All of us have not yet had time to fade from the memory of the "oil war" that has shaken the world energy markets not so long ago. The reason for this was the desire of the OPEC member countries to force Russia to reduce the production of "black gold" to the "level" indicated by them. After Moscow's refusal to follow other people's "valuable instructions", Saudi Arabia began literally "flooding" the world with flows of super-cheap oil, desperately dumping and trying in such a shameless way to survive from the markets of "these stubborn Russians." I must say that everything ended very badly (as is usually the case in the course of truly global conflicts). In fact, there were no winners in this confrontation, since all the countries-exporters of hydrocarbons “flew in”: after all, in the end, oil “collapsed” in price to the point of complete indecency. At some moments, its quotes on the stock exchanges even reached negative values.
All this happened in the spring-summer of 2020, and since then, having drawn very solid conclusions from the unsuccessful escapade that cost them all absolutely fantastic losses, the OPEC + participants work clearly and harmoniously, not leading to dangerous squabbles and conflicts. The volumes of increasing oil production are regulated, one might say, with surgical precision and by general agreement. The old Leninist principle: "Better less, but better" is observed by the "sharks of world capitalism" exactly and unswervingly. The price of "black gold" is growing steadily, delighting the countries whose economy closely related to its production and sale. However, as usual, there were those who did not like the current situation at all. We are talking, of course, about the United States, which thoroughly "had a hand" in the first oil war, and today openly unleashed it again.
"Come on barrel, come on barrel!"
First of all, it should be noted that the underlying reason for the current conflict lies not in the economic, but in political plane. Specifically, in the problems faced by the Joe Biden administration and the US Democratic Party, of which he is a representative. The rating of the current head of the White House has recently demonstrated any records, only negative ones. According to the omniscient Gallup, in April of this year it was quite a decent 57%, and by now it has slipped to an insulting 42%. The 15% "crash" was the worst rate among all US presidents over the past 70 years. There is nothing particularly surprising here.
The shame of Afghanistan, which is a military-political failure, which the country has not known since the days of Vietnam, the difficult situation in the economy and, to put it mildly, the not very successful fight against the coronavirus - all this "for the eyes" would be enough to "bury" the image and a much brighter leader than Sleeping Joe. Add to this the default that is clearly looming on the horizon, as well as the rather strange-looking "fixation" of the president on solving the "problems" of various perverts and "green" fantasies, which are not shared by all Americans. The fuel and energy crisis has become, as they say, “the cherry on the cake,” as the level of sympathy for the ruling administration began to decline sharply among US citizens every time they visit a gas station. And on the nose the midterm elections to Congress ... And then the president decided to either shake off the old days, or "chop with a saber" - in a word, to do something bright and outstanding, which in one fell swoop will return to him and his political power the pretty faint sympathies of the electorate.
Such a "feat" was supposed to be a sharp decline in prices for energy resources, and, first of all, for automobile fuel and other oil products. For this, according to the plan of Mr. Biden, a mere trifle was required: to "bend" OPEC + and force the countries entering into it to "unscrew the taps" of their drilling and terminals, so that the flow of "black gold" that poured from there at the moment "washed away" the uncomfortable price tags at American gas stations ... It was in this way that Mr. President went: turning to the main oil cartel of the planet, he "urged" them to increase production in excess of the previously established and agreed norms in order to "support the market." To the great surprise of the head of the White House, neither the Arab sheikhs, nor even more so, the representatives of Rosneft did not even think of stretching themselves out into the frond and saluting. The events of 2020 are too memorable for everyone to embark on such risky experiments, and, moreover, on orders from Washington. The president (scary to think!) Of the United States itself, let's say, was sent on a walking erotic tour. In the mildest and most diplomatic form, of course, but the meaning did not change.
The exporting countries made it clear: not a single "over-planned" barrel will enter the markets, no matter who wants something from them. In early November, the cartel confirmed its firm intention to adhere to the previously set quotas for increasing oil production by no more than 400 thousand barrels per day. And even then - from December and if there are favorable circumstances for this. Naturally, Washington could not tolerate such a "spit in the face" (especially since the indignant motorists did not go anywhere). The decision was made to "settle" the problem by "other means" so beloved by the United States.
Akella from the White House missed?
It was an “ingenious way” to punish the “lost shores” of the upstarts from OPEC +, and at the same time to achieve the desired economic result in the United States, they considered the intervention in the energy market as large as possible of oil contained in strategic reserves. At the same time, the Americans, as usual, tried to cheat and to the maximum "rake in the heat with someone else's hands." To participate in this escapade, they knocked out a number of not only their traditional allies, but also those countries that “sit in the same boat” with the United States does not seem to fit. In addition to bringing to the market 50 million barrels of oil from its own bins, Washington encouraged the UK, Japan, South Korea, India and even China to take similar actions. The last two states "signed up" for this adventure, no doubt, solely because they have enormous needs in the supply of "black gold" and are ready to do anything for the sake of falling prices for it.
Be that as it may, but the total volume of oil released from the "NZ", according to preliminary estimates of experts, should have reached about 75 million barrels. The figure, at first glance, is impressive. But if only you do not compare it with the production volumes of the countries included in OPEC +. It should be noted that Washington was concerned not only with the creation of a "broad anti-OPEC front", but also, as usual, with the appropriate information support. Fatih Birol, Executive Director of the International Energy Agency (IEA), was quick to deliver a heartfelt speech, which, in fact, was not only a justification for the US actions that were rather dubious from the point of view of the advocates of “market principles”, but also a direct indication of the culprits of the current situation.
This figure openly laid the entire responsibility for "creating an artificial shortage in the energy market" and the rise in prices for those exclusively on Russia, Saudi Arabia, as well as "other large suppliers of hydrocarbons." At the same time, he urged them "to immediately take all necessary measures to calm down the world market and return the cost of energy resources to acceptable levels." It sounds somewhat schizophrenic, especially considering that Mr. Birol “forgot” to clarify an essential point: “acceptable” for whom exactly? Well, this is, however, and so clear. In any case, the IEA director was sent to OPEC + to exactly the same address as Joe Biden had earlier. And not without good reason. As of the time of this writing, it was clear: all the forecasts of the would-be experts that the statements about the upcoming “big sale” from the “center of the world” - Washington alone would make oil quotes shrink in horror and rush down at the speed of good sledges flying from the ice slide did not come true even by half a percent. Everything happens exactly the opposite.
"Black gold", which has really survived some negative price fluctuations after the fuss started by the Americans and their allies, is confidently going up again. By the evening of November 24, January futures for the same Brent traded at $ 82,3 per barrel, adding 3,3%. Experienced traders predict that Biden's venture will have absolutely zero effect - and this is even better. If OPEC + takes retaliatory measures (and according to available data, this is exactly how it will be), its result may well turn out to be negative - for the same USA and other oil consumers. There are very specific reasons for this, as they say, lying on the surface.
First, the volume of 50-60 million barrels (even 75 million) is not significant for the global energy market. For reference: the United States itself consumed this amount of oil in 2020 in just three days! What kind of "price collapse" is there, what are you talking about? Secondly, the raw material expected to be extracted from the strategic reserves of the United States (and this is the main volume of the expected intervention) is high-sulfur oil, with which not every refinery will want to contact. Today in particular. The reason is that for its processing it is necessary to spend a considerable amount of natural gas, the price of which is now "biting". Third, as mentioned above, all attempts by the Americans and their allies can easily be canceled out by the members of OPEC +, whose next meeting is scheduled for December 2. They really can "turn the taps" from the heart - that's just in the opposite direction. The planned increase in production at the end of the year may well be canceled, or even replaced by a decrease. Fortunately, there is a quite plausible pretext - a new wave of the coronavirus pandemic in Europe and again quarantine restrictions introduced there.
It must be said that Joe Biden's "historic" decision (and the United States has really not done anything like this since 2011 - the time of the "Libyan" oil crisis) has already been severely criticized in the United States itself. Dan Bruyette, who served as the country's energy secretary during the time of Donald Trump, openly called him "political games of the worst kind" that are detrimental to the national interests of the country and its security. In his opinion, it is permissible to use strategic reserves only in case of emergencies, and not to fight for the hearts and minds of voters. According to Bruyette, instead of such dubious antics, the White House should abandon "green" fantasies and attend to the development of the American oil industry, which the Biden administration is currently "finishing off". One can add to this only the fact that at the same time Washington should get rid of the illusion as soon as possible that everything in the world will continue to be done according to its "will" and "dictate." These times are over, and I want to believe they will never return.