The result of the Biden Administration’s hostility toward the energy industry is skyrocketing inflation.
Where energy prices rose 35% over the last year, all prices rose just 8%.
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In Europe, higher energy prices are responsible for at least half of all inflation.
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There are certainly other factors causing inflation, including the ramping up of supply chains following the pandemic, the $1.7 trillion stimulus last year, and China’s lockdown in response to the omicron coronavirus variant.
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But the non-energy factors behind inflation were temporary, and none explain consistently higher energy prices, which are a major factor in the higher prices of everything, from food to consumer products.
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And energy’s role could be even larger.
“When you strip out of the [Consumer Price Index] items linked to energy (air fares, moving/freight, rental cars, delivery services, new and used vehicles) the core was +0.36% & the YoY steadied near 4%.”
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Some nifty math. When you strip out of the CPI all the items that are linked to energy (air fares, moving/freight, rental cars, delivery services, new and used vehicles), the core was +0.36% and the YoY steadied near 4%. The truth beneath the veneer.
#RosenbergResearch
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The numbers speak for themselves.
In the U.S., the monthly price change in May for all items was 1% but for fuel oil, airline fares, piped utility natural gas, and gasoline the price changes were 17%, 13%, 8%, and 4% respectively.
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As a result, Biden’s hostility to expanded energy production could result in recession. The Federal Reserve yesterday raised interest rates more than at any point since 1994 and could raise them again next month in an increasingly desperate battle against inflation.
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“It may take a recession to stamp out inflation,” concludes Bloomberg, “one that may cost Biden a second term.”
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Why is that? Politicians are famously self-interested, focused on their own preservation at all costs. Why, then, is Biden not only wrecking the economy, by failing to take action to lower energy prices, but also destroying his own presidency?
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Find out by reading the full article at Substack!
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Some say there's nothing Biden can do to increase energy production but my sources, which include the CEO of a major oil/gas firm & a senior exec. at a big bank to the industry, say that Biden could significantly increase oil/gas production within 12 - 18 months.
Here's how:
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There are three key things that Biden must do, my sources say:
1. Invoke the National Defense Act for Oil and Gas. This will enable the acceleration of required permits for oil and gas projects, they say.
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2. Announce a national commitment to purchase oil to fill the Strategic Petroleum Reserve (SPR) at a floor of $80/barrel. That will, they say, be a powerful incentive for the oil guys.
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3. Announce trade agreements with the international community to supply them with LNG (liquified natural gas)
Doing so will incentivize natural gas production and create a surplus of energy for exports with an "American-First asterisk (keep nat gas storage full while exporting).
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I asked my sources, who prefer to stay anonymous at this time, if the American Petroleum Institute would agree with this list. One said they weren't sure "But this is more impactful and concentrated than the 10 point API list they put out," which is here
api.org/-/media/Files/
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Push completions. Last I looked there were a fair amount of drilled but not completed wells.
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Those are great advice to help create the right incentives. Now let's see if the admin wants to solve this problem.
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The Biden administration will say what they said about the Keystone pipeline 6 months ago: "We need to help Americans now! Not 18 months from now!"
And 2 years from now, they'll be saying the same thing.
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