The White House, which had been breathing a pre-election sigh of relief about falling gas prices, was thrown for a loop by OPEC+’s decision to slash oil production by two million barrels per day, which has already sent oil prices rising.
The New York Times said the cartel’s move showed “the failure of [President Biden’s] fist-bump diplomacy over the summer with the crown prince of Saudi Arabia.” The White House insisted that Biden’s effort was not a “waste of time”— but is now focused on limiting the damage.
The White House may now back bipartisan legislation that would revoke the sovereign immunity from U.S. antitrust law long enjoyed by OPEC, opening member states up to lawsuits over price collusion.
So far, the White House seems less interested in retaliation against Saudi Arabia—a longtime ally that recently cut a deal with Russian President Vladimir Putin—than in finding new sources of oil for the market, like a further release from the Strategic Petroleum Reserve or rapprochement with Venezuela.
Said Biden: “There’s a lot of alternatives. We haven’t made up our mind yet.”
One step would be to pursue a truly across-the-board energy policy, focusing on oil and traditional fossil fuels as well as renewables and other types. After the November elections, the Senate may again take up a bill from Sen. Joe Manchin (D-WV) that would lessen the impediments to approval of new energy infrastructure projects.
OPEC+’s aggressive action last week shows why such steps toward energy independence are so important.