The U.S. is on the verge of a resource crisis, forcing the White House to actively take action to stabilize the oil market. Crazy gasoline prices in the U.S. have made the American public extremely angry, and large companies are losing huge amounts of money due to unpredictable spikes in the oil market.
The U.S. is experiencing a huge oil shortage. The last time such a shortage was observed back in 1987 and 2001. Currently, the U.S. has 532 million barrels of strategic oil reserves. Every week the number of million barrels is decreasing by 5.3 million. At best the U.S. oil reserves have two years left. But from February 25 to May 20, reserves fell by another 50 million as the manufacturing sector intensified. However, these are government resources. In addition, some of the oil is in the hands of the private sector, and their resources are sufficient for 8 years. The problem is exacerbated by the low rate of oil production in the US. The U.S. produces 11.9 million barrels of crude oil a day, with an average increase of 25,000 barrels a month. The U.S. has imposed an embargo on oil supplies from Russia, which has deprived Americans of about 500,000-600,000 barrels a day or about 15-18 million barrels of oil a month.
On May 23 the U.S. retail price of a gallon of gasoline set a new all-time record of $4.60 per gallon, or $1.20 per gallon. That’s the national average. In California, for example, a gallon costs $6.07, or $1.60 per gallon of gasoline. Prices dropped slightly when the US begun to empty its strategic reserves. A barrel of oil in the U.S. currently costs about $114.
The U.S. has long tried to implement a plan to redirect oil supplies from Saudi Arabia. Washington has attempted several times to persuade the Saudis to increase oil supplies to the international market so as not to create a deficit since the U.S. imposed an oil embargo on Russia. So far, the U.S. requests have been ignored by the Saudis. Increasing oil production would have meant Saudi Arabia breaking the OPEC+ agreement, which is more important to Riyadh than ties with America for that matter. It got to the point where the U.S. sent a delegation to negotiate with Saudi Arabia. White House Middle East Policy Coordinator Brett McGurk and Amos Hochstein, senior adviser for global energy security at the State Department, flew to Arabia. The meeting took place on May 24. The U.S. had hoped that increased oil production in Arabia would help expand the oil sanctions package for Russia and reduce the price of fuel in the U.S., as it has risen too much recently. The Arabian side responded that the oil embargo against Russia would anyway lead to a shortage of oil on the world market and that an increase in oil production in Arabia itself would not solve this problem. In this case, the U.S. will be able to use the No Oil Producing and Exporting Cartels Act NOPEC, which allows filing lawsuits against OPEC member countries. The essence of the lawsuit is a violation of antitrust laws. In practice, such a trick is quite difficult to implement, because the lawsuit will lead to a freezing of foreign reserves of Saudi Arabia in the U.S., and this can provoke a complete refusal of oil supplies from Saudi Arabia, and then the oil market would collapse.
The U.S. is considering the pressure on Venezuela and Iran as alternatives and attempts to “squeeze” more oil out of these countries by various means. For example, Washington has already lifted several sanctions against Venezuela. The situation with Iran is more complicated because there are fewer points of contact. In the long term, Iranian oil could replace the Russian onr, especially since it is cleaner than Russian oil. It is also possible that this scenario, which was not possible a few years ago, may take place. Russian oil could enter the market under the guise of Iranian oil.
Whether the U.S. succeeds in exerting pressure on oil-exporting countries through soft power or harsh measures, the future will show. If it succeeds, everything will remain as it is; if it fails, the State Department will have to lift sanctions against Russia at least linked to oil. The only question is whether Russia will want to restore supplies, because as Russian Foreign Minister Lavrov said, Russia needs to rely only on its strength, and it will consider whether to resume a dialogue with the West in general. It is not ruled out that Russian oil will flow to the U.S. through third countries, as was previously the case with Venezuela.Clio the cat, ? July 1997 - 1 May 2016 Kira the cat, ? ? 2010 - 3 August 2018 Jasper the Ruffian cat ? ? ? - 4 November 2021
So expect further attempts by US to oust evil socialist dictator Maduro honestly not for oil
"Nicolás Maduro - Wikipedia" https://en.m.wikipedia.org/wiki/Nicol%C3%A1s_Maduro Wikipedia's pages on Maduro are as toxically Washington right-wing as it gets. Bolivia's Morales was ultimately almost effortlessly removed ostensibly in part for Bolivia's lithium(outrage from the Left was and remains bizarrely, disappointingly muted).
The US will definitely launch another assault on Maduro - Guaido is still their place-man, President-in-waiting.
The US plan of mice and men of toppling Maduro in the past didn't quite work. Thereafter US tried to get Venezuela interested without giving them their gold back (from UK) or rescinding their position ref Guaido. Quelle surprise - that plan didn't work.
Secondly, Venezuelan crude is very heavy and only a small number of refineries in the US can handle it - they were specifically designed for Venezuelan oil. Obviously, the neocons don't want to spend the money by paying upfront - cheap skates.
Thirdly, Iran seems to be out of the picture since there is no deal on JCPOA. In addition, Saudis are not playing with Uncle Sam and will not increase their production. Hence Ruski crude is vital.
Casting aspersion on your imaginary left will get you absolutely nowhere:
Bolivia's lithium (outrage from the Left was and remains bizarrely, disappointingly muted).
You either haven't read or have forgotten many TLN threads regarding Morales and lithium. It won't save the world since it is a rare and dwindling resource, but it *is* a very valuable resource now, until it dwindles to nothing in the next couple of decades i.e. it has peaked, similar to Peak Oil.
If you wish to get genned up on the complex issues of oil and its meaning in geopolitics, especially with Russian crude oil vis-a-vis EU threatened embargo of Russian oil, you need to read this (the complexity of refining oil is mind-boggling):
Also thanks for responding. Not sure where you are missing the point young Jim.
There are five providers. The main sources of crude oil for the world consumption: Russia, Iran, Venezuela and Saudi Arabia.
There are other sources but they could be easily grouped into these five.
You may not like it, but oil rules. Very easy to evaluate that by seeing the current bun-fight for what it isn't. I cannot see anybody actually interested in global-warming tbh at the mo. It will come tbs (to be sure). Electric batteries are not the solution. I wish it was. No technofixes excpt change of the 'system' . Take yer pick.
on May 27, 2022, 7:16 pm
. Take yer pick.