The Venezuelan gambit is part of the Biden Administration rolling dictator tour to encourage more oil supply from anywhere except America.
WSJ Editorial
Rather than call Midland or Tulsa or Minot, President Biden is calling Caracas in a desperate attempt to produce more oil and lower gasoline prices. It is not working.
November gasoline futures bottomed in September around $2.26. Since the last low around September 22, price has already soared to $2.70. Clearly the markets see higher prices ahead. That is a 20% increase in less than a month. The mid-term elections are about a month away.
How many errors can Energy Team Biden make in such a short time? Calling Saudi Arabia pariah during the campaign told us how unrealistic his administration would be. Go big on spending just brought more inflation as he fueled dreams of green energy. Draining the Strategic Reserve has only left the prospect of re-filling at ever higher prices. During his appearance in Florida post Ian Biden got in a plug for wind and solar. With power lines down for millions in the state, how would wind and solar help?
Team Biden has done everything to make oil and gas production more difficult. Germany’s foolish reliance on Russia is plain to see as Putin fails in his attempt to take Ukraine. Already the Nord Stream pipeline has been sabotaged.
Rather than pull back, admit green over-reach, and encourage domestic production, Team Biden turns to Maduro’s reckless dismemberment of what used to be a prosperous country; 6.8 million former residents have fled the country. Energy equipment is poorly maintained and manned if at all. Worse Venezuela produces heavy hard to refine crude.
Sucking up to Maduro will only strengthen the grip Cuba already holds over that country with its tentacles spreading over the rest of South America.
Gasoline futures peaked around $3.42 in June. But the down trend has already reversed. Crude oil has also bottomed and reversed to the upside. November is up $1.40 this morning to $89.84. that is a big lift from the low of $76 in late September.
The DJIA has experienced extreme volatility. Last week we had back to back 500 point down days. This week we had back to back 700 point up days. It is doubtful the rally will continue beyond another week.
Whatever negative campaigning the Democrats mount against Republicans, high gasoline and a bear market in stocks will likely be more on voters’ minds.
