Oil prices on track for big gains as Biden policies fuel inflation.
My colleague Mary Chastain noted that current reports indicate that inflation is at the highest levels that we have seen in nearly four decades.
Biden has just signed an order that will surely extend the problem.
The Biden administration has ordered U.S. government agencies to immediately stop financing carbon-intensive fossil fuel projects overseas and prioritize international collaborations to deploy clean energy technology, according to U.S. diplomatic cables.
The cables, seen by Reuters, say U.S. government engagements should reflect the goals set in an executive order issued at the start of the year aimed at ending American financial support of coal and carbon-intensive energy projects overseas.
“The goal of the policy described below is to ensure that the vast majority of U.S. international energy engagements promote clean energy, advance innovative technologies, boost U.S. cleantech competitiveness, and support net-zero transitions, except in rare cases where there are compelling national security, geostrategic, or development/energy access benefits and no viable lower carbon alternatives accomplish the same goals,” a cable said.
At least one country fully supports Biden’s move.
The move underscores how the Biden administration has made fighting climate change one its most urgent policy priorities. Yet the approach creates a major opening for China, which is eager to fund and finance energy projects around the world, often with sums of money the U.S. has been unable to match.
The administration stressed that while the U.S. government will withhold support, it won’t actively seek to prevent U.S. companies from building coal, oil and gas projects overseas.
Not surprisingly, oil prices are set to rise substantially.
Oil prices rose on Friday slightly and were on track for their biggest weekly gain since late August, with market sentiment buoyed by easing concerns over the Omicron coronavirus variant’s impact on global economic growth and fuel demand.
The Brent and U.S. West Texas Intermediate (WTI) crude benchmarks were both on course for gains of about 8% this week, their first weekly gain in seven, even after a brief bout of profit-taking.
Brent futures were up 42 cents, or 0.6%, at $74.85 a barrel by 2:06 p.m. Eastern (1706 GMT) after falling 1.9% on Thursday.
WTI rose 43 cents, or 0.6%, to $71.37 after sliding 2% in a volatile session the previous day.
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