in a kind of energy nationalism, but that hangs out allies to dry in a way that would make the US deeply uncomfortable. It would threaten European energy security. It would come at the cost of Latin American exports. So there's a cost to pay.
And more to the point, no US government regardless of party is going to hurt corporate profits by limiting exports. Biden could've done it in 2021-2022 and didn't. And Trump certainly won't. As one example, a big release from the SPR was on an oil-for-oil basis. Rather than cash ii on high prices, it's just a massive gift to oil companies who have to repay the oil (and then some) at some unspecified future point when oil will be cheaper. That's billions the US could've added to government coffers.
I do agree there is a power shift going on but not because of US energy independence. No, it's because the US cannot militarily protect GCC countries and cannot force open the Strait of Hormuz or guarantee global shipping, which has essentially been a US guarantee since 1945.
I do think this administration does want to crack OPEC but that's likely to be of massive benefit to China without China having to do anything.
This is horrible from POV of mitigating the climate catastrophe and the global death toll. We (as in humanity) are really late in ramping down fossils production and use.