Harold Hutchison / Mar. 2, 2018

Why Low Oil Prices Help America Strategically

When we talk energy policy, we're not just talking about how cheap it is to fill up your gas tank.

We’re sure you all have heard Vladimir Putin talking real big and tough about his new nukes. Don’t believe that hype. Two of those “invincible” weapons, that nuclear-powered cruise missile and the hypersonic weapon, will be easily handled by the lasers America is working on.

That is, if the Russians can even get their super-weapons fielded. One reason they may have trouble is the price of oil and natural gas, and President Donald Trump’s policies are sending those prices down. This should sound familiar. In the book Victory, Peter Schweizer described how Ronald Reagan defeated the Soviet Union with low oil prices. Back then, Reagan secured it by getting the Saudis to ramp up production. Trump, though, wants to promote American oil and gas, some of which is exported to countries like Poland.

In other words, not only is Putin getting a smaller pie, he is losing part of that smaller pie to the United States. It’s kind of hard to fund a new military and pay off the oligarchs and other shady figures when the price of the stuff you are selling drops and you’re not the only person selling it. In short, Putin may boast about the wonder weapons, but a shortage of funds means they will take longer to develop and field. By which point, the United States has counters in place.

Iran will also take a hit. Like Moscow, Tehran needs the oil money to pay for advanced weapons. China is a likely customer for that oil, but the supertankers carrying said oil have to pass through the Andaman Sea, and the increasingly powerful Indian Navy. It’s kind of hard for the ayatollahs to buy new weapons in large quantities when the product they sell for the necessary funds isn’t selling for as much.

When we talk energy policy, we’re not just talking about how cheap it is to fill up your gas tank. We are also talking about a powerful tool to advance America’s strategic interests. Or put a crimp in the plans of America’s enemies.

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