Wait, Why Is President Loud Stupid Bragging About Raising Gas Prices Now?
Conservatives love the free market! They hate it when government picks winners and losers, because they hold a deep-seated, almost religious belief that the invisible hand of unfettered capitalism will guide us to the most efficient result. It's called principles, people. Read your Bible!
JK, LOL these assholes believe in NOTHING. Which is why the president spent the weekend jabbering on his Obamaphone with his good pals Mohammad bin Salman and Vladimir Putin to prop up the price of oil. Because a month ago Trump's Pal Pootie crashed the world oil market, and American oil producers have been howling for the president to make gas more expensive so they don't go out of business.
Needless to say, there is no source for the "hundreds of thousands of energy jobs" claim. And as for the "Great deal for all!" well, that remains to be seen. But first the backstory!
See, six years ago the Organization of Petroleum Exporting Countries (OPEC) and Russia agreed to flood the market with oil to drive American shale producers out of business. Their hope was to make dead dinosaurs so cheap that it didn't pay for American companies to suck 'em out of the ground. Only it didn't really work, so OPEC and Russia basically tapped out in 2016 and agreed to cut production and raise prices again. But then US producers also ramped up production, which meant that OPEC had to keep on cutting back just to maintain a level supply at a sustainable price. And that was before coronavirus confined us all in our houses and grounded most airplanes.
In December, the US pissed off Putin even more by imposing sanctions to effectively halt the $11 billion Nord Stream 2 oil pipeline that would have allowed Russia to export gas directly to Europe, bypassing Ukraine. Plus, we made it more difficult for Russia's state-owned oil company Rosneft to do business in Venezuela.
So in March, Putin marched into OPEC and shouted, I will no longer allow Mother Russia to be raped by swarthy men in dresses and drunken louts from North Dakota! Russia is turning the taps back on. And MBS was like, Oh, yeah? Well fuck you then, we'll just flood the market with the cheapest oil yet! And Mexico was like, Burn it all down, pendejos! And American oil producers were like, Oh, save us with your big brain and enormous, manly hands, Donald Trump! More or less.
Which is why you'd see such cheap gas if you ever left the house and tried to fill up your car. Here's a cool picture from the New York Times.
So, after a month of doing fuck all, Trump lurched into action. Because, despite all that nonsense about Obama, and Solyndra, and picking winners, he sure as shit isn't going to let his pals in the oil and gas industry fend for themselves. In the end, OPEC+ — that's OPEC, plus Russia, Mexico, and eight other countries — agreed to cut production by 9.7 million barrels a day starting in May. All well and good, of course, except the world is in the middle of a pandemic-induced economic recession, with demand reduced by 20 million barrels a day. And we are not a math major, but 9.7 million appears to be less than 20 million.
Which is why Trump's "historic" deal barely had an effect on the price of oil. Here's a cool picture from Bloomberg.
RUH ROH. American shale producers cannot stay in business at $30/barrel. Time to, ahem, massage that data some more!
Apparently, the OPEC statement announcing a 9.7 million barrel cut in May and June, gradually decreasing to 5.8 million barrels in January of 2021, is fake news. The "real" deal is the 20 million barrels Saudi Arabia wanted to take credit for, but everyone else told them was bullshit accounting. The Wall Street Journal reports:
Saudi Arabia pushed to tout the 20-million-barrels-a-day amount in a press release announcing the final agreement but faced resistance from other countries that argued it was inflated. The figure takes into account the 9.7-million-barrels-a-day production cut and 3.7 million barrels a day from Group of 20 countries that are mostly market-driven declines.
It also includes existing sanctions on Iran and Venezuela and outages in hot spots such as Libya, according to a draft press release.
Why won't the lamestream media give Trump credit for an accounting trick so hinky even Putin was like Nyet, brah? Why didn't the price of oil magically rise at Trump's command? Why does no one believe Larry Kudlow and Steven Mnuchin when they promise that the economy will be better than ever in the third quarter?
UNFAIR! HOAX! RIGGED!
On the plus side, without all those cars spewing smog, you can actually see the stars at night now. Cue the Drudge sirens for LIBERALS CHEERING PANDEMIC TO PROMOTE RADICAL GREEN AGENDA in 3...2...
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Liz Dye lives in Baltimore with her wonderful husband and a houseful of teenagers. When she isn't being mad about a thing on the internet, she's hiding in plain sight in the carpool line. She's the one wearing yoga pants glaring at her phone.