The Biden administration did something yesterday that had some folks in the energy industry scratching their heads: It wrote a letter to OPEC and its allies urging the cartel to boost oil output to tackle rising gasoline prices.
Texas Gov. Greg Abbott responded on Twitter, writing, “Dear White House: Texas can do this. Our producers can easily produce that oil if your Administration will just stay out of the way.”
Except, it’s not quite that simple. U.S. politicians pressuring OPEC is not a new thing. President Bill Clinton did it, as did President Donald Trump, according to Antoine Halff at Columbia University.
“There’s a tradition of calling on OPEC and putting the blame on OPEC for high prices and asking very publicly OPEC to increase supply to bring the price down,” he said.
But squeezing OPEC rarely works. It’s a powerful cartel that doesn’t have to lose too much sleep over rising gas prices in the United States. American politicians also have limited control at home, said Sara Vakhshouri, president of the oil and gas consultancy SVB Energy International.