(The Center Square) – International oil producers are planning to cut oil production, meaning gas prices will likely begin rising immediately as Democrats block Republican efforts to increase domestic oil and gas energy production.
OPEC+ announced Sunday a cut in oil production to the surprise of many who speculate prices could rise significantly as a result. Last summer, regular gas prices set new records, surpassing $5 per gallon on average.
Gas prices are already on the rise this year. According to AAA, the current national average price for a gallon of regular gasoline is $3.51, up from $3.44 a week ago and $3.39 one month ago.
Energy prices overall have soared since President Joe Biden took office, in part because of Russia’s invasion of Ukraine but also because of Biden’s work to discourage domestic oil and gas investment and production.
“Only a few short years ago foreign governments were unable to use energy as a weapon against the United States,” Daniel Turner, executive director of the energy workers advocacy group Power the Future, told The Center Square. “Then Joe Biden came along and made OPEC great again. Just last week, the House of Representatives passed a bill to put America back on the road to energy independence and it’s clear OPEC was paying attention. The Senate should pass H.R. 1 immediately and President Biden finally needs to put politics aside and unleash the power of American energy. Otherwise the high prices of food, utilities, and food will continue to punish the American people.”
Citing Biden’s role in cost increases, House Republicans passed the “Lower Energy Costs Act” last week. House Democrats opposed the bill, which is unlikely to get traction in the Senate.
“Under H.R. 1, America and our allies won’t be forced to rely on Russian natural gas, which is 41 percent dirtier than American natural gas,” House Speaker Kevin McCarthy, R-Calif., said in a speech after the bill’s passage. “If we had replaced Russian natural gas in Europe for just one year, we would have reduced C02 emissions by 218 million tons.”
Experts say gas price increases are not a sure thing.
“Whether OPEC’s announced production cuts raise prices depends on whether global demand for oil holds up,” Myron Ebell, an energy analyst at the Competitive Enterprise Institute, told The Center Square. “It seems to me that OPEC are guessing that the global economy is slowing down or even moving into recession, in which case demand will go down. By cutting production, they are trying to stay a step ahead of lower demand and avoid the collapse in oil prices that has happened in past economic downturns.
Ebell said Biden’s policies have empowered OPEC to have more control over the global market, including the U.S.
“The shale oil and gas revolution and the Trump deregulatory agenda made the U. S. the world’s top oil and natural gas producer and thereby lessened OPEC’s power to control the global oil market,” he said. “President Biden’s policies to constrain U. S. production and scare away investment in new production are empowering OPEC once again. To what extent remains to be seen.”