Push Toward $50 Oil Threatens Climate.

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A battle among OPEC+ nations may push crude oil prices as low as $50 a barrel. Less than two years ago, near the start of the Russian invasion of Ukraine, they surged to $100. Today, the price ranges between $68 and $80. Low oil prices make crude an attractive energy source, even compared to most solar and wind. That means emissions stay high and the climate crisis worsens.

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The reason crude oil prices could drop so low, according to The Wall Street Journal, “The Saudi oil minister has said prices could drop to as low as $50 per barrel if so-called cheaters within OPEC+ don’t stick to agreed-upon production limits, according to delegates in the cartel.” Speculation is that the Saudis could start a price war. As among the richest members, it can take a low margin on its crude exports.

Among the best examples of how low crude prices could affect the environment is gas-powered cars. At $50 oil, gas prices could drop below $2. This makes operating a gas-powered car relatively inexpensive. Gas-powered cars still cost less, on average, to buy than EVs. EVs become less attractive in terms of the cost of operation.

Over a longer time horizon, even utilities find low oil prices a better alternative to green energy. Visualize Energy states, “In 2022, about 4000 utility-scale electric generators that burned petroleum were operating in the United States, accounting for about 3% of total generation capacity.”

Low oil prices encourage using crude oil for energy generation, which raises greenhouse gas emissions.

Will the Saudis follow through with their threat? If so, one by-product will be that living in America will, for the most part, be less expensive. Heating oil, petrochemicals, gas, and jet fuel might be less expensive. This might even lead to a cycle of deflation. It might also mean that greenhouse gas goals are destroyed.