Great piece, Matt. I love this kind of analysis and policy recommendation from you. Hope the Biden admin does exactly what you advocate for on this issue.
What about the fact that increasing the price of oil potentially aids Russia during a critical part of the Ukranian conflict. Long term maybe you are right but it seems like low oil prices are in our national interest in the short term.
Your first graph shows US petroleum production at 20,000,000 barrels per day, but your second graph shows a more correct figure of 12,000,000 barrels per day. We do not produce 9,000,000 barrels per day more than Saudi Arabia.
Oil and gas data analytics guy here - I believe the first chart is including "natural gas liquids", which are liquid hydrocarbons that can be removed from natural gas. This includes molecules like propane and butane that are more valuable than gas but less valuable than oil. US shale production is usually rich in these NGLs, and the US is by far the world's biggest gas producer.
Still it is problematic. Russia is the second largest natural gas producer in the world, and not that much smaller than US, so how could daily production be double? You cannot get more NGL than the gas you produce.
Also, if you are correct, then it is still a colossally mislabeled graph.
OK, I dug a little deeper. The US produces 20 million bbl/d "total liquids", of which ~12 million is crude oil and condensate, and ~8 million is NGLs, biofuels, and refining gains. The US produces almost 100 billion cubic feet a day of natural gas, and 6ish million barrels of NGLs from that is quite reasonable.
Saudi produces ~12 million bbl/d total, of which ~10.6 million bbl/d is crude and condensate.
Russia produces ~10.9 million bbl/d total, of which ~10.3 million bbl/d is crude and condensate.
The NGL production from Russia is quite a bit lower than from the US, especially proportional to their gas production. Russian gas primarily comes from large, dry gas fields, whereas US gas comes from unconventional shale wells, most of which have a higher liquids content.
The NGL production is also dependent on processing decisions by the producer. It costs money to remove the NGLs from gas, and so you will only do that if you get extra value.
Realistically, I think for Matt's comparison here he should be using oil production, not total liquids.
Thanks so much, Matt. Valuable work. Readers-of-Matt, I encourage you to read Tooze on the global impacts of America's shift to oil exporting in the 2010s. Via oil finance, it rearranged a core dynamic that has driven the world economy since the 1970s:
I'm confused by this take. Matt is saying that the administration is falling short on buying oil (whether current or via futures) to fill the SPR *and* that he can live with a $70/bbl target price.
But they're falling short because oil hasn't fallen to $70 except for a blink of an eye. West Texas Intermediate was barely below $70 for five days back in March and for two days last week. Brent Crude is similar, though a bit more expensive. Unless DOE has traders ready to swoop into the market the second the price hits $69.99 (which would cause the price to instantaneously spike), I don't think there have really been opportunities -- based on their announced policy -- to hit the market aggressively. (See https://oilprice.com/oil-price-charts/ for price trends.) Now this might be different if they had agreed with Matt that $80/bbl was acceptable, but they didn't and here we are.
Just wait a few more hours :P But I agree with your big picture point. I've been wondering what happened to WTI on May 3 that crashed the price but it doesn't seem like there's any update on it - either an algo bug somewhere or someone huge got liquidated. My (non-serious) conspiracy would be that someone was buying in anticipation of a Biden admin announcement and the bottom fell out when they realized it wasn't going to happen.
The Obama administration did a lot of things right in support of American commercial interests in the 21st century. Four years of Trump going back to tarriffs and 80s style trickle-down economics and the Biden administration pushing unions and other 70s era progressive themes like "oil companies are bad" have over-politicized our economy and destroyed the win-win approach between government and US businesses we had under Obama.
Matt on petroleum price volatility and inflations: He gets to the right conclusion – as he usually does --but for the wrong reasons -as he too often does. A big change in international petroleum prices changes a lot of associated prices in the US. In effect it is a shock that, lie any sufficiently big shock, requires a lot of relative prices in the economy to change if markets are to clear (unemployment of resources in those markets is not to appear). But as we know not all prices can vary up and down, especially down, easily. Therefore, the only way that the relative prices for some things to go up when the absolute prices of some things cannot go down is for some absolute prices to go up and the average of some prices going up and others not is that on average prices go up. That this further means that the Fed ought to facilitate the amount of additional above target inflation needed to allow the income maximizing change in relative prices to occur. And since the Fed is not omniscient it will sometime facilitate too much and sometimes too little inflation. Ergo. Its better if the Fed does not have to deal with these shocks. QED of Matt’s position.
The main argument that it was intended to influence US politics was that it was an odd time for the Saudis to be trying to push up oil prices, as they were already at recent highs due to the Russo-Ukrainian war.
As has been my pattern lately, I actually am going to note something that isn't really the point of this article.
"America’s emergence as a major producer has changed the game — we are less dependent on the goodwill of the Gulf monarchies than we used to be, but they are less interested in cultivating a positive relationship with us. They like Donald Trump, personally, because in exchange for large cash bribes paid directly to his family, he’s been willing to completely subordinate American interests to Gulf interests when it comes to Iran policy."
I just need to say that it's absolutely horrifying that Matt can write this sentence. I don't mean that he's wrong. Quite the opposite. It's just sort of casually known that Trump is completely in the pocket of a murderous dictatorship and that if he came to power there's a good chance that MBS would basically dictate our foreign policy.
One of the tragedies of the "Russia stuff" is that as bad as that is (we still don't have a great explanation as to why Trump is so fawning of Putin. We still have unanswered questions about financial ties between the Trumps and Russia generally), it likely distracted us from the much more concrete corruption that clearly exists between Trump, Kushner and various Middle East dictatorships. There's so much awfulness with the man, that it can be hard to keep track of all the ways Trump returning to power could be so unbelievably awful for America and the world.
Amusingly, I think that the Saudis' are quite foolish to place any faith in Trump.* Its not that he won't take their money and do what they want for a while. Its just that he has demonstrated a willingness to toss anybody and everybody under the bus as soon as it suits him.
*that applies to anyone who places their faith in Trump. Dude would sell his mother for a klondike bar.
Ui! The no-fill position of Democrats was under reported/commented. [I don’t doubt that Trumps _intentions_ were evil; he really did just want to transfer income toward rich people, but Democrats ought to treat policy instrumentally not purely symbolically or s a morality play.] I didn’t hear it criticized even by anyone trying to "own the Libs." As Brad DeLong says, “why can’t we have a better press corp?”
With the "Remain in Mexico" immigration policy news, I'm wondering if its that the Biden administration just want to avoid two "Biden tacks right" headlines in a row. Of course, they can chose not to care about that.
Is buying oil tacking right? It’s a policy intended to keep oil prices high and prepare for future emergencies, which doesn’t sound particularly right-wing to me.
Biden administration has done a lot to advance the green energy transition, but he risks alientating that coalition of supporters. Climate Hawks believe that we should moving steadily away from fossil fuels. No new pipelines, no new refineries, no new fossil fuel plants etc. They understand that we will not eliminate fossil fuel immediately, but are very sensitive to anything that appears to be "moving in the wrong direction". Purchasing oil now to be used later definitely reads as moving the wrong direction. In reality, we can have the aim of stabilizing the price of oil while moving steadily away from fossil fuels, but that nuance reads as excuse-making. His critics on the left will say that Biden administation is selling out to fossil fuel interests (literately using government funds to buy from them!) and using this short-term economic trick as a cynical election ploy (they argue oil should be made nearly worthless in a green future).
Matt has argued that this is the wrong read of Biden administation's incentives and this is the wrong political strategy for an effective green energy transition (no way to pass environmental legislation if you don't win!).
But Matt's is a far from the mainstream view. Just as one example, I don't think climate hawk David Roberts, who writes Volts substack and gives Biden administration more credit on the environment than most, would be on board. Most of Biden's critics from the left are far less charitable than that.
There is something incredibly gauche about writing a column to get the White House to use the SPR for the explicit partisan purpose of helping to re-elect Biden.
Uh, what? What column have you been reading in which Matt hasn't made his partisan preferences, *especially* as against the alternative of Donald trump, extremely clear. Matt's schtick is being a somewhat heterodox centrist with clearly Democratic sympathies, not a crypto-Republican.
The SPR should be filled and kept full to deter war. Stop screwing around with national security. When you break norms, Republicans break norms the next time around. Stop helping them break things.
There’s a difference between sustained economic growth and timing subsidies to land in an election year. It should not become the norm that the government buys oil in non-election years and sells it in election years. That does not help the economy grow, it just helps corrupt incumbents stay in power.
This assumes (correctly but un-"Progressively") that speculators (with oil or anything else) who make profits, stabilize prices. "Sorry, Repubs, I'm just trying to make honest buck to reduce a bit of the deficit you irresponsibly created."
Wouldn't one the best things Biden could do to avoid a 2024 recession be negotiate a lower budget deficit to lower aggregate demand stimulation instead of having Jay Powell up the rates faster potentially destabilizing banks?
I think Joe and Kevin are slowly coming onto the same page, there will merely happen to be a budget deal occurring at the same time as the totally 100% for sure clean debt ceiling raise.
Is it more gauche than foreign governments spiking oil production for the explicit purpose of helping to re-elect Donald Trump? (I have no idea of the likelihood of this, though.)
>> That power to either spike or crash oil prices is the privilege of having such a low breakeven price. And the goal of American SPR policy should be to seize the power to be the global price setter.
I agree with Matt's overall point that the SPR should be refilled, including using futures contracts. OTOH, while the SPR can support oil's price in the short term, it can't support its price in the face of a sustained drop in worldwide demand and imo that's what's coming.
The 2020 oil crash was the result of just a 10% drop in oil demand. As of last quarter, EVs account for 34% of car sales in China and the rest of the world isn't far behind. By 3035, EVs will almost certainly account for the majority of car sales.
In light of this and other climate change mitigation efforts, worldwide oil demand over the next 10 to 20 years is going to drop significantly. It won't be long before it's substantially lower than pandemic levels and prices will eventually be permanently below both the US and Russia breakeven price.
I would pause before celebrating Biden's use of the SPR for political gain. He may have outfoxed republicans politically, but there was a cost. To name two: From now own both parties will use the SPR for their political ends when they are in the WH; Depleting the SPR put the country at increased risk if there had been an actual oil shortage. I think we should mourn each instance (from either party) when politicians break longstanding norms to act in the country's best interest in order to meet short term political ends.
Lastly, you seem to assume that the SPR can be filled and emptied without problem. But, the SPR is in salt caves not storage tanks, and was never intended to be emptied and filled repeatedly. Below is an article from the American Association of Petroleum Geologists. While not exactly an unbiased group, they have expertise, and as it was written in 2016, would seem to not be posted because of the current political environment.
Matt's proposal as I read it is to institutionalize a new role for the SPR to stabilize oil prices at the level we choose, long-term. Establishing a new norm. I suppose either party could still use the SPR to drop the price as low as they want right before the election, which would be a new, shitty and abusive practice. But in our current moment that sort of thing is happening on every side, and it doesn't seem to be an argument against Matt's proposal.
The second paragraph I definitely did not know and definitely changes some of my thoughts on this. Definitely changes my thinking here.
I think given that GOP winning in 2024 would be so much worse for the environment then anything Democrats would realistically do; still seems smart for Biden to take Matt's advice. But good to know this really should be a "break glass in case of emergency" situation.
Great piece, Matt. I love this kind of analysis and policy recommendation from you. Hope the Biden admin does exactly what you advocate for on this issue.
What about the fact that increasing the price of oil potentially aids Russia during a critical part of the Ukranian conflict. Long term maybe you are right but it seems like low oil prices are in our national interest in the short term.
Putting words to action quickly!
https://twitter.com/mattyglesias/status/1656740618775719942
I liked Matt Zeitlin's take on it: https://twitter.com/MattZeitlin/status/1656740664707633154
Large cash bribes?? Unfortunately behind the NTY paywall. A friend unlocked it for me
https://www.nytimes.com/2022/04/10/us/jared-kushner-saudi-investment-fund.html?unlocked_article_code=nF9ts20QXR0h2aI9Jwlee_e1pPnpmqE4gKxPQY7qLUmmp11efFijhG5Pqx0e-vazgrj-o7ZFOwJ3B-P1l0LaKuaWimzy2zE2dJxKgyobYjmrCUyBa9i25jzljY8fv0aKLfobAsC0NHbZQAhbQTPq6V93miyRCxlsAevb7SnmjLly8yzNQnzKFP29EwVLDfl4F0NnY6u8Um_l4-bMJGnTyqmAtMZfIT2px6TjAx_vE36gKr4b_XkZyJ--YTZOiiDZVcSTilUgKjqZgtEuiM4GRYHQ6lNdo7mW0XnD8Ppl9dIzTZ3U42v4g7JHWv-uqorFmT6X6IyzyuBzRnZ2bLCqbK3WsOrrPBxa&smid=nytcore-ios-share&referringSource=articleShare
Friends don't let friends post hideous, ugly links; use Archive.PH! (it also breaks most paywalls)
https://archive.is/Pk6jA
Your first graph shows US petroleum production at 20,000,000 barrels per day, but your second graph shows a more correct figure of 12,000,000 barrels per day. We do not produce 9,000,000 barrels per day more than Saudi Arabia.
Oil and gas data analytics guy here - I believe the first chart is including "natural gas liquids", which are liquid hydrocarbons that can be removed from natural gas. This includes molecules like propane and butane that are more valuable than gas but less valuable than oil. US shale production is usually rich in these NGLs, and the US is by far the world's biggest gas producer.
Still it is problematic. Russia is the second largest natural gas producer in the world, and not that much smaller than US, so how could daily production be double? You cannot get more NGL than the gas you produce.
Also, if you are correct, then it is still a colossally mislabeled graph.
OK, I dug a little deeper. The US produces 20 million bbl/d "total liquids", of which ~12 million is crude oil and condensate, and ~8 million is NGLs, biofuels, and refining gains. The US produces almost 100 billion cubic feet a day of natural gas, and 6ish million barrels of NGLs from that is quite reasonable.
Saudi produces ~12 million bbl/d total, of which ~10.6 million bbl/d is crude and condensate.
Russia produces ~10.9 million bbl/d total, of which ~10.3 million bbl/d is crude and condensate.
The NGL production from Russia is quite a bit lower than from the US, especially proportional to their gas production. Russian gas primarily comes from large, dry gas fields, whereas US gas comes from unconventional shale wells, most of which have a higher liquids content.
The NGL production is also dependent on processing decisions by the producer. It costs money to remove the NGLs from gas, and so you will only do that if you get extra value.
Realistically, I think for Matt's comparison here he should be using oil production, not total liquids.
Here is the relevant data from the EIA: https://www.eia.gov/international/data/world/petroleum-and-other-liquids/annual-refined-petroleum-products-consumption?pd=5&p=0000000000000000000000000000000000vg&u=0&f=A&v=mapbubble&a=-&i=none&vo=value&t=C&g=00000000000000000000000000000000000000000000000001&l=249-ruvvvvvfvtvnvv1urvvvvfvvvvvvfvvvou20evvvvvvvvvnvvvvs&s=94694400000&e=1640995200000
Thanks so much, Matt. Valuable work. Readers-of-Matt, I encourage you to read Tooze on the global impacts of America's shift to oil exporting in the 2010s. Via oil finance, it rearranged a core dynamic that has driven the world economy since the 1970s:
https://adamtooze.substack.com/p/chartbook-212-the-end-of-the-petrodollar
I'm confused by this take. Matt is saying that the administration is falling short on buying oil (whether current or via futures) to fill the SPR *and* that he can live with a $70/bbl target price.
But they're falling short because oil hasn't fallen to $70 except for a blink of an eye. West Texas Intermediate was barely below $70 for five days back in March and for two days last week. Brent Crude is similar, though a bit more expensive. Unless DOE has traders ready to swoop into the market the second the price hits $69.99 (which would cause the price to instantaneously spike), I don't think there have really been opportunities -- based on their announced policy -- to hit the market aggressively. (See https://oilprice.com/oil-price-charts/ for price trends.) Now this might be different if they had agreed with Matt that $80/bbl was acceptable, but they didn't and here we are.
Just wait a few more hours :P But I agree with your big picture point. I've been wondering what happened to WTI on May 3 that crashed the price but it doesn't seem like there's any update on it - either an algo bug somewhere or someone huge got liquidated. My (non-serious) conspiracy would be that someone was buying in anticipation of a Biden admin announcement and the bottom fell out when they realized it wasn't going to happen.
The Obama administration did a lot of things right in support of American commercial interests in the 21st century. Four years of Trump going back to tarriffs and 80s style trickle-down economics and the Biden administration pushing unions and other 70s era progressive themes like "oil companies are bad" have over-politicized our economy and destroyed the win-win approach between government and US businesses we had under Obama.
Matt on petroleum price volatility and inflations: He gets to the right conclusion – as he usually does --but for the wrong reasons -as he too often does. A big change in international petroleum prices changes a lot of associated prices in the US. In effect it is a shock that, lie any sufficiently big shock, requires a lot of relative prices in the economy to change if markets are to clear (unemployment of resources in those markets is not to appear). But as we know not all prices can vary up and down, especially down, easily. Therefore, the only way that the relative prices for some things to go up when the absolute prices of some things cannot go down is for some absolute prices to go up and the average of some prices going up and others not is that on average prices go up. That this further means that the Fed ought to facilitate the amount of additional above target inflation needed to allow the income maximizing change in relative prices to occur. And since the Fed is not omniscient it will sometime facilitate too much and sometimes too little inflation. Ergo. Its better if the Fed does not have to deal with these shocks. QED of Matt’s position.
Do the "likers" think it's worth turning into a Substack post?
I’m not sure about the claim that the ME monarchies like Trump so much more than Biden than they’d manipulate oil prices to help him get elected.
Didn't the Saudis conveniently spearhead an OPEC+ production cut in fall 2022 that resulted in an oil price bump before the midterms?
Is there evidence the reason they did that was to influence domestic US politics?
The main argument that it was intended to influence US politics was that it was an odd time for the Saudis to be trying to push up oil prices, as they were already at recent highs due to the Russo-Ukrainian war.
As has been my pattern lately, I actually am going to note something that isn't really the point of this article.
"America’s emergence as a major producer has changed the game — we are less dependent on the goodwill of the Gulf monarchies than we used to be, but they are less interested in cultivating a positive relationship with us. They like Donald Trump, personally, because in exchange for large cash bribes paid directly to his family, he’s been willing to completely subordinate American interests to Gulf interests when it comes to Iran policy."
I just need to say that it's absolutely horrifying that Matt can write this sentence. I don't mean that he's wrong. Quite the opposite. It's just sort of casually known that Trump is completely in the pocket of a murderous dictatorship and that if he came to power there's a good chance that MBS would basically dictate our foreign policy.
One of the tragedies of the "Russia stuff" is that as bad as that is (we still don't have a great explanation as to why Trump is so fawning of Putin. We still have unanswered questions about financial ties between the Trumps and Russia generally), it likely distracted us from the much more concrete corruption that clearly exists between Trump, Kushner and various Middle East dictatorships. There's so much awfulness with the man, that it can be hard to keep track of all the ways Trump returning to power could be so unbelievably awful for America and the world.
Amusingly, I think that the Saudis' are quite foolish to place any faith in Trump.* Its not that he won't take their money and do what they want for a while. Its just that he has demonstrated a willingness to toss anybody and everybody under the bus as soon as it suits him.
*that applies to anyone who places their faith in Trump. Dude would sell his mother for a klondike bar.
Ui! The no-fill position of Democrats was under reported/commented. [I don’t doubt that Trumps _intentions_ were evil; he really did just want to transfer income toward rich people, but Democrats ought to treat policy instrumentally not purely symbolically or s a morality play.] I didn’t hear it criticized even by anyone trying to "own the Libs." As Brad DeLong says, “why can’t we have a better press corp?”
With the "Remain in Mexico" immigration policy news, I'm wondering if its that the Biden administration just want to avoid two "Biden tacks right" headlines in a row. Of course, they can chose not to care about that.
Getting caught "tacking right" is probably good politics. :)
Is buying oil tacking right? It’s a policy intended to keep oil prices high and prepare for future emergencies, which doesn’t sound particularly right-wing to me.
Absolutely it will read that way.
Biden administration has done a lot to advance the green energy transition, but he risks alientating that coalition of supporters. Climate Hawks believe that we should moving steadily away from fossil fuels. No new pipelines, no new refineries, no new fossil fuel plants etc. They understand that we will not eliminate fossil fuel immediately, but are very sensitive to anything that appears to be "moving in the wrong direction". Purchasing oil now to be used later definitely reads as moving the wrong direction. In reality, we can have the aim of stabilizing the price of oil while moving steadily away from fossil fuels, but that nuance reads as excuse-making. His critics on the left will say that Biden administation is selling out to fossil fuel interests (literately using government funds to buy from them!) and using this short-term economic trick as a cynical election ploy (they argue oil should be made nearly worthless in a green future).
Matt has argued that this is the wrong read of Biden administation's incentives and this is the wrong political strategy for an effective green energy transition (no way to pass environmental legislation if you don't win!).
But Matt's is a far from the mainstream view. Just as one example, I don't think climate hawk David Roberts, who writes Volts substack and gives Biden administration more credit on the environment than most, would be on board. Most of Biden's critics from the left are far less charitable than that.
There is something incredibly gauche about writing a column to get the White House to use the SPR for the explicit partisan purpose of helping to re-elect Biden.
You may think it's gauche, but I think it's adroit. (High school French comes through again!)
Uh, what? What column have you been reading in which Matt hasn't made his partisan preferences, *especially* as against the alternative of Donald trump, extremely clear. Matt's schtick is being a somewhat heterodox centrist with clearly Democratic sympathies, not a crypto-Republican.
God forbid that Biden try to win re-election by improving economic conditions.
The SPR should be filled and kept full to deter war. Stop screwing around with national security. When you break norms, Republicans break norms the next time around. Stop helping them break things.
What’s the risk? That in a similar situation Republicans take the same action to improve economic conditions?
There’s a difference between sustained economic growth and timing subsidies to land in an election year. It should not become the norm that the government buys oil in non-election years and sells it in election years. That does not help the economy grow, it just helps corrupt incumbents stay in power.
This assumes (correctly but un-"Progressively") that speculators (with oil or anything else) who make profits, stabilize prices. "Sorry, Repubs, I'm just trying to make honest buck to reduce a bit of the deficit you irresponsibly created."
Wouldn't one the best things Biden could do to avoid a 2024 recession be negotiate a lower budget deficit to lower aggregate demand stimulation instead of having Jay Powell up the rates faster potentially destabilizing banks?
Totally, they can hash out the budget as soon as Kevin agrees to a clean debt ceiling raise.
I think Joe and Kevin are slowly coming onto the same page, there will merely happen to be a budget deal occurring at the same time as the totally 100% for sure clean debt ceiling raise.
Is it more gauche than foreign governments spiking oil production for the explicit purpose of helping to re-elect Donald Trump? (I have no idea of the likelihood of this, though.)
>> That power to either spike or crash oil prices is the privilege of having such a low breakeven price. And the goal of American SPR policy should be to seize the power to be the global price setter.
I agree with Matt's overall point that the SPR should be refilled, including using futures contracts. OTOH, while the SPR can support oil's price in the short term, it can't support its price in the face of a sustained drop in worldwide demand and imo that's what's coming.
The 2020 oil crash was the result of just a 10% drop in oil demand. As of last quarter, EVs account for 34% of car sales in China and the rest of the world isn't far behind. By 3035, EVs will almost certainly account for the majority of car sales.
https://www.goldmansachs.com/intelligence/pages/electric-vehicles-are-forecast-to-be-half-of-global-car-sales-by-2035.html
https://insideevs.com/news/665891/china-plugin-car-sales-march2023
In light of this and other climate change mitigation efforts, worldwide oil demand over the next 10 to 20 years is going to drop significantly. It won't be long before it's substantially lower than pandemic levels and prices will eventually be permanently below both the US and Russia breakeven price.
If we do get a sustained low price then I think it's ok if domestic producers stop extracting it. It's the cartel driven fluctuations that bother me.
Matt,
I would pause before celebrating Biden's use of the SPR for political gain. He may have outfoxed republicans politically, but there was a cost. To name two: From now own both parties will use the SPR for their political ends when they are in the WH; Depleting the SPR put the country at increased risk if there had been an actual oil shortage. I think we should mourn each instance (from either party) when politicians break longstanding norms to act in the country's best interest in order to meet short term political ends.
Lastly, you seem to assume that the SPR can be filled and emptied without problem. But, the SPR is in salt caves not storage tanks, and was never intended to be emptied and filled repeatedly. Below is an article from the American Association of Petroleum Geologists. While not exactly an unbiased group, they have expertise, and as it was written in 2016, would seem to not be posted because of the current political environment.
https://www.aapg.org/publications/news/spheresofinfluence/details/articleid/36728/the-good-the-bad-and-the-ugly-the-strategic-petroleum-reserve
Matt's proposal as I read it is to institutionalize a new role for the SPR to stabilize oil prices at the level we choose, long-term. Establishing a new norm. I suppose either party could still use the SPR to drop the price as low as they want right before the election, which would be a new, shitty and abusive practice. But in our current moment that sort of thing is happening on every side, and it doesn't seem to be an argument against Matt's proposal.
The salt cave thing is a problem though!
Sounds like we need a Tactical Petroleum Reserve in addition to the Strategic Petroleum Reserve.
That seems important?
Sounds like we have a mineshaft gap.
(Bonus points for catching this very old reference.)
Is it like a basselope gap? (Extra bonus points for catching this very old reference).
I bow to your yet more obscure reference which flew right past me.
It's from Bloom County. Berke Breathed was making fun of the 80s missile gap panic, which I assume is your reference.
Mine is from Dr. Strangelove but Bloom County was awesome as well.
The second paragraph I definitely did not know and definitely changes some of my thoughts on this. Definitely changes my thinking here.
I think given that GOP winning in 2024 would be so much worse for the environment then anything Democrats would realistically do; still seems smart for Biden to take Matt's advice. But good to know this really should be a "break glass in case of emergency" situation.