The Energy Revolution Is Tweaking OPEC Out

Yesterday, the oil-producers cartel OPEC—which is now somewhat cheekily called “OPEC+,” because Russia joined in 2016—failed to reach an agreement on increasing oil production. Stick with me for a second, because this may not seem like it has much to do with climate change, but in fact it reveals how decarbonization is already shifting how money is spent and how geopolitical power is exercised.

In the past month or so—as the pandemic has receded in the rich world, and as people have resumed —oil demand has significantly increased. Oil production has, slashed their drilling last year and have not yet brought it back to pre-pandemic levels. As might be expected, this supply-demand imbalance has increased the price of oil: In the international market, a barrel of oil cost about $48 at the start of the year, but $75 on July 1.