Joe Biden has left the US “vulnerable” after “draining” America’s strategic petroleum reserve, a US economist has warned.
Shipping delay concerns are growing after BP paused operations through the Red Sea following a series of attacks by rebels.
The British oil giant said the suspension comes amid a “deteriorating security situation” with tensions in the Middle East.
Following the announcement of the shipping interlude, Heritage Foundation economist, Dr. E. J. Antoni described the Biden administration as “reckless” which as a result has “left the US and her allies more vulnerable to events like this”.
Joe Biden has left the US ‘vulnerable’ after ‘draining’ America’s strategic petroleum reserve, a US economist has warned
GB News/Reuters
Speaking to GB News, he said: “This is just one example of why the Biden administration’s draining of America’s strategic petroleum reserve was so reckless – it has left the U.S. and her allies more vulnerable to events like this.
“The current economic slowdown around the world has also temporarily dampened oil demand, which provides a small amount of breathing room as well, limiting the upward pressure on prices.
“However, reflecting once more on the long-term trajectory of the industry, many Western countries are committing energy suicide by transitioning to unreliable and inefficient “green” energy while abandoning domestic oil and gas, the bulwarks of their economic power.
“Coupled with future oil production cuts from OPEC+, this points to a slow but steady increase in energy prices for a long time to come, making $100 oil not just plausible, but likely in the years to come.”
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Discussing the potential surge of oil prices, the public finance economist, said a rise to $100 a barrel of oil is “likely in the years to come”.
“There’s no indication that oil will rise over $100 in the near term. There are sufficient global stockpiles to ride out temporary disruptions,” he said.
“But that’s not to say a prolonged closure of the Red Sea won’t have a considerable impact. Eventually, both private and public reserves will run dry.”
Antoni added: “Coupled with future oil production cuts from OPEC+, this points to a slow but steady increase in energy prices for a long time to come, making $100 oil not just plausible, but likely in the years to come.”
The Galaxy Leader cargo ship was escorted by Houthi boats in the Red Sea in November
Reuters
On Monday, Houthis militants in Yemen attacked two commercial ships with naval drones – the MSC Clara, which is a Panama-flagged vessel and the Norwegian-owned Swan Atlantic.
Attacks have been carried out by Houthi rebels in protest over Israel’s war against Hamas in Gaza.
On Saturday, the Royal Navy shot down a suspected attack drone in the Red Sea which was thought to be planning to target merchant shipping.
It is the first time in decades that the Royal Navy has shot down an aerial target in anger.
Robert Johnson is a UK-based business writer specializing in finance and entrepreneurship. With an eye for market trends and a keen interest in the corporate world, he offers readers valuable insights into business developments.
